Before You Make an Offer on a House: A Checklist

Making an offer is where a house hunt turns into a negotiation, so it pays to arrive prepared. In England and Wales an offer is not legally binding until contracts are exchanged, which gives both sides room to change their minds. Work through this checklist before you commit a figure to the estate agent.

Get Your Finances Ready

• Get an agreement in principle first. Most lenders will tell you how much they are willing to lend before you have found a property. Our guide to what a mortgage agreement in principle tells you explains what it does and does not guarantee.
• Check the full budget, not just the asking price. Stamp Duty Land Tax applies in England and Land Transaction Tax in Wales. There may also be fees from your lender or a mortgage broker, plus final bills from your current home.
• Expect identity and funds checks. Estate agents are legally required to carry out anti-money laundering checks, so be ready to show a passport or driving licence and possibly proof of funds.
• Know what you will need at exchange. The deposit is often 10% of the purchase price but it can vary. Our guide to deposits and loan-to-value explains how deposit size shapes your mortgage.

Questions to Ask Before You Offer

• How long has it been on the market, and how long have the owners lived there? A long stay can signal room to negotiate, and old listings still online can show what the sellers paid.
• Is it marketed by more than one agent? It helps you gauge competition.
• Is there a chain? Chain status affects how quickly a sale can complete. Government reforms will require key information, including chain status, condition and leasehold costs, to be set out upfront in sales packs.
• How does the price compare with sold prices nearby? Research similar properties so your offer rests on evidence rather than the asking price alone.
• Does the agent earn a referral fee? If they recommend a solicitor, broker or surveyor, they must tell you about any payment they receive from that firm.
• Is the property leasehold or freehold? Ground rent can apply to leasehold property and service charges to a leasehold flat, so ask whether either applies and get the figures in writing.
• What does the energy performance certificate show? It sets out how energy efficient the property is and helps you estimate heating costs.
• Do any conditions attach to the property? Some specialist retirement properties carry conditions on their sale, and your solicitor will check the title for restrictions.

Surveys and Valuations

• Know the difference between a valuation and a survey. Your mortgage provider will carry out a valuation of the property before approving your mortgage, but a survey is what checks the property’s condition for defects.
• Consider a homebuyer survey. There are several types at different levels of detail; the MoneyHelper service sets out the options.
• Settle practical details with the seller early. Agree whether they will have the boiler serviced and which repairs will be dealt with before the sale completes.
• Treat survey fees as money at risk. If the sale falls through, you may already have paid for a valuation or survey, and for legal work your solicitor has started.

Making the Offer

• Put the offer in writing. You can make it by phone or in person, but follow up with an email stating the amount, your name and the property’s address. By law, the agent must pass every offer to the seller.
• Make it subject to contract. This wording leaves the figure open, so there is room to renegotiate if a survey uncovers a problem with the property.
• State your position. Being a first-time buyer, chain-free, holding an agreement in principle or being flexible on timing can make your offer more attractive without raising the figure.
• Decide your ceiling before negotiations start. Work out the maximum you will pay and stick to it. If your offer is rejected, do not rush to raise it until you have checked what you can sensibly afford and whether the property is worth more.

Handy tip

Confirm every offer, and any change to it, by email. A written record reduces the scope for confusion later, which matters most where several buyers are competing.

After Your Offer Is Accepted

• Ask for the property to be taken off the market. Requesting that viewings are cancelled reduces the risk of gazumping, where a seller accepts a higher offer after accepting yours.
• Instruct a solicitor or conveyancer. The agent will ask you and the seller for solicitor details, and the two legal professionals deal with each other directly.
• Expect local authority searches. Once your offer is accepted, your solicitor organises them, and you usually pay for the searches up front.
• Make your full mortgage application. You do not need one until you have found a property, so an accepted offer is the point to apply.
• Allow for delays. Buying a home takes about five months on average and longer in a chain, and nothing is binding until contracts are exchanged.
• Stay alert to fraud. Buying involves transferring large sums, so check payment details carefully before sending money and speak to your legal professional about protecting yourself from property fraud.

More on this site

• Before You Reserve a New-Build Home: A Checklist: the equivalent checklist for reserving a plot with a developer.
• Fixed, Tracker or Variable: How Mortgage Rate Types Compare: helps you choose a rate type before your full application.

Your questions

Is my offer legally binding once it is accepted?
No, not in England and Wales. The sale only becomes binding when contracts are exchanged, so either side can walk away before then.

Do estate agents have to pass on my offer?
Yes. By law an estate agent must pass every offer they receive to the seller, who then decides whether to accept, reject or negotiate.

How much deposit do I pay at exchange of contracts?
The deposit is often 10% of the purchase price but it can vary, and one official step-by-step guide puts the minimum at 5%. Confirm the exact figure with your solicitor.

What does ‘subject to contract’ mean?
It signals that your offer carries no binding commitment yet and that the figure can still change, for instance if a survey turns up a defect.