Making an offer on property in Berlin Lankwitz

[WallE 5]

Together with my wife, I am interested in buying a flat in Lankwitz. Unfortunately we have no experience with buying real estate and don't know how to position our offer. Should we offer the asking price, slightly less, or more? The only thing we know is that the owner already has two offers and he said he doesn't want to do 'Bieterverfahren', i.e. start a bidding contest between potential buyers.

 

The flat has been recently renovated and is in very good condition (they were planning to stay in the flat for much longer), so I'd expect that the seller won't want to go much down with the price. At the same time, I've noticed that the market in Berlin is currently so overheated that some sellers are very optimistic about the value of their properties to put it mildly.

 

I understand that this is a highly opinion-based question, but we don't know where else to ask.

[murphaph 9,638]

This is really difficult to say but just one point to note, you presumably don't know for sure that the owner has two bids already. The owner or estate agent just told you that, right? You should maybe treat that information with a healthy dose of scepticism. Having said that, it might also be the truth. I think all you can do is decide what you are prepared to pay for the property and then place that bid, in the expectation that you will be outbid. If you aren't you bid too much, but you got the place. If you are outbid, it's ok because it was outside your budget/what you were prepared to pay. There's little point trying to get into the head of a seller, especially if you are hearing everything second hand through their agent.

[RedMidge 6,638]

Sounds as if the estate agent or the owner are starting a bidding war already!  As murphaph says- decide on your  limit, and how much you want the place.

Also- if you are not in a chain and can close quickly, that may  help your bid. Good luck.

 

[catjones 1,658]

Have you checked the market nearby to see if the seller's price is in the ballpark?

[murphaph 9,638]

If it's anything like around here it'll be very difficult to make a fair comparison between asking prices (selling prices are confidential here). Sites and houses all different sizes, houses with and without cellars, block built or prefab, year of construction (and hence energy efficiency), type and age of heating system etc. etc. It's really different to Ireland where most people live in identical houses in housing estates in exactly the same sized plots of land built to the same standard at the same time. There are also relatively few properties for sale in and around Berlin. 

[catjones 1,658]

2 hours ago, murphaph said:

very difficult to make a fair comparison

 

I don't know about that.  When I enter zipcode 10405 (Berlin) at .immobilienscout24.de I get 1476 hits.  There are a lot of sort selections and location maps.  I think that gives me a pretty good picture of asking prices.  I don't understand the keeping selling prices "secret" mentality.  The buyer, seller, makler, notar, mortgage holder and government records office all know the final price, so it's far from secret.  To me, it's the same idiocy of blurring google maps.  One crank in an apartment blurs the entire building into perpetuity.

[emkay 10,150]

I’ve no idea if the property valuations available online are in any way realistic these days. We used this one 10 years ago and it was pretty accurate. At least you’ll get an idea.  Also just Google Immobilienbewertung. Comes up with McMakler, Immowelt etc.

 

https://www.immobilienscout24.de/immobilie-bewerten/?gclid=EAIaIQobChMIgqzA2Ymq-AIVxu3tCh35QASSEAAYBCAAEgKcHvD_BwE

 

My cousin was recently in a similar situation. The seller referred to other offers that he probably didn’t have. The seller also said he didn’t want a multiple bidding situation. In the end, my cousin decided that the property was absolutely right for his family with nothing else  closely suitable. He just asked the seller which realistic price would be accepted straight away as he wasn’t involved in a property chain and finance was already arranged.  The seller took a few hours to think about it and proposed about a 2% increase on the asking price. The deal was done quickly. 
 

Good luck. 

[Brockman 220]

In my recent experience of having bought a new flat in Berlin and knowing several other people that have, it's unlikely any seller of real estate in Berlin will need to accept less than their asking price. If I really wanted a flat, I would offer at least the asking price. In my opinion, it would not be worth losing out on something for a few grand (which amounts to a trivial amount in monthly mortgage payment). Good luck!

[murphaph 9,638]

14 hours ago, catjones said:

 

I don't know about that.  When I enter zipcode 10405 (Berlin) at .immobilienscout24.de I get 1476 hits.  There are a lot of sort selections and location maps.  I think that gives me a pretty good picture of asking prices.  I don't understand the keeping selling prices "secret" mentality.  The buyer, seller, makler, notar, mortgage holder and government records office all know the final price, so it's far from secret.  To me, it's the same idiocy of blurring google maps.  One crank in an apartment blurs the entire building into perpetuity.

He's not looking in 10405 which is central Berlin near to Alexanderplatz. He's looking in a suburb, Lankwitz. For a laugh I just checked Immoscout using the two Lankwitz PLZs. There are a grand total of 20 flats to buy and 0 houses in the whole place. Some will have nicer locations than others. Now start filtering those 20 flats to get required floor area, number of rooms etc. and there will likely be at best 1 or 2 properties left at the end of the filtering that would be remotely comparable to what the OP is looking at. That is not enough data to draw any conclusions about the asking price from.

[catjones 1,658]

5 hours ago, murphaph said:

That is not enough data to draw any conclusions about the asking price from.

 

I don't want to belabor this too much, but if it were me and had

 

On 6/12/2022, 7:56:40, WallE said:

no experience with buying real estate

 

 I would search nearby neighborhoods or even similar neighborhoods elsewhere, so I would have some idea of property values.  Yes, they wouldn't be exact and they wouldn't be next door, but if you drive thru the surrounding suburbs and see similar houses and look at enough of them, you'll probably discover that house A does not ask 400K while a similar house in a similar neighborhood is asking 800K. Like all investments, knowledge is key and ignorance has its costs.

[catjones 1,658]

11 hours ago, Brockman said:

any seller of real estate in Berlin will need to accept less than their asking price

 

Well, that's not entirely accurate.  In this market, there is also speculative selling..

[WallE 5]

Thank you all for your contributions to the topic. We visited the flat, liked it and spent about an hour discussing with the owner. He said he didn't have any offers yet when we asked that day. I sent him an email with some additional questions the next day and I expressed my surprise that nobody offered to buy the flat yet, since we didn't see anything wrong with it. This was meant to provoke a reaction from the owner to understand what's going on even though it was clear to us that he is unlikely to reveal any flaws unless they could invalidate a potential contract. One can always try I guess. He answered that he had two offers in the meantime and is expecting a third one but would not reveal any prices. I am explaining this to @RedMidge - I'm not sure it's meant as a start of a bidding war, but who knows.

 

@catjones you can't really take any flat in given location and think that that constitutes your pool of objects to choose from. A working class family of 6 will search for a different kind of property than a banker with his wife.

@murphaph is unfortunately spot on regarding the number of properties on sale that would at least approximately fit our needs, and we've been watching this area for months now. I'd happily make a comparative study if only I had something to compare this flat to.

 

The asking price is more or less right (we've seen quite a few similar flats elsewhere in Berlin by now), but my question was rather if in your experience with bidding contests are other buyers likely to offer the initial price or go significantly up. And maybe they assume that the seller would be happy with less and intentionally hiked up the price and they therefore offer slightly less. I wouldn't certainly expect a 10% discount, but we simply don't know what's the culture here in Germany.

 

I quite like @murphaph 's idea of fixing our upper limit and sticking to that instead of second-guessing the seller.

We are obviously aware that the seller might not be completely honest with us. We also sent all information about the flat to our bank and asked for their opinion. They're working on it. We have time till the end of June to submit our offer (or not).

[Fietsrad 385]

There are always other dwellings for sale, if you do not 'have' to move/buy you could wait and observe, gather detailed knowledge about prices. Buying a home is for decades, you could wait a few months or a couple years even.

 

Dunno about Ireland but in Wales there WERE large estates of identical houses. They were identical when built decades ago, but nearly every single one has been extended, more bedrooms, bathroom, attic, garage. Prices might still be comparable if you can get a worthwhile sample.

[WallE 5]

1 hour ago, Fietsrad said:

There are always other dwellings for sale, if you do not 'have' to move/buy you could wait and observe, gather detailed knowledge about prices. Buying a home is for decades, you could wait a few months or a couple years even.

 

Dunno about Ireland but in Wales there WERE large estates of identical houses. They were identical when built decades ago, but nearly every single one has been extended, more bedrooms, bathroom, attic, garage. Prices might still be comparable if you can get a worthwhile sample.

We don't want to make a rash decision and waiting for a couple of months is fine. We keep visiting properties to gain knowledge about prices as you say. On the other hand, if the growth of property prices stays at the same level as it has been for some years now (Berlin, even pre-Covid and prior to the war in Ukraine), then it will outstrip our salary growth and our relative buying power will decrease. I don't see how that would place us in a better position.
Maybe there will be some sort of real estate market collapse, but that's extremely difficult to predict imho and I wouldn't bet on it.

 

We used to live in London, so I can imagine what you mean when you speak about houses in Ireland ...

[catjones 1,658]

5 hours ago, WallE said:

@catjones you can't really take any flat in given location and think that that constitutes your pool of objects to choose from. A working class family of 6 will search for a different kind of property than a banker with his wife.

 

I'm not seeing the connection to my points, but thanks for the insight.

[WallE 5]

8 hours ago, catjones said:

 

I'm not seeing the connection to my points, but thanks for the insight.

You said in one of your posts above ' When I enter zipcode 10405 (Berlin) at .immobilienscout24.de I get 1476 hits '. As the title of the post says, we're not looking in 10405, but I understand that comparing with similar neighborhoods at least gives you an idea.

You didn't mention any search criteria, so I suppose that you just took all flats in that area, regardless of price, size, number of rooms etc. Have you ever met a buyer that would take just about any flat without having more concrete idea about what is it that they actually want? Try to make that search more specific (say something suitable for a family with 3 children) and as @murphaph said, you'll see how many flats will be left to choose from.

 

I hope the connection to your points is clearer now.

[Brockman 220]

We offered a bit under the asking price (~5%) for our flat (new building in Berlin) and we were basically laughed at. Of course it's hard to know if there are any other offers, but our philosophy was that we did not want to lose the place for a few grand, which, in the grand scheme of things, is not a lot of money. We ended up offering the asking price and it was accepted. You could try to go the route of hiring an expert and trying to find flaws, but here in Berlin someone will probably come along and be willing to overlook those flaws. Best of luck!

[catjones 1,658]

11 hours ago, WallE said:

You didn't mention any search criteria, so I suppose that you just took all flats in that area, regardless of price, size, number of rooms etc.

 

That was "understood".  I can't enter your criteria.