How to play this one?

DaftyDuck

I, too, think you misread the initial expected price. Anything around the £535 or lower level, I'd expect to start well under the £500k, and end up just under there for stamp duty reasons. I'd need a VERY strong argument from the EA that the property was actually worth £525... I'd be extremely hard to convince.

Your problem is convincing the owner to drop the price, now you have shown you reckon their house is worth £525, and that you can afford £525. The only thing to do is try it, and be ready to exchange pdq to avoid them finding another [STRIKE]mug [/STRIKE]buyer willing to pay over their expected price.

pinkteapot

Moneycat wrote: »

We really like the house and don't mind paying a premium but £25k is somewhat hard to swallow.

It's actually £31k when you include the extra £6k in stamp duty that you'll be paying.

The bank's valuer will know that it's very hard to sell anything for just above £500k, because of the stamp duty issue. Therefore, he thinks that if you had to resell the day after completion, you'd only get £500k. The bank look at it from the perspective of what they could recoup.

If you were borrowing at the limit of the %LTV that they'd lend to you then you'll need to renegotiate, or you won't be able to afford the house.

If you weren't, it's up to you whether you pay the £31k more or not. Personally I'd try to negotiate. You may not get them down to £500k but you might get them down a bit.

In our chain, our vendor's survey on the house they were buying downvalued it and they renegotiated the price. The person they were buying from wanted a quick sale though. Whether your vendor is open to negotiation will depend on how keen they are to move, and what they think they might get in offers from other people.

thequant

DaftyDuck wrote: »

I, too, think you misread the initial expected price. Anything around the £535 or lower level, I'd expect to start well under the £500k, and end up just under there for stamp duty reasons. I'd need a VERY strong argument from the EA that the property was actually worth £525... I'd be extremely hard to convince.

When I was previously shopping at the £250K level, everythingI offered on was between £250k-£265k


My typical opening offer would be £240k


without fail, the counter offer from vendor would read something along the lines of


EA, "As a FTB they know you willstruggle to find the extra money for the stamp duty above, so will come down to £250k but not a penny more"


Me, "no not interested then"


EA, "you not even going to counter offer them ?"


Me, "I'll only counter offer when they have made a genuine counter offer, they asked for £265K which means their asking price is £250k, so a counteroffer of £250k is not a reduction"


The counter offer would usually then come in at around 248/249


Did it on about 5 properties, never failed with further reductions along after more negotiation