Builder pulls out of sale...any advice please

sazeasy

Hi, any advice please would be welcome.

We had placed a £500 reservation fee on a 4 bed property with asking price of 185000. We agreed and signed to incentives from builder of carpets and stamp duty paid which are essential for us to proceed as we cannot raise this elsewhere. The mortgage was proceeding and final stage was valuation by halifax who have valued the property at £178000. I was contacted by the builder asking me how the valuation had gone, and I soon realised they had more or less expected the downvaluation as they have sold the others at £175 and one at £183 (despite a valuation on that one too of £178). I spoke to the valuer and respected his decision...he is the expert!

I went back to the builder and explained the situation and initially they would not come below £183. 4 days later they have decided to come down to £178 but withdraw the stamp duty and carpets. I explained that our financial situation (whch they had already assessed and knew about). They remain of the opinion that banks are unwilling to lend and as such are downvaluing...I calmly explained that this is the current market...i too have reduced my house by £5000 in order to try and sell it and the effects are the same for everyone. I understand they are loosing out on money but given that all their properties have been as they see it "downvalued" I pointed out that the next person interested in that plot is not necessarily going to be able to proceed either based on the valuations and that we were not trying to negotiate the price as incentive...if it were valued at £185,000 we would have been happy to proceed at that.

They will not budge, they will only proceed by withdrawing incentives that they have signed up to offer. I have asked they refund the full reservation fee which they reluctantly agreed to and have asked them to consider refunding the £355 valuation fee. they spluttered and said this was not usual practice however I said I felt aggreived because it is clear they expected the property would not acheive £185,000 upon valuation and they knew the other identical properties had sold at £175 and the most recent valuation (2 months ago) had also raised £178,000.

Am I being unreasonable asking that they refund the valuation fee? I simply feel that we have been somewhat led down the garden path. We have chosen interiors through them, placed reservation fee down, avoided mortgage company they asked us to avoid (as they said the Nationwide often downvalue!) and they have now made the sale impossible by withdrawing the incentives they signed up for which were our only chance to proceed.

shane42

i think you were lucky to get the £500 back , just walk away if they wont play ball, they need you more than you need them

sazeasy

Yes, you are probably right. Hugely dissapointing of course but I shall be dammed if I'm paying over the odds or going to be their guinea pig for raising the house prices on that particular developement.

Kyrae

Hmm so the mortgage company has valued the property at £178k, and the builders have offered to sell it to you for £178k, what's the problem?

Wickedkitten

Kyrae wrote: »

Hmm so the mortgage company has valued the property at £178k, and the builders have offered to sell it to you for £178k, what's the problem?

THey have taken away the incentives and aren't paying the stamp duty which the OP needs them to do because they can't afford it.

Thrugelmir

Wickedkitten wrote: »

THey have taken away the incentives and aren't paying the stamp duty which the OP needs them to do because they can't afford it.

Incentives cloud the real value of a property. When buying with any incentives or freebies always budget for a downward valuation for mortgage purposes.

jennifernil

So you could afford it at £185k if they paid stamp duty and carpets? Now they will sell for £178k? Will the carpets and stamp duty come to more than £7k?

If not, then I do not see what the problem is.