Should I overpay or withdraw from sale?

Mahsroh

As stated in a previous comment.... I personally think it really depends how long you plan to stay there.

If it's a house for life and you really have fell in love with the property then don't let the valuation worry you too much. If, however, it's a stepping stone for something else in 5 years or so, then I would pull out if you cant agree a lower price.

I bought a property back in 2008 (I originally lived in it but now rent it out). I paid £110,000 I felt I was getting a good deal on the basis that the seller had bought it 18 months earlier for £108k and spend £10k on significant improvements (converted store cupboard into downstairs toilet and done fundamental work to correct damp issues etc). When the survey came back it stated a valuation of £100k but I proceeded anyway. Needless to say - this was 2008 so house prices only went one way for next couple of years later and as I type this in 2016, the house is still not worth the £110k I paid for it nearly 8 years ago! Thankfully i'm starting to build a bit of equity now thanks to overpayments and I plan to sell the house in 2-3 years time to fund the purchase of a family home, but paying £110k is the single biggest financial regret of my live.

jbainbridge

Hmmm ... you should have checked the sold prices before offering.

On the strength of the survey valuation I would try and negotiate a price near or at 120. Pulling out is also an option - up to you!

kate5555

OK seems like general consensus is definitely don't pay more than £120k - maybe £120k is even too high in comparison with sold prices? I would post the sold price links for info but I'm not allowed to post links as a newbie.

I fell in love with the house first, then thought about what I would be happy to pay, rather than thinking critically about what the house might be worth. I did look at the sold prices before offering but naively thought it wouldn't be a big deal, thinking a house is worth what someone is willing to pay for it (not considering someone else in the future might not feel the same way as me :embarasse). I don't really know how long I plan to live there but it definitely won't be my forever home.


Thanks everyone for your opinions and advice. Still waiting for seller to respond to my offer of 120 but I will update when I hear back.

Mahsroh - thanks for sharing your experience - sobering but definitely useful!

G_M - many thanks for very useful comments on the survey.

questionss

I would definitely get the drain issue looked into before purchase. I have paid a couple of thousand over a survey valuation in the past but less than 1% of value.

skimper

When I started reading your OP it sounds exactly like my situation.

We agreed on £130k (it was up for £135k) valuation report came back at £125k. We agreed in the end to pay £126,500 for the property. We couldnt/wouldnt pay an extra 5k for it.

Where are you in the chain? are solicitors involved?
Had had solictitors involved by this point so we would both lose out if we had to pull out. Plus anyone else coming to buy the property would get the same valuation. So there a pretty good chance they would never get the price they wanted. Plus costs of putting it back on the market & more solicitor costs, it was better to do a deal.

kate5555

skimper wrote: »

When I started reading your OP it sounds exactly like my situation.

We agreed on £130k (it was up for £135k) valuation report came back at £125k. We agreed in the end to pay £126,500 for the property. We couldnt/wouldnt pay an extra 5k for it.

Where are you in the chain? are solicitors involved?
Had had solictitors involved by this point so we would both lose out if we had to pull out. Plus anyone else coming to buy the property would get the same valuation. So there a pretty good chance they would never get the price they wanted. Plus costs of putting it back on the market & more solicitor costs, it was better to do a deal.

No chain, I'm a FTB and the seller is moving into a relatives property. I've got a solicitor but they haven't done any work yet. If I pulled out at this point, although I would be very disappointed, all I would lose is the £150 for the Homebuyer report.


Before I revised my offer to 120, the sellers EA told me they were still keen to sell to me as she doesn't want to go back to the beginning of the process. The house was on the market since November until my offer in January, and there were no other offers.


skimper - why was yours valued less than the offer price? Was it also in comparison to the sold prices around?

laidbackgjr

kate5555 wrote: »

I fell in love with the house first, then thought about what I would be happy to pay, rather than thinking critically about what the house might be worth. I did look at the sold prices before offering but naively thought it wouldn't be a big deal, thinking a house is worth what someone is willing to pay for it.

A house is worth what someone is willing to pay for it, it's just that for most people the person buying the property is actually the mortgage company rather than the person living there, so the £120k is the value the mortgage company are prepared to pay on, if you want to pay more then you have to put the extra funds in yourself, the mortgage company will not be doing so as they don't feel the property is worth more than £120k.

always_sunny

kate5555 wrote: »

...l I would lose is the £150 for the Homebuyer report.

My cheapest quote for a homebuyer report is £330!!!

kate5555

always_sunny wrote: »

My cheapest quote for a homebuyer report is £330!!!

Yep, a friend of mine also in the same situation was shocked I only paid £150 for it. I applied for a mortgage with Nationwide and used their nominated surveyor (Countrywide) so the report was carried out at the same time as the valuation which is maybe how they can charge less than an independent surveyor? I think it also depends on the value of the house?

skimper

Ours was valued less because of others in the area & there's a lot of modernising to do. There was an old lady in it prior to use who passed away, so every room needs decorating & a lot of artex needs taking off.
We knew all this when we put the offer in & had spare money for the decorating, so the extra we've had to pay has eaten in to that.