Advice on sensible offer

ardz_2

Ok peeps, here’s the dealio:

My GF and I are looking at 3 storey 3 bedroom town house (brand new) in an area up here in the NE of England. Area is ok – not great but not exactly bad. My sister bought a terraced house in the area a few years ago – it’s an OK area. House has built in garage with drive and lawn.

-First time buyers

-I have a mortgage offer in place which would cover the asking price with 5% off, I’m wanting a real bargain here however

-I have a large deposit

-They want 137K on a 75% shared equity scheme or 129K without the shared equity scheme. Stuff shared equity, we’re not doing that

-I’ve heard the sales woman saying they have 5% to play with on the asking price, but there may be more.

-Plot of about 22 houses, only 3 appear to have been sold. Plot has been up for at least a year as far as I know.

Does anyone have any thoughts on sensible first offers? I’m thinking 95K :cool: considering the factors above and current market conditions.

Thoughts greatly appreciated.

poppy10_2

95k is a bit generous - I'd go sub-90k

Premier_2

Advice on sensible offer - not on this forum mate.

Seriously, try elsewhere.

monkeymaster

ardz wrote: »

Ok peeps, here’s the dealio:

My GF and I are looking at 3 storey 3 bedroom town house (brand new) in an area up here in the NE of England. Area is ok – not great but not exactly bad. My sister bought a terraced house in the area a few years ago – it’s an OK area. House has built in garage with drive and lawn.

-First time buyers

-I have a mortgage offer in place which would cover the asking price with 5% off, I’m wanting a real bargain here however

-I have a large deposit

-They want 137K on a 75% shared equity scheme or 129K without the shared equity scheme. Stuff shared equity, we’re not doing that

-I’ve heard the sales woman saying they have 5% to play with on the asking price, but there may be more.

-Plot of about 22 houses, only 3 appear to have been sold. Plot has been up for at least a year as far as I know.

Does anyone have any thoughts on sensible first offers? I’m thinking 95K :cool: considering the factors above and current market conditions.

Thoughts greatly appreciated.

My advice would be to look at what similar properties sold for at the beginning of 2006 which is where we are now in terms of selling prices - asking prices are just pie in the sky. Once you have an idea of value, you need to consider how far prices are going to drop and factor it into your offer. I'd say you want to be looking at prices dropping to around 2003 levels.

brit1234

Well done on seeing that shared equity is a scam. Both Shared Equity and ownership are just devices to keep prices high.

Personally I would wait a year. Prices will be on average 20% down by Christmas based on curent trends of around 1.7% falls a month. So you could get a property 30% cheaper by June and thats with out a cheaky offer.

Another consideration should be the stability of the large building companies. In the last 2 weeks the riskiest banks have gone under or been taken over, the same is for the building companies. They have increasing debts and their share values are plummeting. It is only a matter of time (say within 6 months) before they go down which will mean a significant drop in newbuild prices which till now have been artiffically kept high with decieving deals compared with the collapsing 2nd homes.

Good luck.

the_worried_one

ardz wrote: »

Does anyone have any thoughts on sensible first offers? I’m thinking 95K :cool: considering the factors above and current market conditions.

Thoughts greatly appreciated.

I would imagine that 95k is a good offer. Whether or not they accept it though is another matter. The worst bit is wondering how little they would actually take if push comes to shove though isn't it? I dare you to go lower! lol!

Good luck.

oilit

the_worried_one wrote: »

I would imagine that 95k is a good offer. Whether or not they accept it though is another matter. The worst bit is wondering how little they would actually take if push comes to shove though isn't it? I dare you to go lower! lol!

Good luck.

You can work out the rough cost of building by searching on the web and working out what the cost per m2 is for the type of house and location. To give you an idea, down south If its in natural stone it could be as much as 1375 per sq ft, if it rendered it will be a lot lot cheaper.

Who is the builder? Are they puiblic? Are they struggling? If the answer is yes, then you will probably find that they need cash urgently and sales mean cash.

BEWARE

If your house is amongst many who have not been sold, or not finished, the value of yoru house will drop until the development is finished and completely sold (nobldy wants to live on a deserted estate or a building site!)

I would go for a really cheeky offer - 75% of asking price - they will probably be reluctant but tell them that based upon the above points (if valid) then you are taking a big risk.

the_worried_one

oilit wrote: »

I would go for a really cheeky offer - 75% of asking price - they will probably be reluctant but tell them that based upon the above points (if valid) then you are taking a big risk.

I will admit my math is not top notch but isn't 95k a touch below 75% already (asking price of 129k)? 90k is around 70%?

GDB2222

You haven't said what you think the house is actually worth. Asking price is irrelevant. Look at actual sales prices for houses that have been sold. don't look at new-builds because of all the bungs, so look at older comparable properties. www.nethouseprices.com

hethmar

I notice Wimpey is selling North London 1 bed flats at £175k (this weekend only!) down from £210k

Incisor

hethmar wrote: »

I notice Wimpey is selling North London 1 bed flats at £175k (this weekend only!) down from £210k

But next weekend, you get them for less than175 I am sure.