Offer rejected on overpriced property, any advice?

[stouffer]

Hi, I'm new to the forum and need a bit of advice.

I've seen a house I like up for £369,950. Its a 3 bed semi and I think it may be overpriced as a larger detached version across the road was recently up for £349,995.

The agent said said the owners were going through a divorce and wanted rid of the house asap. She also agreed the price was high and said that the owners were told to consider a price drop. We're in a good position having just sold to FTB who want to move in asap and have we have a mortgage ready.

The property is 13 years old but was extended to make a dining room and bigger lounge 7 years ago. There are cracks showing in the plaster where the house and extension join. The ceiling of the original house is artexed but the extension has a smooth ceiling meaning half the lounge is artexed and the other isn't which looks weird and means more expensive plasterer work. The whole house needs recarpeting, the cream carpet looks worn and dirty and there are actually obvious stains and cigarette burns. The whole house needs a cosmetic facelift and looks tired, it has 3 bathrooms which are all originals and the main bathroom would need work at the very least. The kitchen is also the original and is very small considering the size of the property and needs tearing out and replacing, the cupboards were wonky. The built in garage has had a stud wall divider put in it which does not comply with building regs (vendor even said so). The garage also has a temporary ceiling which may need replacing.

We took a structural engineer (partner's brother) round and he said that there had been movement in the extension and he could only tell how bad it was by removing the carpet and plaster from the walls where it had been patched up. To investigate this, fix the problem, replaster walls and ceilings and refit the kitchen which is in poor condition, he suggested a market price of 20k. We'd obviously not have to pay as much as he's a family member and my partner could do much of the cosmetic work himself.

After lengthy conversations with the EA, explaining the estimate, explaining our good position, etc we put in an offer of 325k which the agent wouldn't even put forward. We eventually gave our final price of 335k which was put forward and turned down flat and told that 345k would be acceptable.

We could potentially borrow another 5k off a family member but I think 340k is too much for this house. 3 different agents have mentioned on separate occasions that the ex-husband is very difficult to deal with and often leaves the house in a mess before viewings. His ex-wife even said that he refuses do any viewings himself and is sentimentally attached to the house. I spoke to the valuations manager who said that he valued the property at a significantly lower price but the man insisted on 370k. The ex-wife has left with the kids and moved into rented and tbh I think he's quite happy living there and isn't in any rush to sell.

Well what next? The problem is there is very little in this area and we do really like this house. I was considering writing a letter reconfirming the offer and enclosing a copy of the builder's estimate. What do you think? Any other suggestions?

[drhouse]

Originally Posted by stouffer

Hi, I'm new to the forum and need a bit of advice.

I've seen a house I like up for £369,950. Its a 3 bed semi and I think it may be overpriced as a larger detached version across the road was recently up for £349,995.

The agent said said the owners were going through a divorce and wanted rid of the house asap. She also agreed the price was high and said that the owners were told to consider a price drop. We're in a good position having just sold to FTB who want to move in asap and have we have a mortgage ready.

The property is 13 years old but was extended to make a dining room and bigger lounge 7 years ago. There are cracks showing in the plaster where the house and extension join. The ceiling of the original house is artexed but the extension has a smooth ceiling meaning half the lounge is artexed and the other isn't which looks weird and means more expensive plasterer work. The whole house needs recarpeting, the cream carpet looks worn and dirty and there are actually obvious stains and cigarette burns. The whole house needs a cosmetic facelift and looks tired, it has 3 bathrooms which are all originals and the main bathroom would need work at the very least. The kitchen is also the original and is very small considering the size of the property and needs tearing out and replacing, the cupboards were wonky. The built in garage has had a stud wall divider put in it which does not comply with building regs (vendor even said so). The garage also has a temporary ceiling which may need replacing.

We took a structural engineer (partner's brother) round and he said that there had been movement in the extension and he could only tell how bad it was by removing the carpet and plaster from the walls where it had been patched up. To investigate this, fix the problem, replaster walls and ceilings and refit the kitchen which is in poor condition, he suggested a market price of 20k. We'd obviously not have to pay as much as he's a family member and my partner could do much of the cosmetic work himself.

After lengthy conversations with the EA, explaining the estimate, explaining our good position, etc we put in an offer of 325k which the agent wouldn't even put forward. We eventually gave our final price of 335k which was put forward and turned down flat and told that 345k would be acceptable.

We could potentially borrow another 5k off a family member but I think 340k is too much for this house. 3 different agents have mentioned on separate occasions that the ex-husband is very difficult to deal with and often leaves the house in a mess before viewings. His ex-wife even said that he refuses do any viewings himself and is sentimentally attached to the house. I spoke to the valuations manager who said that he valued the property at a significantly lower price but the man insisted on 370k. The ex-wife has left with the kids and moved into rented and tbh I think he's quite happy living there and isn't in any rush to sell.

Well what next? The problem is there is very little in this area and we do really like this house. I was considering writing a letter reconfirming the offer and enclosing a copy of the builder's estimate. What do you think? Any other suggestions?

It probably couldn't do any harm but if he is being stubborn and justs wants to spite the ex then it might not make a lot of difference. Sorry.

[faircloughspeed]

Hi there, Hope you are well!!!

Look the simple answer is this;

A property regardless of value is only worth what a buyer is happy to pay.

In essence its all about Valuation, your bank will conduct a valuation (for a fee) or included within your offer. Your bank will write a Valuation report based on the property dynamics ie age, specification, condition of property, competitor property for sale on a like for like basis, local and national expectations of the property valuation and trends.

However you may find the following web sites very helpful whilst completing your OWN market evaluation on the property price. I am new so not allowed to put links on here yet, however type in google either
nett house prices, mouse house prices or zoopla.

These all provide information as to Land Registry Sold Prices with in the area you are looking into.

You can then visit

a web site called upmystreet (put it in google and you will find it)

You would then look in detail as to the type of area, its classification, crime, services, transport, schools etc....

It is very important to be sure you know a great deal about the area before spending even £5 never mind over £300k.

You will then be able to look at what houses are selling for within the area (must be on a like for like basis), took at the % fall and rises within the area and the market place.

The problem is Estate Agents really do a fantastic job, however they represent Their clients interests and any discount you gain will also effect their margins.

However you can deal and present the evidence to the owner and push that your offer (Revised) of course is a True and Fair offer based on a number of factors you have investigated.

It makes NO right move in my opinion for you to purchase ANY property that the MARKET feels is Over Valued or Over Expectation on its actual worth.

You will have to wait much longer for ANY Capitol growth should you ever have any.

It is a buyer market and you must complete more research to UNDER pin the property that you offer on!!!!. Remember dont just fall in love with a property because you like the look of it. Look at how the property can also increase in value for you and all options that may reasonably enhance the property.

Your valuer will notice any movement within the plot and if needed you may need a build inspection/report.

I see so many buyer who simply just accept prices that sellers put forward and its all about active negotiation. You could save £1000's if managed correctly.

Remember YOU are so important to our property industry as a Buyer you should be looked after very well indeed. I hope you Agent is on the BALL as really they should be able to give you advice without any conflict of interest. The agent has you as their interest as well as they seller.

We call this a chain, and its important that a good quality negotiator will ensure all parties are happy with the offer. If need be invite you both seller and buyer to meet over a coffee in the agents office and talk out an offer.

The options really are endless..

I hope this has helped you a little. May I also say I have sold New Build and Existing Property for over 10years now, working as a Regional Sales Manager at the Broughtgreen Development in Manchester and featured on Channel M TV on Sky. So I like to think I know what I am talking about.

If you need any pointers I would be only too happy to help.

All the best and take care!!! Remember you could always buy new build and get Thousands knocked off the price, really!!! could be in excess of £15-20k, you just need to negotiate.

Stephen

[faircloughspeed]

(allegedly) You could knock on the door of the seller and ask for an informal chat. Once agreed the seller will advise the agent of the "agreed" sales price. remember any reduction effects their margins (allegedly)

[jodieB]

Originally Posted by faircloughspeed

(allegedly) You could knock on the door of the seller and ask for an informal chat. Once agreed the seller will advise the agent of the "agreed" sales price. remember any reduction effects their margins (allegedly)

Thats not a bad idea as the sellers dont know you from larry and just see a blank face and a selling price which is why they dont consider a lower price.
also if you can chat to them you can put your points forward as to why you put a lower price as it will cost you more on the repairs.

[drhouse]

Some good points above but where they are 2 sellers and the split has turned nasty one seller can dig their heels in and agree to nothing. It then takes a court order and even then there is no guarantee that will shift them. I know of one that has been going on for 5 years with both parties even refusing to talk to one another. I am afraid logic doesn't come in to it.
As to a lower price meaning a cut to the EA fees depends on if it is a percentage or a fixed fee being charged. Also no sale at all means no fee at all - I know which I would rather have. (at a 1% fee a drop of £10,000 means £100 less on the fee not a lot at this price of property)

[brian]

It sounds like a problem property, full stop. You need to ask yourself whether you really want to pay for what you feel is an over valuation, for a property that requires thousands in repair work, and may have difficulty completing because you are getting caught up in the middle of a divorce battle.

You make an offer you consider reasonable, go as high as you feel comfortable, and if they still will not accept, then consider you will probably find it difficult to change their minds.

[Chris Gough]

I think the visit idea would be a great start, you could find out what is happening in the divorce to ascertain whether they are really interested in a good offer. It may be not worth the hassle, would you not consider the larger detached house which you could possibly even get more cheaply? Good luck either way.

[DaventryMan]

Walk away.

BTW the Agent must pass all offers onto the seller. If you can prove he didn't you have the firm by the short and curlies!

[Kaz]

I also think you should walk away. Trying to buy a house from people who are divorcing can and often is fraught with difficulties. In this case, I don't have any doubt that it'll just drag on and on, costing you more and more, with no guaranteed happy outcome.
Apart from the obvious hassle, you might also lose your own buyers as they won't be so content to wait.