a couple of questions from a ftb buyer

wigglyworm

hi
we are looking to buy a house soon, we have a mortgage in principle for 125k
but the houses we are looking at are for 129,950 is it possible to negotiate it down to our price. we could possibly stretch to 126k but do not want to pay stamp duty as ftb. if they agreed at 126k how could we avoid stamp duty, could we buy for 125k and arrange the extra 1k to be paid another way?
finaly at what stage do we have to show our mortgage in principle?
thanx

AndrewSmith

Hi,

You are correct that stamp duty kicks on at £125,000. Over this then you pay 1% of the purchase price up to £250,000.

It may be possible for youto negotiate down to £125,000 but this depends on the vendor, propery, location, what the seller's mortgage/situation is etc etc.

If they did agree to £126,000 and you wanted to pay £1,000 for 'white goods' etc this would have to be paid cash independanty of the mortgage. The mortgage will only be based on the official 'purchase price'.

There is no absolute requirement for you to show your agreement in principle. Some Agents will ask for it, some won't.

Andy

F_T_Buyer

You could offer £125k, and £1k for carpets (and other stuff for example), this would get you around the stamp duty threshhold. Although, these costs have to be reasonable.

But you're an FTB, and FTBs are like Gold Dust now-a-days. If I were you I would stick to your guns, and not be forced to pay too much!

lilyann1

I think anybody having their property on the market for £129950, has done that so they get an offer of £125K.They must know stamp duty kicks in at that level.

wigglyworm

thanx for the help
what do you think my opening offer should be considering my limit is 125k?
if an offer is accepted what are the chain of events that we have to follow next?
it is all very daunting and your advice is most welcome

F_T_Buyer

£120k = 8% less.

Then work up.

AndrewSmith

Agreed.

Begin at £120,000

lilyann1

Yes we had our on market for £279950 with 3 agents telling us we should get around £275k but be prepared to take £270k.I would agree and start at £120k and work way up to say £123K or finally £125K.It's hard haggling but sometimes it works out first time.
The house we're buying was on at £20k more than we offered first time and we finally got it for £15k less than the asking price.
Good luck

dougk_2

At £129k they are most probably aiming at getting £125k.
Similarly properties at £255 to £265k are aiming at getting £250k.
Its all a game builing in extra to be able to reduce and make everyone feel happy in a WIN-WIN situation!

Jorgan_2

Wigglyworm, you might want to check that the property isn't in a stamp duty exempt area, in which case it starts at £150k.

Before you put an offer in, establish how long it has been on the market, if its more than a couple of months, then its probably going to mean that stamp duty, if applicable, is the issue. If the property was on the market prior to the raise in Stamp Duty, the vendor may not even be aware that there is an issue.

yasmin2

A bit confused??? Does Stamp Duty kick in at £125,000 of £150,000 and is it the same in all areas?