Your ceiling follows written assumptions, not a reaction to the seller’s price.
01Two questions, two answers
Market value asks what comparable buyers may pay. Your ceiling asks when the project meets your requirements. These figures may differ without either being necessarily wrong.
Do not erase the gap with an invented average. A property can fit its market and fail your objective. You do not have to buy it.
02Work backwards from income to capital
In a simplified example before tax and financing, €10,000 annual net income and a 4% target return imply a maximum total cost of €250,000. This includes assumed costs and works, not just the offer price.
This is not a property valuation. Rent, expenses, works and target yield are your assumptions: document them, then check their relevance with the professionals involved.
03Do not negotiate assumptions with a spreadsheet
Lower vacancy, higher rent and a forgotten quote can make almost any project work. New evidence should change an assumption, not a desire for a better result.
Record the date and source of each change. You can then distinguish a genuine improvement from simply relaxing your requirements.
04A sound exit from negotiation
An offer below asking is not a judgment on the seller. It states the terms on which you can buy. If refused, keep your calculations and continue searching.
You may have missed a property. You have kept your method for the next one.
Gather the documents before drawing conclusions. These educational materials do not replace a professional’s individual assessment.
Open the practical tools
