What offer should we make?

Jenna2185

We've seen a lovely house that is in need of modernisation (knock through to make kitchen-diner, new bathroom, new carpets, decoration etc + possible re-wire). The house is up for £140,000 and similar houses in the street are selling for around £155,000 (I'm guessing with no work to be done but can't be sure).

According to the estate agent the house is owned by a company who have been renting it out as a long term let and the tenant has recently passed away so they are now looking to sell the house.

It's been on the market since the beginning of April and has already received offers. 1st from an investor - offer was accepted however the investor had second thoughts about the amount of work to be done & lowered the offer which was subsequently rejected. 2nd was from a couple - their offer was accepted but they were unable to secure a mortgage so the sale went no further. Then there's us - we are renting our house out at the moment and have moved back in with the in-laws to save and improve our negotiating position (no chain). We have a mortgage in principal and deposit etc and this will be a family home for us - we wouldn't be able to afford to get all the work done straight away.

What sort of offer should we make? I understand it's difficult to advise when you don't know the area etc but it would be helpful to know where to start off. We want to get a good deal but also know we need to be sensible and realistic. Any advice appreciated.

Thanks

marathonic

Difficult to say what to offer but if it's on the market at £140,000 since April, it will probably end up going for £125,000 or below (due to the Stamp Duty threshold, it's unlikely to for for, for example, £130,000).

girl_withno_name

My understanding was that carpets and decoration are not usually considered to be negotiation tools - I gather that they're more often considered to be "personal choice" elements of a house that any buyer might want to change in any house. I'd actually argue the same for the kitchen-diner (for example, you might want to do this work, whereas I'd want to undo your work!)

A new bathroom might be a few thousand and a rewire again a few thousand... so overall the asking price of £140k doesn't seem too ridiculous to me.

While it has been on the market since April, it sounds like it's had enough interest to generate two offers at acceptable levels - do you know how much these were for?

Jenna2185

Unfortunately the kitchen is far too small to keep as it is, there is currently only a few units, small sink and a freestanding oven and with two small children it just wouldn't be practical for us as a family.

I asked the estate agent if he could indicate what the offers were but all he could tell me was that 'they weren't the asking price' which is not particularly helpful.

Personally I don't think the asking price is too unrealistic - I would probably be happy to pay around the £135,000 mark but I'm cautious about going in all guns blazing just because I have fallen for the house. Would it be advisable to start at £125 and work our way up or would that be wasting the vendors/estate agents time?

We bought our last house in March 2007 just before the big crash and have ended up loosing money on it so I am perhaps being overcautious?

Skinto_7

Jenna2185 wrote: »

Unfortunately the kitchen is far too small to keep as it is, there is currently only a few units, small sink and a freestanding oven and with two small children it just wouldn't be practical for us as a family.

I asked the estate agent if he could indicate what the offers were but all he could tell me was that 'they weren't the asking price' which is not particularly helpful.

Personally I don't think the asking price is too unrealistic - I would probably be happy to pay around the £135,000 mark but I'm cautious about going in all guns blazing just because I have fallen for the house. Would it be advisable to start at £125 and work our way up or would that be wasting the vendors/estate agents time?

We bought our last house in March 2007 just before the big crash and have ended up loosing money on it so I am perhaps being overcautious?

Id definetly go in at £120-125k, all they can say is no, and that doesnt take long to say so you wont be wasting too much of their time. You might get lucky and they might accept or worse case they say no and you make another offer

jozbo

Try 120-125,000 and spell out your excellent position to the estate agent.
If rejected I'd tot up all you'd want to spend on it to bring it up to your standard, and calculate how much you'd need (worse cast scenario) to do the essential (non-cosmetic work). Rewire, new boiler / CH, fixing existing issues could well exceed £15k. I'd aim for a second, final offer of £130k.
With properties needing work I feel it's a good negotiating tool to show you've looked into all costs you'll incur (called builders for estimates etc) and give a carefully thought about final offer eg £131,700.

Clearlier

Find out what similar houses in the street have actually sold for. Asking prices aren't really much use as a guide.

girl_withno_name

Clearlier wrote: »

Find out what similar houses in the street have actually sold for. Asking prices aren't really much use as a guide.

The first post does say...

Jenna2185 wrote: »

We've seen a lovely house that is in need of modernisation (knock through to make kitchen-diner, new bathroom, new carpets, decoration etc + possible re-wire). The house is up for £140,000 and similar houses in the street are selling for around £155,000 (I'm guessing with no work to be done but can't be sure).
...

So it could be that the OP is already looking at actual sold prices in the area.

Jenna2185

Thank you all for your replies however there has been a further development today.

I was showing some of the girls in work the house on RightMove and discovered that it has now been reduced down to £130,000.

OH has also noticed a crack on the exterior of the property running from an upstairs bedroom to the top of the storm porch. It has been filled in and repainted etc but it looks fairly big. OH contacted the estate agents today and they were very cagy about giving any information but told him someone (i'm guessing the first person that made an offer) has had a survey on the property and then not proceeded - OH asked whether it was anything to do with subsidence and Estate agent said she 'thinks so but it wasn't serious'.

Now we're both very torn, we still like the house but are worried it could end up being more trouble than it's worth. Can we/should we take a surveyor to the next viewing with us?

robatwork

I would take a builder (who won't charge) or surveyor (who will charge) with you and view again.

Also view the "other houses in the street that are selling for £155k" to see how much work they need so you can compare

MrRemus

there's lots of posts on subsidence so have a look - it can be quite scary but you need to get a structural engineer in to assess things. good luck