First time buyer and making an offer on a flat

Yasmin02

Hello

I need some advice on offering on a flat. They are two in the same block one on the market for £187 and the another flat for £179k. Both are the same size although one is a reposession. I was thinking of starting at 165k as I have a very large deposit to put down and I am a first time buyer.

Does anyone else have any suggestions? Does anyone know what happens with leasehold flats fall below the 60 year threashold?

Thanks in advance
Yasmin

Doozergirl

Yasmin02 wrote:

Does anyone know what happens with leasehold flats fall below the 60 year threashold?

They are very expensive to renew! Is it one or both flats that have a short lease?

Yasmin02

Hello

Non at the moment I am thinking more of a longer term basis in terms of selling the flat on in the future. At the moment there is 122 years left on the lease. Do you have a rough idea of how much they are to renew? When the lease expires does it go back to the freedholder of the flats?

Kind Regards

Yasmin

Doozergirl

LOL! Don't let it run down that far! You'd renew the lease before it gets to 80 years to get best value, or if you are staying for 60 years(?), then at some point you can try to persuade the other flat owners to buy the freehold with you.

£165k sounds like a nice place to start. Make sure you've done you homework and seen what else is available at that price and know when to stop

Yasmin02

Hello
Well i have made both offers and with no surprise both of the offers were rejected. Is it normal practice to then go up by a couple of grand and up my offer or should I wait for the estate agent to come back to me? The EA was saying that one is reposession and will remain on the market until contracts are exchanged is this correct?

The EA was also saying that i need to have a mortgage in principal agreed. Is this the case? Not to sure really as I thought that there was no garantee even if I had a MIP paper. Also, does anyone know if there is much movement in the market on flats in the romford.chadwell heath area in greater london.

Thank you very much and sorry for so many questions.

Ysamin

Doozergirl

You need to make subsequent offers as the EA may or may not come back to you. If you get another offer rejected, it would be fair to ask how much the vendor would be prepared to accept (this is on the one that is owner occupied; the repo they won't tell you) as it gives you more to negotiate on.

Yes a repossession stays on the market until exchange of contracts, so you need to move quickly, they normally ask for 28 days to exchange.

Yes you need a MIP from your lender specifically for the repossession property for them to accept your offer but this is what you should be doing anyway, tbh. Puts you in better standing with everyone.

No idea what the situation is like your your part of town; the areas of London I do know (a small bit of SE/SW), it's very easy to get asking price, still into this year.

hoyin

Yasmin02 wrote:

I was thinking of starting at 165k as I have a very large deposit to put down and I am a first time buyer.

I don't understand what the offer has to do with having a large deposit?

Yasmin02

hoyin wrote:

I don't understand what the offer has to do with having a large deposit?

My thinking is (and this could be wrong) if I have a large deposit then surely I am in a better position than other first time buyers?

Yasmin

hoyin

Yasmin02 wrote:

My thinking is (and this could be wrong) if I have a large deposit then surely I am in a better position than other first time buyers?

Yasmin

I don't quite understand why you would be? It might help you get a bigger mortgage, but I don't think it helps the seller - regardless of how large your deposit is the seller will still get the same amount of money in the same amount of time from the mortgage company and your own deposit.

Having a larger deposit would not affect the seller at all.

Being a first time buyer would though - as it means you are not in a chain and are therefore able to move quicker.

Yasmin02

THank you very much for your comments it all makes sense now!

EA has just rang me regarding one of the properties i put an offer in for and his exact words were

'we have a number of offers on the table do you want to up yours'

I do not trust EA I was wondering if this is a normal trick that EA's use to try and make you up your offer of to make you think the flat is in demand.

Any views welcome. Thanks in advance.

Yasmin

TTMCMschine

Yasmin,
my advice is to think long & hard before buying a flat. There is an absolute glut of them, & at £150K plus you're almost certainly going to see it depreciate - have a look here:

http://forum.globalhousepricecrash.com/index.php?showtopic=14992