Making an offer to buy!

welnik

I looking at buying a house which has been on the market since the beginning of November. Its currently vacant as I believe it was purchased to be let out. Its not in tip top condition and needs a new bathroom, refitted kitchen, new windows and all in all, about £25,000 - £35,000 spending on it. It was up for £185,000 and has recently been reduced to £180,000. Immaculate houses in the road go for £200,000 - £220,000 when refurbished to show home standards so I think £180,000 is a bit over the top.

My first time buyer house was brand new so I have never really been involved with "making offers". How much should I go in at? I suspect that builders have made offers in the past at a lot lower than the guide price. Obviously if I buy it, its going to be rather inconvenient as we are going to have to live with the works being carried out. Its not worth all the inconvenvience of doing it up if its just worth £210,000 when complete. I might as well buy one already done up!

Anyone any advice?

Pal

Offer what you think it is worth to you. The worst that can happen is they say no. Try £160k (if you think it is worth that). If they say no, you can consider increasing it or you can walk away.

Presumably you have the £25,000+ in cash to be able to afford the work that needs doing, as you won't be able to borrow it until the work has been done.

welnik

Pal wrote:

Offer what you think it is worth to you. The worst that can happen is they say no. Try £160k (if you think it is worth that). If they say no, you can consider increasing it or you can walk away.

Presumably you have the £25,000+ in cash to be able to afford the work that needs doing, as you won't be able to borrow it until the work has been done.

I would be borrowing less than 75% of the property value due to equity from my current house.

I think house prices are on the way down. My friend paid £200,000 for her house and next door but one in the same condition is up for £175,000. Its definately a buyers market at the moment. Im lucky as my house is easily affordable by a first time buyer and Ive been in it 17 years, so very little mortgage.

ukbondraider

Of course it depends on where you are in the country and the exact situation of the vendor but in my experience if a house was up for £185 and then reduced to £180 the minimum the vendor will take is usually £2K off so £178K.

I will be surprised if the vendor will accept £175K let alone £160K but like Pal has stated there is no harm trying.

Just dont get your hopes up on what people say on these boards.

Let us know what you decide to offer and if it is accepted or not.

welnik

Been doing a bit of investigation and things are not quite as they seem. On the website of the estate agents they have stated "property believed to be freehold", according to the Land registry it is actually leasehold.

On contacting the local council, the extension to the kitchen has never been approved by the them. The way it has been done is not satisfactory anyway and could be construed as a fire hazard as the alley way at the side is far too narrow. This would have to be partially demolished and rebuilt.

One of the reasons for buying this property is the potential to extend. On looking at the council's website, it lists all approved planning permission going back to 1982. There are houses in the road that received planning permission to build over the garage, but not one of them has actually carried it out. I suspect that the owner of the lease has put the blockers on it.

Im wondering whether this house has already received offers in the past and the offeror has pulled out due to the above. It is a really small house and desperately needs an extension.

welnik

ukbondraider wrote:

Of course it depends on where you are in the country and the exact situation of the vendor but in my experience if a house was up for £185 and then reduced to £180 the minimum the vendor will take is usually £2K off so £178K.

I will be surprised if the vendor will accept £175K let alone £160K but like Pal has stated there is no harm trying.

The house has a school in the top 5% of the country and people buy houses there to get into this school. The owner lives about 10 miles away, well out of the catchment area, so my suspicion is that he bought it for this reason and has been renting it out.

He paid £120,000 for it in 2002 and I dont think he has done any work to it as its very 70's and needs gutting. Houses that are immaculate are going for around £200,000 with good sized ground floor extensions. It needs £30,000 spending on it.They are very small houses. Most have had ground floor extensions, but none have built at the side over the garage which is odd as quite a few have had planning permission to do so. Its been on the market since 1st November.

It has recently been reduced by £5,000. Don't know if this is the first reduction or not as we have only recently started looking to buy.

Doozergirl

You should establish whether it is Freehold before you make your offer. Also consider the possibility that by extending over the garage where others haven't, that you could be overdeveloping and won't gain back what it costs.

I can't see you getting this property at a good enough price for you to proceed with the work without a hefty drop from asking and it's already being marketed at considerably less than it's potential value. It's lovely to have a house where everything down to the taps is to your taste, but is it worth it if you're not making any added value? I would also be concerned that if it is that outdated, the very fabric of the house is going to need work. I'm assuming though that you've included these works and the extentions in your budget because your budget is huge!

Ian_W

Doozergirl wrote: I'm assuming though that you've included these works and the extentions in your budget because your budget is huge!

Yup, for new kitchen, bathroom and windows I'd have thought nearer £10-15K max.

Few of other points:
1. Kitchen extension may not have needed PP, permitted development of 10% allowed w/o pp on houses [not flats] but should still have building regs.
2. Don't know how a narrow alleyway is a fire hazard. If it has means of escape to rear shouldn't be a problem and you can't get a narrower gap than when houses are joined to each other!!
3. If leasehold can't see why L/her would block extensions over the garage. My l/her can make a reasonable charge for permission - but not for refusal!! More likely over-development as doozer says or possibly need to strengthen foundations to take the weight makes it more expensive IMO.

welnik

Ian_W wrote:

Yup, for new kitchen, bathroom and windows I'd have thought nearer £10-15K max.

Few of other points:
1. Kitchen extension may not have needed PP, permitted development of 10% allowed w/o pp on houses [not flats] but should still have building regs.
2. Don't know how a narrow alleyway is a fire hazard. If it has means of escape to rear shouldn't be a problem and you can't get a narrower gap than when houses are joined to each other!!
3. If leasehold can't see why L/her would block extensions over the garage. My l/her can make a reasonable charge for permission - but not for refusal!! More likely over-development as doozer says or possibly need to strengthen foundations to take the weight makes it more expensive IMO.

Point 1. Good point - I'd forgotten about that, you're right. When we were looking round, the estate agent lead us into the garden, she was practically sideways when walking down the alley. If there was a fire that stopped you getting out the front of the property and you had a disable person in a wheelchair, they would not get out. When we built our extension a couple of years ago, we were forced to replace twoo windows because they were 2 inches shorter in width than they had to be as it was a "fire risk". I was not best pleased. Apparently, a larger person would not escape!
Point 3. Im going to contact the leaseholder (or are they the freeholder?) today and see what they say. The houses on one side of the road all have side extensions and go for £250,000, but in this side of the road, none have done this to their houses?

Also, looking at costs.

Bathroom £2,500
Kitchen £7,000
Windows £7,000 (bay windows)
Garden (which is a jungle) £1,000
Garage door (woodern rotten things) £650
Frontage needs sorting £1,500
Front porch dilapidate £2,000

So perhaps not £30,000, but to do the extension that the others have done in the road, you can add another £7,000-£8,000. Immaculate houses in the road with the same extension go for about £200,000. So this is why I think £180,000 is too much!

Doozergirl

Building regs aren't retrospective so you won't have to put anything right, only make sure that new things comply. I doubt it would be necessary for Building Regs too require a certain gap at the side of the house, otherwise there would be no terraced houses! The window issue is for escape purposes rather than being a 'fire risk' in itself.

You should be rethinking your budget. Your bathroom, kitchen and window (assuming we're talking uPVC) budgets are way over for the size of property I think we're talking about and you're not looking at things like plumbing, electrics, damp proofing and subsequent replastering which are, IMO, going to need doing if the rest of the house is delapidated.

Can you get a builder to go through the house with you? You must be very careful that this house isn't a money pit, especially with your extravagent style of estimation

Tahiti

I can see your logic as to the figure you want to knock off the eventual worth of the house, but the kitchen for instance needn't cost that much if you work to a budget.

I know of three people (myself included) who have had kitchens fitted by professionals over the last two years, and the most expensive of the lot (including flooring, integral cooker, and recessed lights) was a chunk under £5k.

Adding an integral fridge, washing machine, and dishwasher would have made it just over £6k all in I reckon. And that was a large (16+ foot long), well fitted kitchen with nice worktops, and a breakfast bar, all fitted by a pro, with certificates for the electrical work. It wasn't done on the cheap, and the finish is impeccable (and includes everything such as tiled splashback except for about £20 for painting it DIY).

Best of luck with whatever you decide to do. If I were you, I'd get some trades people to come and estimate on the work you want/need done. You might find that other work could be done cheaper too. On the flipside, they might also point out other work that needs doing that you might have missed.