Think House is V overpriced - what do we do?

Monkey1977 · 19 March 2007 at 2:30PM

Hello,

First post so please be gentle! We are FTB with a good deposit and are looking for a 3 bed semi with 3 good sized bedrooms in North Bucks/South Northants.

Having viewed about 20 places we saw one last week that has the spec we want but needs decorating, new carpets, new bathrooms (x 2) and new kitchen. It also has a sitting tenant who is not keeping it clean or tidy (to be polite - the place is a pig-sty)

The vendor bought it for £185k 18 months ago and it is on the market for £225k. I've seen immaculate new builds for that price and reckon it would cost £20k to get it up to scratch. I really think its over-priced. According to Hometrack semi's in this area have been fairly static over the past 2 years. Even allowing for a 9% increase, it would be worth no more than £203k. No work has been done on the property recently and the tenants have obviously ruined carpets/walls etc...

We're interested in the house but have seen others that are 'move straight in' quality for the same or less. How do we go about making an offer when it seems that the property is so over-priced?

Thanks in advance

imoneyop · 19 March 2007 at 2:39PM

A house is only worth what someone is prepared to pay for it! If no one is going to pay 225k then eventually the seller will have to reduce the price.

Workout what you are willing to pay for it after factoring in all of the costs of refurbishing it and make an offer based on that price. You've got a lot of ammo for why you are making a low offer.

If they refuse the offer then walk away - don't let them bully you into paying over the odds for it.

Monkey1977 · 19 March 2007 at 2:45PM

Thanks imoneyop.

That is the father-in-law's advice too - he thinks our offer should be £190k. I don't think I'd pay more than £205 for it, given the work there is to do. With that in mind, is £190k too cheeky? (I happen to think the asking price is Damn cheeky btw!)

scope · 19 March 2007 at 2:51PM

Monkey1977 wrote: »

With that in mind, is £190k too cheeky? (I happen to think the asking price is Damn cheeky btw!)

I wouldnt worry about it.. The worst thing that can happen is that they say No. Go for it if this is the house you want.

olly300 · 19 March 2007 at 2:52PM

Depends how much you really want the house. You can't force the vendors to take a realistic offer but the EA will try to if no one else makes reasonable offers.

Make an offer for near the maximum price you will pay. The EA may give you a clue on the price the vendor will accept. If that is near your maximum offer offer that price (this happened to me and someone else I know in the past year) otherwise offer your maximum price and be prepared to walk away.

Either:
1. you don't get the house and it's taken off the market because no one will offer what the vendor wants. (This happened to a good friend of mine.)
2. your offer will be accepted (This has just happened to someone else I know)
3. your offer will be rejected then something happens like someone else makes an offer that meets the price then pulls out, you are contacted again to see if you will up your offer, you refuse and your offer is accepted can happen. (This happened to the friend in point one.)

In the meantime keep viewing properties.

benood · 19 March 2007 at 2:55PM

I'd go for £190 - psychologically the vendor won't want to lose money on the place and with stamp duty, legals, and a bit of renovation it probably cost him around that. If he needs to sell he might take the offer.

Monkey1977 · 19 March 2007 at 3:07PM

Thanks guys, you've reassured me. I'm keen to be taken seriously and this will be the first offer we put in, but I'm not about to pay over the odds.

Will offer this week and let fate decide. There's another property I'll offer on if this one doesn't work out

gothgirl123 · 19 March 2007 at 3:15PM

We viewed a house we liked, but again, it needed decorating throughout, needed double glazing and was on for £125,000.

We decided we would put a cheeky offer in of £117,000 in respect of the amount of work that needed doing and got told we could have a deal at £118,000 which we did!

The sale actually fell through in the end, but it does show that a deal can be done!

Sisyphus · 19 March 2007 at 3:51PM

gothgirl123 wrote: »

We viewed a house we liked, but again, it needed decorating throughout, needed double glazing and was on for £125,000.

We decided we would put a cheeky offer in of £117,000 in respect of the amount of work that needed doing and got told we could have a deal at £118,000 which we did!

The sale actually fell through in the end, but it does show that a deal can be done!

So in reality their £125k asking price was cheeky not your £117k offer. We've been conditioned to believe that an offer lower than an asking price is 'cheeky'.

Monkey1977 · 19 March 2007 at 3:54PM

gothgirl123 wrote: »

We viewed a house we liked, but again, it needed decorating throughout, needed double glazing and was on for £125,000.

We decided we would put a cheeky offer in of £117,000 in respect of the amount of work that needed doing and got told we could have a deal at £118,000 which we did!

The sale actually fell through in the end, but it does show that a deal can be done!

This I would have absolutely no qualms about. Selling prices in our area are currently about 95% of asking prices so i wouldn't see a £117k offer on a £125k property as cheeky - just a start for negotiating. BUT... I'm looking at putting in an offer that is £35k below asking price! Thats why I'm nervous!