Advice on next move for house purchase

Catatonia

I have found a house I like, but it seems a bit overpriced. Came on the market towards the end of September for £310k. It was reduced to £295 a month later. It's a bit hard to value as on the street, there are only three other houses that are identical and none of the four have sold since 1995.

However, it's basically a three bed semi which has been extended to the back and side on both storeys to make a 4 bed. Three bed semis of a similar age are on for £230-245k, including those with single storey extensions to the back. It just seems that it's a lot extra for not a great deal of extra space.

So I put in an offer of £250k to test the water. The EA came back without a counter-offer, and said that they had laughed. The EA reckoned that it's very rare for houses to go for more than 5% below asking (not true according to latest surveys) so that's where we should aim for. Oh, and EA said that it is very well priced as 5 EAs agreed on asking price (although clearly they weren't that accurate as it's already been reduced).

Any advice? Is it normal for an extra bedroom and some extra living space downstairs to increase the value by this much? Any suggestions about what to offer next?

ETA: See last page - I have had offers of £250k, £260k and £266k all refused, but the seller has now gone multi-agency. This seems to suggest they're pretty keen to sell so I can't understand why they won't accept an offer from a proceedable, chain-free buyer at over 90% of an overpriced asking!

hazyjo

What position are you in? Somewhere to sell?

A house is only worth what someone's willing to pay for it. The house we've had an offer accepted on is now £65k under what it was originally up for 10 months ago!

You've expressed your interest... if you want it and it's not been on the market very long, you might have to tap your fingers until next year when they realise it won't go for more than £250k. Some roads/houses are more desirable and can command a premium. You'll find out how desirable if it sells at the price it's up for. If not, and you definitely want it, sit tight and let the agents know you're interested.

If you're in a chain, that changes things and you might have to find something else if they won't drop...

Jx

Catatonia

We've already completed on our house sale and are currently renting so I guess we should wait it out a bit.

Richard_Webster

What are the cheapest 4 bed detached going for in the area? It is unlikely a seller could get more than a detached price for a semi in the same area so that will be a ceiling and then it is a question for how much you take off form that base price because it is a semi and not detached.

tyllwyd

Have you estimated the cost of building that extra space? A rule of thumb is £1000 per square metre. Does that bring the price in line with other properties? A two storey extension isn't cheap.

Richard_Webster

Have you estimated the cost of building that extra space? A rule of thumb is £1000 per square metre. Does that bring the price in line with other properties? A two storey extension isn't cheap.

Just because it costs a lot to build an extension doesn't necessarily add the same amount to sale value - but a lot of sellers think it does.

Catatonia

There was one 4 bed detached on for £250k which is now SSTC after three months. There are a few at the £270/280 mark.

I will try and calculate the rough price of the extension.

tyllwyd

Richard_Webster wrote: »

Just because it costs a lot to build an extension doesn't necessarily add the same amount to sale value - but a lot of sellers think it does.

Yes, I realise that - but equally, if an unextended 3 bed might be on the market at £245, an offer of £250 certainly wouldn't reflect the extra cost of the extension. And even at £295 it might be being sold at less than it would cost to buy the house & build the extension. So it is worth bearing in mind if the OP would be looking to extend the house in a similar way if she bought a 3 bed instead.

To be honest, we're in a similar situation - we built a two-story extension to extend a 3 bed house to 4 beds. We are looking to downsize, but we can't bring ourselves to move to a 3 bed if the new house plus the cost of a similar extension would add up to more than we could get from the sale of our current house - we'd rather stay where we are, and get the benefit of the effort we put in to get this house how it is.

neverdespairgirl

tyllwyd wrote: »

Have you estimated the cost of building that extra space? A rule of thumb is £1000 per square metre. Does that bring the price in line with other properties? A two storey extension isn't cheap.

I don't think the cost is that relevant, to be honest.

Say there is House A which is a 3 bed semi. Worth £100k.

House B down the road is a 4 bed detached, worth £120k.

House A spends £50k on a gold-plated extension which means it has the same number of beds and sq. footage as House B.

Would you pay £150k for House A, or £120k for House B?

tyllwyd

neverdespairgirl wrote: »

I don't think the cost is that relevant, to be honest.

Say there is House A which is a 3 bed semi. Worth £100k.

House B down the road is a 4 bed detached, worth £120k.

House A spends £50k on a gold-plated extension which means it has the same number of beds and sq. footage as House B.

Would you pay £150k for House A, or £120k for House B?

I see what you are saying. But the OP was asking the question how much value did the extension add to the 3 bed house - if the choice was £100K for a 3 bed semi, or £150K for the extended 4 bed semi, if you wanted the space you might decide on the extended house because all the hassle of the extension had been done for you. And if the vendor had paid out £50K for the extension, OK it might not add that much in value to the house, but it would have a bearing on how much they were willing to accept as their minimum price to sell the house.


And edited to say ... and what if the cheapest 4 bed detached in the area was £160K? The extended one at £150 might not look bad value then.

puddleduck

The market where we're looking at is all over the place atm. However, there are two properties that I've looked at recently. They are on the same road (actually next door to each other). One is 3 bed, the other extended like you describe to give extra space downstairs (and a cloakroom) and a 4th bedroom upstairs. The 3 bed one is on for £225, the 4 bed for £250.
hth