Homebuyers survey back - downvalued asking price, help!

tishbell

Hello,

I'm buying a house and have a dilema. The house is 1930s and we knew the survey would come back with something. However, having got the house for 250k, 25k under the asking price (whether that was a fair asking price is another matter), we were concerned that if anything did come back the vendors would not be intereted in negotiating.

There are a few things, electrics, gas, a bit of damp proofing (£700) and roof repair (£950), more under floor air vent bricks, and external joinery needs urgent attention.

The unusual thing is that the surveoyors have said that it is worth only 245k on the market. We have most the reports back looks like it might be 2-4 k's worth of repairs. We are not getting quotes for the windows and gas, as we knew they would need replacing. But didn't expect the other stuff.

So do we ask for the full amount of works off the new price (245k), or just for the money of the works?

Many thanks! We will need to make a decision very soon!
:A

tishbell

Just to explain, this was a private survey so does not effect the lenders decision. We had a free valuation with the lender, so decided to pay for a private Homebuyers suryey....

Fire_Fox

You mean you had a Homebuyer's Report not a structural survey? What did the lender's valuation come out as? Have you researched recent sold prices of similar houses in the area?

shirlgirl2004

We were in a similar position recently. The house was downvalued and had works needed that we had not envisaged. It turned out that we got 1/5th of the drop in value off the price and no money for the repairs. You can try to get money off but you need to work out how much you value the house.

tishbell

Yes, homebuyers survey.

Good point, the basic survey said it was 250k, So I'm thinking about just asking for the amount of the works off. Does that sounds reasonable? Hasn't been much sold on that road since 2007, but prices seem to be around 250k then...

confused31_2

tishbell wrote: »

Yes, homebuyers survey.

Good point, the basic survey said it was 250k, So I'm thinking about just asking for the amount of the works off. Does that sounds reasonable? Hasn't been much sold on that road since 2007, but prices seem to be around 250k then...

It sounds like they priced it quite well, if houses were being sold in 2007 for 250,000 and people are still asking the same it must be a crash proof road, or the buyers must be very nieve.

Framps

confused31 wrote: »

It sounds like they priced it quite well, if houses were being sold in 2007 for 250,000 and people are still asking the same it must be a crash proof road, or the buyers must be very nieve.

This comment is nieve [sic], if it assumes that these are the only two scenarios whereby a house could be worth the same value today as other houses sold in 2007.

Houses on any given street can vary in terms of style, size, quality, garden size, proximity to shops / transport links etc. The price of other houses in the area gives you a guideline but can give you no more unless you know the specifics of every house. Equally each house is valued on its desirability by the purchaser, thus no two house valuations are alike. Moreover, the fact that no house sale info is available since 2007 makes the use of LR data much harder in this case... flippant comments reflect the naivety of the poster in utilizing statistical data.

Good luck with the purchase tishbell - your plan of asking for a reduction equal to the works sounds reasonable to me.

typeractive

How I would approach this (regardless of the value of the property being over market rate etc). I would try this approach:

"Our reports have came in under the agreed asking price (X amount of pounds), and the following works need addressing XYZ. We are still interested in the property and propose that either you arrange for the work to be carried out, or come to an arrangement on the asking price. Please bear in mind we have already budgeted that the property will need ABC work doing it (such as the windows that you already mention), which we are prepared to accomodate - but with the extras identified we can not accomodate all these extra costs".

...or words to that affect. Bascially informing them you are already going to incurr costs, but you have now found others and are not / will not be able to finance everything. It's a problem they are likely to face with any survey (again you can tell them that). Also state "as soon as you decide what you want to do, we will be ready to further progress with the sale - thanks".

If they want shot of the property quickly they will drop the price. If they're holding out for the best price they might not. How long has it been on the market? Do you know?

confused31_2

Framps wrote: »

This comment is nieve [sic], if it assumes that these are the only two scenarios whereby a house could be worth the same value today as other houses sold in 2007.

Houses on any given street can vary in terms of style, size, quality, garden size, proximity to shops / transport links etc. The price of other houses in the area gives you a guideline but can give you no more unless you know the specifics of every house. Equally each house is valued on its desirability by the purchaser, thus no two house valuations are alike. Moreover, the fact that no house sale info is available since 2007 makes the use of LR data much harder in this case... flippant comments reflect the naivety of the poster in utilizing statistical data.

Good luck with the purchase tishbell - your plan of asking for a reduction equal to the works sounds reasonable to me.

you can say that, by me there are semi detached houses priced at 250,000 pounds, the last house sold down the road was 2006 it was detached and a lot bigger and it sold for 235,000.

Now a mortgage valuation will never value the property higher and depending how much equity people take from their previous property, it doesnt really matter as long as the bank know the preoperty is worth more than what than what the purchaser owes the bank.

For instance if someone is buying a house, as a 80,000 pound deposit and the house is 160,000, the bank will be happy as long as they know its worth more than the 80,000 pound they are lending.

Basically a mortgage valuation is done by the bank so they know the house they are lending the money for is worth what they are lending and protecting themselves, its not for buyers to knock down prices.

confused31_2

typeractive wrote: »

How I would approach this (regardless of the value of the property being over market rate etc). I would try this approach:

"Our reports have came in under the agreed asking price (X amount of pounds), and the following works need addressing XYZ. We are still interested in the property and propose that either you arrange for the work to be carried out, or come to an arrangement on the asking price. Please bear in mind we have already budgeted that the property will need ABC work doing it (such as the windows that you already mention), which we are prepared to accomodate - but with the extras identified we can not accomodate all these extra costs".

...or words to that affect. Bascially informing them you are already going to incurr costs, but you have now found others and are not / will not be able to finance everything. It's a problem they are likely to face with any survey (again you can tell them that). Also state "as soon as you decide what you want to do, we will be ready to further progress with the sale - thanks".

If they want shot of the property quickly they will drop the price. If they're holding out for the best price they might not. How long has it been on the market? Do you know?

I would just explain to them that you have had the survey done and certain work needs doing, ask them for the reduction and if you feel that strongly about it say if they dont reduce you will walk.

Its up to you, you have got nothing to lose, good luck and i hope you get it, when we bought 10 years ago are house needed a rewire, and we got that knocked of the price.

good luck

tishbell

Hi Typoactive,

They seemed to want the sale to go through quickly, hence dropping the price buy £25k to secure us as buyers, The only thing is, we have heard that the house they are buying has tenants and may need to give them 2 months notice, even though everything else is ready to go now on our purchases. It maybe sooner but we are waiting to hear.

This would not be a great position to be in, as if they know there is 2 months to wait and we are asking for a reduction, they may as well put it back on the market. There is nothing comparable on the market for the price we are getting it for, and prices may have even gone up slightly.

I like what you wrote, not saying exactly how much, but letting them make the decision. Have you used this tactic before? I imagine it is slightly more riskier than just saying, look give me the money for the repairs and we will exchange..

With regards to other house prices on the road, it is a tough one to call. There are 3/4 that have gone for 250k from 2005 - 2007, so it dosen't really tell us much. Also theres a couple on sale now, one on the side we are buying for 270k and one on the other side (better side) for 295k.