Buying too high a price? Advice needed...

ej_03

Hi,

Basically, I had an offer accepted on a property last Fri which was 6% under the asking price. I initially put in an offer of 11% under the asking price and was rejected and after some negotiations through the agent, the vendor came back with a final price of 6% under the asking. But now I am starting to think that I might have been too anxious and pressured into buying this place.

1. The property was up on Wed and I was the first one to view it and I put in an offer straightaway as I was looking for a long time in this area and this one ticked the relevant boxes and best thing was that it didn't need work. (1st mistake I think)

2. When the vendor came back with the final price, it was Fri evening abt 6pm. And the agent said that there were other viewings on Sat and if I agreed to the price, then they would cancel the other viewings. So I decided to take it as I was afraid that someone would come along and offer slightly higher say £1-2k and I might lose it. (2nd mistake)

3. I have come to hear from another agent that a similar property on the market had offers way below the initial offer I made on this property. The other property has better views but needed work and was at a higher asking price which is why I didn't bother offering on it. But the agent called me today indicating the owner is willing to take 8% under the asking price making the similar property only 3% higher than what I am currently paying. This is without me even making a firm offer and negotiating etc...

So now, I am seriously starting to think I might have over-offered and been too anxious in taking the vendor's final price. After all, if the property with better views had only offers UNDER my INITIAL offer, I shouldn't be paying a higher price right? Could someone pls advise? I am not sure what to do as I still like the property I have offered on but am wondering if there is room to go back to the seller and negotiate for a lower price. But from a seller's point of view, he might get really upset and not even want to sell to me anymore!!! Although I guess I could then go for the other property, but this one works for me as I don't have to do any work which is crucial as I need to move by Sept.

cathymw

I think you should remember you are buying a home and not just trying to get the best price on the properties for sale. Of course you want to pay the minimum price for your home, but way up the pros and cons of the two properties (better views vs needs no work by the sounds of it) rather than the 2% or 6% saving... Where will you be happiest living?? Wouldn't you end up spending more on the place that needs work doing on it? Which is the best deal - not necessarily the cheapest remember!Hope this helps.... BTW I don't think mistake number 1 or 2 are actually mistakes. Only you can decide if number 3 is a mistake - ie have you put an offer on the wrong home for you?

penguine

A spokesman from the Rightmove website was on Radio 4 the other day saying that properties listed there are going for, on average, 30% below the asking price.

Given the short amount of time it was on the market and the fact that you rushed into your decision, it sounds like you may well have offered too much. Even if you like the place and regard it as a home rather than an investment, if you've made a mistake you're going to be paying for it every month for the next 20-odd years.

Moral of the story: don't let estate agents rush you into making one of the biggest financial decisions of your life!

MyLastFiver

If that is the house you want, then stick with your offer. If the seller is not willing to consider a lower offer, then there is no point in offering one unless you are prepared to walk away from the house.

Prices might fall in the short term, might rise in the long term, but a few grand either way will make little difference in the long run. As the previous poster said, try to think of your house as a home not an investment. Living somewhere you like is the important thing.

ej_03

Many thanks for your quick responses.

I know abt the property being a future home etc... Issue is that there is a possibility that OH might be posted overseas in the next 2-3 years and so we want to get something here that we don't mind staying in but would also be a possible investment if we do leave the country. Having said that, there is also a chance we might not be leaving the country so buying somewhere to live makes sense especially since the prices are now within our reach. Which is why we are so concerned about pricing as that is our most important priority.

As to which house I like, I actually preferred the one with the views but as I said, pricing was our main concern so we decided to offer on the other property which cost less and didn't need work. This was especially since there is an insurance claim going through for the other property as there was a leakage in the bathroom and the vendor is going to put down new floors throughout. But he is not changing the bathroom, which we feel could be a source of future potential problem and so if we were to buy it, we would probably change it thereby adding to more costs.

ej_03

Which brings me to my dilemma if I should go back to the current seller and ask for a reduction in price and risk losing the property which I am reluctant to as this is definitely one of the best I have seen and which I thought was priced to sell (but obviously not since pple are offering way lower than me). But then again, if I go ahead, I will feel that I might have over-paid....

If I do walk from the property, I am thinking that if the vendor doesn't find anyone else in the next few weeks and the property is still on the market, is there a chance he will take a lower offer from me? Or by walking away from him once, he might just ignore me even though I might have the best offer at that point in time.

Thrugelmir

Sounds like you need to decide what you want to purchase. If your OH gets an overseas posting then buy a house which you could easily let. Thats if you wish to retain a home here.

Your dream home may not provide enough rental income to cover the mortgage in the years to come. And in the short term houses aren't necessarily a good investment.

carolt

You almost certainly did over-offer.

Can you do anything about it now? Probably not, unless you don't mind losing it and ae happy with the other house. You could try changing your offer now, but risk !!!!ing off the vendor to an extent that you lose the house.

You could wait until the last minute and gazunder - you might well get away with it, esp in a falling market..or you might not, and lose the house again (and your costs).

It really depends how much you like this house and if you'd be (a) upset or (b) secretly relieved to lose it and have to go for the other one.

Third way occurs to me - tell the vendor of the house you've offered on outright that you prefer the other house and have just found out can get it for the same amount/less, but if he'll accept 5K (or whatever) less, you'll stick with your offer. At least it's honest. But don't do this if this is the house you really want, in case the vendor takes the hump. Given how long the house has been on the market (ie not very) s/he might just decide you were a timewaster and put it back on the market. Or not.

Good luck. Tell us how it goes!

Rockporkchop

I would stick with your decision - if you loved it enough to offer straight away on it, you have been looking for a while and it is crucial you move by September then it is probably the right property for you. If you need a quick move then I would definitely stay away from any property with insurance claims or damage etc.

I know you say cost is the main concern but as MyLastFiver says, a few grand either way (in the huge money pit that is property ownership) makes hardly any difference in the long run.

I don't think that you have over offered. If I was the seller I wouldn't have accepted an offer of 11% below asking price when the property had only been on the market a day - I would have at least wanted to test it for a week or two.

charliee_3

Dont worry too much... if you are sure you want to buy the house get a good surveyor, i'd employ one youself rather than just rely on the mortage company.. and see what they come up with for the valuation...
if they find any work that needs doing,or its severely over the value in their opinion it gives you a good reason to re-negotiate based on their findings..the vendor will either come down and probably meet you half way, or you will have to pay the agreed price or lose the sale, but you will have only 'lost' the survey fees instead of paying way over the odds for the house.
.. this is common practice... if they say say its all lovely and worth the money then you have made a good choice and you can be happy in your new home..

ej_03

Many thanks for all your responses. I have just come back from taking a look at the house I offered on and OH and I have decided that we still like the place even though we might be paying a little too much.

But we are thinking of going back to the vendor and ask for a slight reduction of £5k as we noticed that there was some work needed to be done, eg the washbasin is cracked and needs replacing, lights in the bedrooms don't work and switches are falling out etc... I know it is just cosmetic work and not going to cost a lot which is why we are asking for just a slight reduction.

Also, the agent asked us today if we wanted to purchase the furnishings from the vendor as the vendor asked her to check with us. Going by this, we are thinking that the vendor possibly doesn't need or want the furnishings as it was a buy-to-let and it would probably cost more to remove the items as he has huge cupboards, bedroom suites, etc that would need moving. So we are also thinking of asking him if he would throw these into the sale as after all, he doesn't need the items and would need to pay to remove and possibly store them. So by saving on these items, at least we would feel ok with paying a higher price as we did budget for these items in the first place.

What do you think?