Advice on what to offer on a house that needs renovation please!

R&C

Sorry, I know that there are plenty of what to offer threads around, but we're really stuck!

Basically we have seen a house we like, it's an edwardian 3 bed semi, quite large with 2 receptions and a decent sized kitchen. The old lady that owned it has passed away and there are two beneficiaries. The house needs a complete overhaul - new windows, doors, kitchen, bathroom, rewiring, replastering/skimming (every room), carpets etc etc - you name it, it probably needs it!

The house is up for £225k, so i think they have allowed for some improvements in that price but not completely. It's probably a house that, in better order, would be pushed down to 250k due to the stamp duty threshold. We have seen another house in the same area (although not such a nice part i guess) which although is a little smaller, it has the added bonus of a driveway and doesn't need so much work doing to it, and that's on for just 5k more at £230k.

The agent tells us he had 2 offers, one was rejected and the other is still being considered - by the sounds of it they're holding off making their decision until our bid comes in as they know we're interested. After our first viewing we decided we'd start with a cheeky £202k, but now after our second viewing last night I'd be tempted to start even lower as we noticed so many more things that may need doing.

I think we're struggling so much because we're complete novices, we can only estimate the cost of the work that needs doing. At the moment we think it will cost in the region of 40k, what would you offer for this house on that basis?

Thanks

pawpurrs

Sounds an expensive job! You may be way better off with the one that needs much less work!
Considering the price the other one is on for this one does seem expensive! So a cheeky offer isnt actually that cheeky, sounds to me more like the asking price is unrealistic. Are you happy to live in a house that will be a building site? Rewire, replastering, kitchen, bathroom its a lot of stress?

R&C

pawpurrs wrote: »

Sounds an expensive job! You may be way better off with the one that needs much less work!
Considering the price the other one is on for this one does seem expensive! So a cheeky offer isnt actually that cheeky, sounds to me more like the asking price is unrealistic. Are you happy to live in a house that will be a building site? Rewire, replastering, kitchen, bathroom its a lot of stress?

Thanks for your reply!

I think the one for £230k is a bit of a one off, we have been looking around for just over a month now and houses like that are usually on at about £240-£250k. Even so, we don't like it half as much as we like this one I think we want a bit of a challenge!

We would hope to move in with the mother in law for a month whilst the rewiring, platering and bathroom gets done. The kitchen, although old and basic would be ok for the meantime and would probably be the last thing we do.

It's just so difficult - we really want to offer a price that allows for the work to be done and the future drop in the market also.

Pee

Have you looked up what they paid for it?

It sounds to me like you think it is worth £250k once it has had £40K worth of works. So it is currently worth £210k. Therefore I think your offer of £202 is worth going for.

The sellers will either try to get as much as they can for it, or decide that they will hold onto it. (Interesting, if it needs renovation is this because the occupier recently died? Were the sellers doing it up and don't have enough money to continue?)

You want to offer what you can afford and can live with, because if you offer less than the next person is prepared to pay/ the seller is prepared to accept then you won't get the house.

It's a bit like bidding on Ebay, but with bigger figures....

R&C

Pee wrote: »

Have you looked up what they paid for it?

It sounds to me like you think it is worth £250k once it has had £40K worth of works. So it is currently worth £210k. Therefore I think your offer of £202 is worth going for.

The sellers will either try to get as much as they can for it, or decide that they will hold onto it. (Interesting, if it needs renovation is this because the occupier recently died? Were the sellers doing it up and don't have enough money to continue?)

You want to offer what you can afford and can live with, because if you offer less than the next person is prepared to pay/ the seller is prepared to accept then you won't get the house.

It's a bit like bidding on Ebay, but with bigger figures....

Hi, thanks for your reply.

Yep the old lady who lived there has passed away, and there's no record of it on nethouseprices.com so I assume she's lived there a long while. The houses on the road are all different so vary a lot in prices, the only other we can compare it too really is another edwardian semi that sold for £215k in October 2003, although we have no idea what condition it was in.

So I'm thinking that if £210k is our max, then we should start the bidding at £195k? I guess time will tell, the agent should reject our offer if it's too low I assume on the basis that the other bidders bid is higher than ours?

QTPie

Hi

This is really difficult - especially if you don't have experience of building work... Do you have any good friends in the building trade who might be able to go and view it and give you an idea?

Estimating is difficult: just looking over the property, you could easily miss things that could be costly (what shapes are the roof, windows, DPC in?). You should get a good survey - if your offer is accepted - and that should allow you to renegotiate a bit on the price (if there are problems that you didn't foresee).

It is really difficult... I am a bit of a perfectionist, but looking at houses on the market now, I am realising that MANY need from some to quite a lot of work to bring them up-to-date. I am beginning to realise that potential & location/plot are more important than it being a finished product already. Sometimes those can be worth putting up with a basic kitchen or a bit of bad decor/carpet for a little while... BUT you don't want to overpay.

Are you in a goot position? FTB or chain-free buyers? If you are really STRESS that when you offer: the other people offering may not be in as good position. If you haven't already done so, go and speak to some mortgage people today. Plus avoid offering round numbers - many people will offer £195/£200/£205k: offer £197,750/£202,750/£206,750 instead.

Good luck
QT

R&C

Thanks QTpie!

Unfrtunately we don't have any friends who are in the trade, it would be so much easier if we did!

The roof looks in good condition, the windows are single glazed and some of the frames will need replacing by the looks of it. We suspect damp in the main bedroom, coming in from the outisde. We would definitely get a full structural survey done, and hope nothing nasty comes out of it!

Position wise, we have a buyer for our flat who is a FTB so it is moving nicely. I don't know if the agent is being truthful but he said the other bidders have no chain at all. Excellent tip re bidding non-rounded numbers!

QTPie

Full structural survey sounds good - best to know what you are dealing with and be able to negotiate a bit.

How far along is the sale of your flat? Are they at the survey stage yet? Might be worth checking with your EA and Solicitor for an update (and making progress clear when you make an offer). Definitely stress any good points (like how far along you are with your sale, that you have already spoken to mortgage people etc).

Good luck
QT

mlz1413

I would ask the EA if you can take a builder round with you, use a local general builder, can a friend recommend someone they have used or even ask the EA. A builder will spot things you won't and can give you a ball park figure so you know if the £40k is realistic.

Definately get a structrual survey as this will advise you if its worth actually going through with the sale.

As for price if your bid is not accepted then it's not meant to be, on a house that needs so much doing it's pointless pushing yourself to the limit and then living in a half finished house doing work with every pay cheque.

Re moving in with MIL for a month, ensure you can get the builder, electrican and plumber all at once or this time could run into 3 months easily.

Otherwise good luck, i've done up a run down place and it's really rewarding.

Entertainer

£40,000 sounds alot for a basic refurb.

Ultimately, it comes down to how much you want to buy. Prices are falling so another 10% off over the next six months means £20,000 off the price. Today's bargain is tomorrow's market price.