To sell or not to sell now please help us experts

des123

dear anyone please advise us

can you please advise on what to do as me and my partner are at ends wit of what to do next. I know you cant decide on us and its only we who can make this decision , but any honest opinion from you all will truelly help us with this mortgage issue. We would be also utterly thankful.

We got a two bedroom house . We put the house on market in 2008 summer . House got valued at £155,000 by agents . We used three and got the average . We never proceeded to go ahead as the credit crunch hit. Never advertised our house nor never put it on the market.

Now we got a little baby and we our struggling to live at our house due to space . We have lived here since 2004 and need a bigger house as room is running out with two dogs on top.

Our fixed mortgage came to end last year and we fell into the standard variable rate . We are contining payments as the interest base rate is low and we have no ties.

Now again we dicided to sell. We got two estate agents again and re - valued the house . We were shocked that it got valued at £129,000. Thats nearly 25 thousand less than 2008. We understand house prices have hit rock bottom but this leaves us very less deposit/ equity for our next house . As we are looking for something around 190,000 in a good catchment so that our child could have a good start in school.

We went to our existing bank and got some quotes . The mortgage adviser thier said we could get home mover mortgage of LTV 75% but they would need a deposit of at least 35,000. Now if we sell this at say £125,000 our equity since we bought it would be only 3,000. My savings for fees and any deposit is only 15,000. Leaving a total of 18,000 short as a deposit. So this is no where near the 35,000 deposit mark the lenders want. we can get 90% LTV but monthy payments are far too high.

now my main question is do we sell at all? estate agents are very pushy to get it low as possible and get a quick sale . But we cannot bare to see this go this low price when we spent about £20,000 doing the house up last 5 years . If we sell is it worth trynig to get a ltv of 90%. If 90% ltv we will i think struggle to pay a monthly payments. If we go for a lower price house we are losing the areas we want to live in. As we want a good catchement school for our daughter.

Do we sell or do we just agree to sit back another year and see what the market is saying. At least then i think we will have more to save and the equity of the house might be more too.

Can anyone please be kind enough to give us some advise on what to do at this current stage .

VIGILANT22

If EA's are applying a commission % to the sale, they're more likely to upsell........sit it out if you can and save or reduce the mortgage as much as you can/whatever makes the best financial sense/try having a declutter/space saving exercise in the meantime....and good luck

des123

this is the thing estate agents are all commision based so dont know if they are undervaluing the property to get quick money in there pocket. also just checked nearby aereas house prices are nearly 10,000 more than ours thats 1/3 distance from ours . these houses are the same spec. the declutter job is already done . the purpose of moving is for our child really.

Cannon_Fodder

£155k to £129k, is around -17%.

Assuming there are no local reasons for a major skew in prices, that implies that a year earlier the £190k house you are aiming for now, would have been £229K-ish.

i.e. you would have needed a £74k increase in mortgage, to fill the gap from £155k to £229k.

Now, your place might have lost £26k, but the house you want may well have lost £39k, roughly.

i.e. only a £61k top-up mortgage is needed if you sell at £129k and buy at £190k.

So, overall you'll be aiming at a £13k lower mortgage, comparing then with now.

And the associated interest over the remaining years of the term will forever be calculated on that lower amount.

It is unfortunate that Lenders have tightened their criteria/products/LTVs at this time, but if you can find a bit more cash now, perhaps to get a 85% deal that is a compromise between the deals you have seen so far, then maybe it would be doable to move now.

If waiting for your equity to increase means relying on house prices' market-led recovery, then the house you want in the right school catchment will also have increased in price - while improving your LTV, allowing you to qualify for the size of mortgage, the monthly mortgage amount will be increased.

If waiting for your equity to increase is based on sensible saving, and over-paying the mortgage by taking advantage of current low rates, then its possible you might move ahead of market conditions.

Depends how confident you are about rebuilding your equity through your own efforts, rather than hoping the market does it for you...

iamana1ias

Could you extend your house instead of moving?

Radiantsoul

It does sound like you need to build up your savings more.
The plus side is your SVR is probably pretty cheap.

des123

thanks for the replies . the only problem with the 85% LTV value would be that paying more monthy. another thing is the level of low number of houses on the market at the moment. we will obviosly have less choice in selection. we are tring to save only at the moment and have not thought about using the SVR to pay the mortgae so that equity would be lower. we have to either save or either pay the equity as financialy it is not viable for us to do both.

we have seen a house around 170,000 now and is now thinking of seeing if we can sell this at about 135.000 and put an offer into that. but if its not the one we were thinking to stay put . we are getting more and more confused of what to do. your answers are much apprciated. i can see what you are on about Cannon. thanks for the figures.

im not the best when it comes to number crunches around the mortgage side .

declutter has been done by many visits to the tip. also cant extend as already got a small extention.

so what next is the question ? just wondering what would happen if the agents valued this at 129.000 and we put it for 137000 . Are we risking a non sale as the survey searches will pick it up saying over priced . we will have to gamble and prey that there is a couple of people out there with funds in there banks.

i wish i won the lottery a couple of thousand would do.

Dan_1976

Estate agents are a guide and you can put your house up for sale at whatever price you see fit.

A good EA will tell you if your being silly and will even refuse your business. Then again they will also take it and then tell you to lower it if it does not sell, wasting your time.

You will have to try and judge who is the most honest and professional out of the lot of them. get 3-4 around, you will see the difference and go with your gut feeling if your not 100%.

Some agents now charge a fixed fee and some still work on a % basis. Some will take it on and try to lower the price to get a quick sale some wont. I think you will need a pro active EA if your going in at the high end.

A very high % of sales are via Rightmove so marketing by the agent will be key if your selling at the higher end.

You can always try it and see, then lower it slowly.

Good luck

des123

Thanks for your vopinion . the problem is i have not had an honest person around yet . we are going to give it a go and see . The estate agent we were thinking of is requesting 1.5 % which i think is a bit high . need to check a few others . i think im going to put it the price we want and see how it goes . worth the gamble .

loopy-juice

des123 wrote: »

Thanks for your vopinion . the problem is i have not had an honest person around yet . we are going to give it a go and see . The estate agent we were thinking of is requesting 1.5 % which i think is a bit high . need to check a few others . i think im going to put it the price we want and see how it goes . worth the gamble .

Honest? If that is your interpretation of someone giving you the market value of your home and you not agreeing is a little unfair on the EA tbf. As a poster suggested, you can put your house up for whatever you think it is worth and try and sell it. The market will find its value for it. When you were quoted £155,000 in 2008 was that an honest valuation?

ps: if you think you are going to struggle to meet a higher mortgage then its a no brainer imo.

pps: You've got a two bedroomed extended house with a baby. Where is the space issue?

Dan_1976

You have to remember, they may well be honest, but they are still in the game to make money. They will want to sell your house, and they will want to get the best price but it may not be the price you want.

Thats why you should remember they are not guru's, they are there to suggest and give a guide price.