Can You Make Offers and Have Them Accepted?

Is it possible to have offers accepted on property in Valencia? It's a question we get asked often and it's a statement "You can get offers accepted easily in Valencia" that people with too much confidence in their own opinions make consistently on Facebook. However as anyone with a little bit of common sense knows making offers and having them accepted involves a degree of knowledge about the property market, the owner's situation and a whole lot of intangibles, some of which we will talk about in this article.

And where does this come from? Well, I was on a Facebook group the other day, yeah I know, I know... and someone argued that you can get really low offers accepted on properties in Spain by, *checks notes*, having cash available and being able to compete quickly. When pressed for any proof of this (because of course my middle name kicked in at this point, Mr Sarcasm) they said that he once heard "of an owner selling for 150k when they were asking for 300k but that was during the crisis about ten years ago" (It wasn't, it was longer ago) And another where "someone had sold a house somewhere for 250k when they were asking 350k".

I believe that this is known as "doing your research" in internet terms, two isolated incidents in a period of over ten years in which just shy of 1 million property transactions have occured in Valencia. Not a hugely encouraging or indeed high percentage really.

Now of course in a struggling market it's definitely possible to get an offer accepted, you just have to find a motivated seller. This is easy when interest rates are high, prices are falling, buyers are few and far between and the economy is struggling. However in a buoyant market it's more difficult to get offers accepted because owners are getting lots of visits to properties. And currently in Valencia the market is still extremely buoyant:

  • Plenty of demand
  • A hugely restricted supply with record low numbers of properties for sale in the city
  • Lowish interest rates looking to reduce further this year as Euribor shows signs of dropping
  • Record employment numbers in Spain with a burgeoning economy.

When you add this to the ever increasing numbers of remote workers able to work anywhere in the World then popular places like Valencia, often mentioned as one of the best places in the world to live and work, will obviously have more offers on properties meaning getting a lower offer accepted is difficult. Equally, when a market is moving up it's difficult to get offers accepted if the properties are priced correctly in the first place.

However, which way is the market moving? Some people think the market is going down, maybe because the market where they are coming from is heading down. Let's say now that the data is confusing but the general trend is up. The only question currently is how far up because...

All of the data on Spanish house sales always contradicts itself.

Why? Well, there is the report from the notaries about sales prices and there is the report from the property registry about sales prices and you would think they were the same as the registry reports on sales made in notaries but nothing could be further from the truth (Those figures don’t include any money paid in cash)

There is the report from Tinsa who value properties and other valuation companies too (but they don’t include sale prices)

Then there's the report from Idealista and the other portals such as Pisos and Fotocasa on asking prices (but they don’t include real sale prices)

The really reliable stuff is on the ground knowledge in an area but bear in mind that is taken from a lower number of transactions from individual estate agents, franchise groups and also industry bodies. If we took into account our sales only then prices in Valencia went up 25% in 2023 and this year so far they are up 23% but those figures are totally fabricated, the previous year they had dropped supposedly by around 8%. Now this is true for our completed sales but we have had many more clients over the Golden Visa limit in the last two years compared with previous years increasing the average sale price and in 2022 we got a lot more clients buying investment properties reducing the sales prices. So you can see from this how smaller sample sizes can give erroneous results.

What many prefer to do is to take all of the above, take an average and then guess, usually making a conclusion which suits their hypothesis of course. So let me tell you now three things that I definitely know about the market and they are important because they are related.

  1. Prices are rising. Official reports on price rises in the city of Valencia state an average 13% rise in the last twelve months and in certain areas such as Campanar prices have supposedly risen by 27.7%
  2. If you see something and think it's a good value property then so do others as there are so many buyers around and it won't hang around for long.
  3. To answer our question at the start of the article, can you get an offer accepted on a property? Due to rising prices, high demand and low interest rates it's difficult, possible at times but difficult. It always depends on the individual circumstances of the owner but currently there are fewer motivated sellers than at any time in the last ten years despite Covid, despite Ukraine, despite the Middle East and despite local political issues. To get the property you want you have to make your offer attractive to any seller and that usually means offering very near to the price and being able to complete quickly or be flexible in your timelines for completion if the seller requires more time.

Finding Those Motivated Sellers

We have written before about what you need to look for to find motivated sellers, the four Ds of death, disease, debt and divorce but today we will add some others that you may find that give you a motivated seller. Again all of them begin with a D so riffing on a theme here (And yes, I have contorted the language to get them all beginning with D!).


Deposit Contract

If someone has already found a property to buy and has entered into a deposit contract to purchase it then they are most certainly motivated as they may only have 60 or 90 days to complete their purchase. So if they need the money from their sale to purchase then they may well be motivated. In these cases as long as you yourself can complete quickly then it will save them a huge headache and possibly the loss of a large deposit payment so you might well get a decent discount.


Deception

Sometimes you will see in an advert that the owner is a motivated seller so you might make an offer. We have seen some of these recently but looked at the price and thought "Yeah, good luck with that!" The price on these is at least 10-20% above what it should be and it is placed there deliberately so the buyer thinks they have got a good deal by getting an offer accepted.

However, having an offer accepted on an overpriced piece of sh*t isn't great.

How do you spot these. Well usually it says in the advert "Abstenerse Inmobiliarias" (Meaning "no agents") Why might it say that? There are plenty of reasons including having had bad experiences with agents in the past but usually the reason is because the owner knows they are taking the p*ss with the price and they know people who want to avoid paying agency fees will contact thinking they have a great deal and are the cleverest person in the World. They aren't. There is a saying about that by Bertrand Russell.


Disputes

Somebody might be selling because of an ongoing dispute. That could be arguments with a neighbour, disputes over where the property's boundaries lie, a dog that never stops barking when the owners are out, disagreements with the builder or any other number of reasons. One of the things to be careful of here is the fact that they may be motivated by the dispute but at the same time they are unlikely to let you know there is a dispute; neighbours are angels, boundaries are clear, dogs are quiet once they get to know you and the builder who did the work was a paragon of virtue. Yeah, of course they were.

When you find out about the dispute you may have already bought the problem property and you can only make a claim against the owner if it was a "vicio oculto" (a deliberately hidden vice by the owner such as not declaring structural problems that are known about) Barking mad dogs and an upstairs neighbour who likes dancing and wailing to Flamenco at 4am don't count.


Deficits

A deficit is also known as negative cashflow. This might be a property that is costing the owner money every month maybe because their mortgage payments are not being covered by their tenant as the mortgage has gone up recently perhaps. Equally, there could be a building where the community has decided that some work needs doing and therefore the monthly community fee will be going up for a period of time and the extra money being paid out quarterly means the owner with be in deficit each month so they decide to sell to avoid that cost. Typical costs of this are lift installations, rehabilitation of the facade and pipework or repairs not covered by insurance.


Conclusion

In the current market it's difficult to find motivated or desperate sellers so don't expect to have lower offers accepted in most cases. This may change but as I write it's true. Also if your initial offer is too low the owner will never talk to you again. It's viewed in Spain as an insult to the person rather than a negotiation and not only won't they come down in price they won't sell it to you even if you came back with a full price offer! So be careful with offers but let us guide you. We managed to get a place for almost 20% off this week for a client but it's rare. The other deals we have made this week have been at asking price or very close. And even then they were all very good deals because the properties were priced right to start off with.


The Valencia Property Podcast

Our monthly podcat is out now, it was released yesterday. In it we talk about Visa Options, the Best Areas, Abandoned Spas and a Whatsapp Event we have coming up next Friday. Have a listen and join us next Friday as we answer everyone's questions about coming to Valencia. Twenty minutes of your time that will be very useful.


Property of the Week

Back to good old reliable L'Eliana for today’s listing. We’ve given our reasons for liking this town multiple times over the years (spoiler alert: there just might be something coming up in this week's podcast as well), but if you’re just tuning in then the amenities, bars, restaurants, public transport, proximity to Valencia would be the tl:dr (Have I used that right kids?).

When this house first came up I though it was a little overpriced, but it’s come down in price now and looks a good buy at the current price and when comparing with others in L'Eliana. 6 bedrooms and 3 bathrooms means it’s a great option for a family looking to move over and still requiring space for when the relatives decide to pop in. There’s a couple of doghouses in the garden should said relatives be of the “Ugh, I can’t believe we got to put this lot up for the next 2 weeks” variety.

While the interior could do with a little modernising, there’s no big tear-down jobs needed, rather deciding what personal touches you want to add to the space to make it your own. Along with a nice sized plot that doesn’t require constant maintenance and located just a 10-minute walk from L'Eliana town centre, this should definitely be added to your list of properties to visit once you arrive here. So, send this link to whichever one of us is dealing with you and we will arrange the visit pronto.


Our Whatsapp Q+A Next Week

You need to be in the group to participate but next Friday around 4-5pm Spanish time we are going to have our first Whatsapp Q+A. This is for everyone in our Whatsapp groups who get first news about price drops, blogs, podcast releases and new listings on the site.

How it will work.

At the start of the hour we'll be sending out a message to everyone in the group to start and you can get your question answered directly. I have put aside an hour to do this so there'll be no interruptions. As only we will see the questions we will be copying and pasting them with the answer into the group. If a longer answer is required then you might get a voicenote on it as my typing speed isn't 700 words per minute but I talk quite fast. Remember there are no stupid questions (Unless you are in certain Facebook groups where you will see there are plenty of stupid questions).

How Can You Participate?

Have your question ready and send it to us right at the start of the hour. However if you cannot follow during the hour send it beforehand on Friday and we'll make a note of it to answer in the hour. If you are not a member of our whatsapp group then send me a message on my whatsapp number 0034657994311 (Graham) and tell me your full name and I'll add you to the group beforehand. No questions are off limits and we'll do our best to answer everything in full.


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