Lowering an offer

kilby_007

Hi,

We sold our house in November and we have been looking and offering on properties since then but we've had a long run of bad luck, finding various structural problems with the houses we had offers accepted on. Finally a week ago we found one that we liked but it was hugely overvalued at a guide price of £310K-£330K. We were a little bit desperate because the buyers of our property were getting itchy feet so we put in an offer of £280K, which in all honesty is more than we thought it was worth but there weren't many other options for us at the time. They rejected our offer and we decided instead to rent which would put us in a better position to buy without the pressure of selling ours at the same time. We found a place to rent and have set a date for completion on our current property for 3 weeks time (exchange in the next few days).

Just yesterday we got a call from the Estate Agent of the property we'd offered £280K on, asking if we were still interested so I said that we were but updated them on our current position and they said they were trying to "educate the minds" (their words not mine) of the vendors to come down to our level and to expect a call soon. They were obviously playing the waiting game with us expecting us to up our offer, but it's backfired on them because we're now going to be renting and I'm thinking with the £10K we'll have spent on our 12 month rental we would be justified in dropping our offer to £270K. The estate agent has said that they're really keen to offer on another property so the tables have turned somewhat in terms of who has "the upper hand" (I hate talking like that but that's what this property game has reduced me to!!). They called back today and left a message for me to call them, but I haven't yet.

It's not like we're gazundering because they haven't actually accepted our offer yet, but I think I would like to revise our offer as we're not too bothered if we lose the property. We quite like the idea of renovating a property ourselves so it's no great shakes if we lose out on this one. Anybody any thoughts on the best way to go about doing this?

marksoton

Then do it.

But you've already offered 50K below asking price. Pushing it to 60K may loose you the purchase.

But then you don't seem that bothered anyway.

kilby_007

Oops, duplicate

kilby_007

marksoton wrote: »

Then do it.

But you've already offered 50K below asking price. Pushing it to 60K may loose you the purchase.

The usual asking price for a house of that size/plot around there is £260K - £280K and they sell for average 94% of asking price. The only thing that stood out with this property is that it had been newly refurbished to a high standard, perhaps adding 5-10K in value but not 50K. I think it's the vendors getting carried away with themselves to be honest because the EA did agree that it was overpriced. What doesn't help is that I know they bought it at 180K 2 years ago and stand to make a good profit on it anyway, which is kind of what we want to do!

marksoton wrote: »

But then you don't seem that bothered anyway.

You're right. The only sense of urgency we have is that the interest rates might pick up and we can fix for 5 years at a very low rate at the moment. Other than that, there's lots of properties coming to market in the last few days and I'm wondering if something more suitable might come up soon anyway.

mrginge

kilby_007 wrote: »

You're right. The only sense of urgency we have is that the interest rates might pick up and we can fix for 5 years at a very low rate at the moment. Other than that, there's lots of properties coming to market in the last few days and I'm wondering if something more suitable might come up soon anyway.

On the other hand, if interest rates pick up then that will stifle house price inflation, plus you'll get increased interest on your savings.

Debtslayer

Have you signed any paperwork for the rental property? If you have you will be liable for the min term you have signed for; 6 months or 12 months
It doesn't sound like you are particularly keen on the house you offered on anyway

kilby_007

Debtslayer wrote: »

Have you signed any paperwork for the rental property? If you have you will be liable for the min term you have signed for; 6 months or 12 months
It doesn't sound like you are particularly keen on the house you offered on anyway

We haven't yet, but we will be doing anyway because we can't delay the sale of our property any longer. I know that we will be liable for the minimum term (I think it will be 12 months, just waiting for the tenancy agreement to come through the post) and that was my justification for dropping our offer on the property we've offered on.

We do like the house, it's really nice in terms of how well it's been renovated but it's not unmissable. With the two properties we'd offered on previously we thought they were "the one" but we don't quite get the same feeling about this one. It would need about 30-40K spending on an extension to bring it to the same kind of size/layout as ones we'd previously offered on at about the same price.

Debtslayer

kilby_007 wrote: »

We haven't yet, but we will be doing anyway because we can't delay the sale of our property any longer. I know that we will be liable for the minimum term (I think it will be 12 months, just waiting for the tenancy agreement to come through the post) and that was my justification for dropping our offer on the property we've offered on.

We do like the house, it's really nice in terms of how well it's been renovated but it's not unmissable. With the two properties we'd offered on previously we thought they were "the one" but we don't quite get the same feeling about this one. It would need about 30-40K spending on an extension to bring it to the same kind of size/layout as ones we'd previously offered on at about the same price.

In that case then I would sit back for a while in the rental property and not rush into buying something that you are already saying would need 30-40k spending on it. There will be plenty of properties come along in the next 12 months and you'll find the one. Then you will be in a perfect position to purchase with no home to sell

TrixA

I don't think you should worry that this is immoral in some way, your original offer was rejected and you're quite within your rights to submit a lower offer. That said, the best time to do this would have been the first conversation with the estate agent when they got back in touch with you. If they now have a conversation with the vendor and manage to talk them around to your original offer, and then you come back with a lower one, the perception will be that you're messing them around. Also, psychologically it's going to be more difficult to accept a reduced offer from a buyer who's previously offered more, than the same offer from a completely new buyer.

So by all means reduce your offer if that's what you want to do, but I would be surprised if it's accepted.

evansc1

Sounds like you are trying to convince yourself that you actually want this property...


If you're really not that bothered and are going to be tied in to the rental for a year, go 15k down so that you cover those potential extension charges a bit further.
If they really are that desperate, you may get them come back with something interesting..

kilby_007

A little update. We moved into rented last month and the property was removed from the market, only to reappear with a different estate agent at a lower price. We've had the old estate agents ring us twice, practically begging us to go for it which is weird. Anyway, I went with my instinct and backed away, and the house is still there (I'm expecting another reduction soon) but in the meantime we've found a better property (larger, bigger garden, more character, closer to shops) in a different village (less expensive one might I add) and offered 280K, feeling more confident that the property is actually worth that, and will retain it's value. Bit of a learning excersise I think, that when something seems too expensive, it probably is!