Advice please! Seller interested in buying my house

willis

Hi,
Please will someone give me some advice?
I have seen a four bed semi-detached house I am interested in buying, and while talking to the vendor it came clear that we are selling the kind of house he is looking for (2 bed terraced) so has been to see it and is very interested.

I am not yet registered at a estate agent for selling my house, although the seller of the other house is.

Does anyone have any experience/advice for this please? If we both decide to continue, I am keen to suggest knocking £x amount off both houses, (eg: 20k) so although we sell for less, we buy for less -the difference is exactly the same, the only people who lose are the mortgage companies and estate agents.
Or is it better to suggest knocking x% off, as the houses are so different the prices are different and this may be a fairer way.
Or should we just stick to the asking prices? Or should we just swap houses and we pay them the extra?

Should I register with an agent to be the go between, and pay them a fee, or as I found the buyer myself, save myself the money - meaning I have to contact the other party myself, losing the anonymity if all goes wrong (although I have lost this already I guess)

It would certainly be an easy sale/buy if it goes ahead as there is no chain.

Please will you let me know what you think, or even if I should avoid this 'swap' with a bargepole.

Thank you

Jorgan_2

If you are both sure you want to buy each others houses there is no need for you to use an EA in your sale. Once you have agreed a sale price for both, instruct you solicitors & mortgage lenders. You will have more contact with your purchaser than in a normal sale but as long as you are happy to speak to them direct, you shouldn't have a problem.

Just make sure you keep all contact on a professional level, don't upset your buyer/vendor, if you fall out you may loose your buyer & possible property to purchase.

silvercar

We just did a similar thing. We bought my buyer's buyer's house in order to complete a chain.

Don't register with an EA, you don't need one as you have just found a buyer without one. There are big advantages in doing this; you know your buyer has as much incentive as you do in ensuring the sale goes through.

Your seller will have to pay their EA as they found the buyer for them. Agreeing the price could be tricky but once you've done that everything should be plain sailing (ish!)

You should really agree prices and then could consider knocking a small value off each. Consider if this has implications on percentage loan to value if one of you is looking for a high percentage mortgage. Anything more than a few thousand and the tax people will investigate whether you are trying to evade stamp duty.

Anything else I've forgotton just ask. For us it made everything more transparent. dealing direct was much easier and we managed to keep the whole chain informed and together. The only issue would be if someone found something odd in a survey and needed to negotiate onprice.

willis

Thanks for the advice.
My main concern is that we always thought the house we viewed was too expensive for us, so were planning on only getting it if we could get a low offer accepted. However, we do need the asking price (or as close as we can get) on our own house in order to be able to move up the property ladder. If it was via an E.A,I would have no problem putting in an offer of 15k below the asking price, but how can I do that in front of the sellers and then say I will only drop 5k from our asking price?

silvercar

willis wrote:

Thanks for the advice.
My main concern is that we always thought the house we viewed was too expensive for us, so were planning on only getting it if we could get a low offer accepted. However, we do need the asking price (or as close as we can get) on our own house in order to be able to move up the property ladder. If it was via an E.A,I would have no problem putting in an offer of 15k below the asking price, but how can I do that in front of the sellers and then say I will only drop 5k from our asking price?

Remember that you will now be saving on estate agency fees. The only thing you can do is be honest and tell them exactly what you've just written. From their point of view they get a buyer with no chain, a quick sale and no hassle. They could decide it is worth their while.

suffolkb

How close are you to the stamp duty thresholds?For example,if one of you drops below £250k,thats worth quite a bit.You would have to be careful here.If you sold yours to them for 20,000 and bought theirs for 40,000,then I suspect the IR would come sniffing around.

Noozan

My brother did something similar to this last year, they had a 3 bed semi detached bungalow which was the size of a shoebox (!) - the second and third bedrooms were tiny. They live in a very small village and there was an older couple wanting to downsize but wanted to stay within the village. They did a "house swap" and paid the couple 10k on top - this was for a 4 bed detached house with garage and conservatory. This was in south Cornwall so they got an absolute bargain of a swap.

They had a survey done for peace of mind as they were worried about old mine shafts. Instructed mortage company and solicitors and it went thorugh quickly.

The only downside was that the gentleman that they swapped with was at their house all the time and one day, they came downstairs 9after the swap) to find him in the kitchen. He had let himself in to see if there was any post for him. :eek: They got the locks changed that afternoon!

willis

Noozan wrote:

My brother did something similar to this last year, they had a 3 bed semi detached bungalow which was the size of a shoebox (!) - the second and third bedrooms were tiny. They live in a very small village and there was an older couple wanting to downsize but wanted to stay within the village. They did a "house swap" and paid the couple 10k on top - this was for a 4 bed detached house with garage and conservatory. This was in south Cornwall so they got an absolute bargain of a swap.

Hi,
Thanks for that- when they swapped houses, did they just pay 10k and the other couple paid them nothing at all, or did they both a reasonable price for a house, eg 150k plus your brother paid an additional 10k (160 total)

I thought of us just paying them the extra, and not exchanging any other money, but isn't that putting yourself in a risky situation in terms of stamp duty (ie: tax avoidance)?

In reply to Suffolkb, we're not near the 250k stamp duty bracket,but thanks for the advice. So we shouldn't both drop a significant amount off each house price to save fees/taxes? I thought it seemed to good to be true!

lilyann1

This happened to us we viewed a property and the vendors said they were very interested in a house like ours.We were already registered with an EA though.The vendors put note through a door to do a swap!! We had already dropped them £18k on their asking price and really needed our full asking price to enable us to do it.Our asking price was £280k and as it transpires their maximum was only£250k,so it couldn't be done.Thats' why we are stuck in the middle of a chain of 6 which has fallen apart twice and we are still going.
Just couldn't afford the drop of £30k though.
Good luck I hope it works out for you.
The only thing I was told when i considered coming off the market and selling privately was that the place we had seen if they did in fact buy ours we may have had to have paid their EA a fee as it was their introduction effectively??? If you can get it done without the EA's knowing then brill!!

Noozan

willis wrote:

Hi,
Thanks for that- when they swapped houses, did they just pay 10k and the other couple paid them nothing at all, or did they both a reasonable price for a house, eg 150k plus your brother paid an additional 10k (160 total)

AFAIK, they just extended their mortgage by 10k and paid it to their solicitor, who paid it the other party's solicitor, who paid the couple.

Gorgeous_George

Chek out the Stamp Duty liability with a solicitor.

At the back of my mind, ISTR that stamp duty is only payable on the difference between the two houses.



GG