Reducing Offer Price Before Completion Due to Issues

shooze

I am in the process of buying a property I am very keen on. I made the offer in mid May and went in to sign for it on Wednesday last week when the solicitor showed me the questionnaire filled out by the vendor and the complete boundary searches etc.

I originally offered more than the asking price for the house in a sealed bids situation. However with the new issues that have come to light I feel I am unwilling to pay the full asking price.

There is no planning permission or building regs on a 7m x 4.5m extension which was built around 15 years ago. There is also no building regs and the vendor has no idea how the lower half of the chimney breast was removed. I dont even know its safe. An indemnity policy has been taken out to cover both these issues. However it alone has nowhere near the cover I require for possibly putting the chimney breast right if it is found to be unsafe. In fact it does not cover this in any way as it purely states things can be put right if the authorities ever came in and sighted that it was unsafe which is never likely to happen. This is something I definitely need to investigate as soon as moving in. I did ask about this on the first viewing and was told by the agent that a builder had been hired to professionally do it and brought an RSJ he found out he didn't need. However from the legal questionnaire this appears not to be the case and everything is an ‘unknown’

The lack of building regs and planning on the extension I accept is covered by the indemnity policy to a satisfactory level to cover me if anything was to occur in relation to the council on a legal level. However as I was hoping to extend the upstairs of the house in time I now have no idea if footings and walls were built to appropriate regs to do this which might mean a much greater expenditure than originally anticipated.

I have no idea which boundaries I am or am not responsible for. Therefore I have to assume that if a fence is broken and has not been repaired it will be solely my responsibility unless a neighbour agrees to a 50/50 split. A large proportion of the fence along the left hand side of the garden is completely fallen down.

I have no idea who is responsible for a 30+ft tree in the garden other than speaking to a neighbour who says he occasionally cuts a branch off his side. This leads me to believe I will be responsible at least on a 50/50 basis for this tree and the cost of removal which I had a verbal quote for of around £1200 to take down, chip and remove.

The property has a 50 percent flat roof of non standard residential construction. The mortgage advisor was amazed it was accepted. This is completely un related but the vendor should realise it might not be as plain sailing as thought.

Do you think I have grounds to reduce my offer? I proposed £5k off this morning to the estate agent who got pretty crappy with me if Im honest. I do appreciate some people do the whole gazzumping thing but this is not my intention at all its purely to compensate a little for issues that have come to light since making the offer!

ReadingTim

You can ask. They can agree, negotiate a midway point, or tell you to jog on. You can then either jog on or suck it up. All of these things could happen, but no-one can predict what will happen.

Ultimately, there's no right or wrong, nor can strangers on an internet forum referee on what can only be a negotiation and agreement between you and the vendor.

societys_child

TBH, it does sound like you bid higher to to ensure you're offer was accepted, without taking into consideration any extra costs.
When you bid, you must surely have known about the flat roof, the fence and the tree?
If the tree is in "the garden" I would have thought it would become your responsibility if you bought the property. Does it really need to be removed?

As you say, an indemnity policy isn't meant to cover the cost of rectifying any problems which may come to light, it's to cover any problems with the council, which isn't going to happen after so long.

It must be years since the chimney breast was removed, why do think it's unsafe?

kirtondm

I don't see how reducing an offer 3/12 into the process presumbly close to exchange could be classed as anything other than gazundering

Did the mortgage valuation of the property in its current condition come in for the price you paid?

ReadingTim

kirtondm wrote: »

I don't see how reducing an offer 3/12 into the process presumbly close to exchange could be classed as anything other than gazundering

Did the mortgage valuation of the property in its current condition come in for the price you paid?

Errr, no. Price renegotiation following an unfavourable survey report or information coming to light which casts doubt as to the value of the property and which aren't immediately apparent is perfectly acceptable.

It's "sold as seen", so the vendor's job is to make sure it is as it appears to be. If it's not what it's supposed to be, then of course try and renegotiate the price! The question is therefore the extent to which the 'issues' the OP refers to were apparent when he made the offer (like a 30ft tree in the garden), or whether they only came to light later. And materially effect the price.

Gazundering on the other hand, is basically an ultimatum at gunpoint, usually at the very last moment, saying drop the price or I walk away. It's rarely justified with reference to anything, however flimsy.

Personally, I think this is case of cold feet/FTB wobbles...

shooze

ReadingTim wrote: »

Errr, no. Price renegotiation following an unfavourable survey report or information coming to light which casts doubt as to the value of the property and which aren't immediately apparent is perfectly acceptable.

It's "sold as seen", so the vendor's job is to make sure it is as it appears to be. If it's not what it's supposed to be, then of course try and renegotiate the price! The question is therefore the extent to which the 'issues' the OP refers to were apparent when he made the offer (like a 30ft tree in the garden), or whether they only came to light later. And materially effect the price.

Gazundering on the other hand, is basically an ultimatum at gunpoint, usually at the very last moment, saying drop the price or I walk away. It's rarely justified with reference to anything, however flimsy.

Personally, I think this is case of cold feet/FTB wobbles...

This is exactly how I feel in regards to the property is sold as seen. When you make an offer on a property its generally based on very little information. The searches aren't done. The legalities of boundaries etc have not been seen. People who say that you should stick to your first offer no matter what are pretty naive in my opinion.

I had a valuation survey only done. Nothing else. I doubt they even went around the back of the house to look at the roof if Im honest. I read somewhere nearly 60 percent of valuation surveys are basically drive bys. I am not bothered by the roof at all as you can see from my post. I've not mentioned this to the vendor as this is something I'm personally OK with, but it would effect her selling to someone else Im sure.

The huge tree is exactly on the boundary so its not clear cut who's it is. Of course it was there at viewing, but I expected the searches to tell me which boundary and thus, which trees I am responsible for.

The chimney breast is my main issue. It might have been hanging there for 10 years but if its not done safely then I dont care how long its been there its always going to be a risk.

Im not Gazzundering in any way as honestly if these issues had been addressed either by proving the chimney is supported or letting me know which boundary is mine then I would not have lowered my offer at all. As the vendor knows nothing about this Im simply trying to cover potential costs of putting these right.

Im not a first time buyer, I own a rental house which I just moved from after being in that 8 years. I didn't do this buying that place, in fact the agent told me as I was signing that another person had made a higher offer! Being young and naive at the time I went with it and offered more again. I know now that this was probably a typical estate agent with their own mortgage advisor trick!

Thrugelmir

shooze wrote: »

I read somewhere nearly 60 percent of valuation surveys are basically drive bys.

Do you seriously believe that lenders part with six figure sums on properties that haven't been inspected? Likewise that professionally qualified people put their livelihoods on the line with speculative valuations. This isn't the Wild West......

lisssa

Actually they do ! I am in the process of buying a new house 320k with a 60% mortgage and when my mortgage application was submitted ( barclays) I was told that no valuation survey was required it had been done automatically ?! Must admit I was surprised but the offer is all confirmed now so no survey from them required !

SeduLOUs

Thrugelmir wrote: »

Do you seriously believe that lenders part with six figure sums on properties that haven't been inspected? Likewise that professionally qualified people put their livelihoods on the line with speculative valuations. This isn't the Wild West......

Mum and Dad sold their house a couple of years ago and were due to go on holiday shortly after receiving an offer. Were told not to worry about the lender's valuation going ahead while they were away as they didn't need to enter the property...

pinkpiglit

lisssa wrote: »

Actually they do ! I am in the process of buying a new house 320k with a 60% mortgage and when my mortgage application was submitted ( barclays) I was told that no valuation survey was required it had been done automatically ?! Must admit I was surprised but the offer is all confirmed now so no survey from them required !

Yep, I agree. Not quite the same but we are remortgaging and new mortgage will also be with Barclays (currently with Nationwide).

On the application form I suggested our flat had increased by 16% since we bought it three years ago @ £875k. Barclays approved the mortgage and INCREASE their valuation estimate by a further 2%...... and they didn't visit the property to check it out. It may be due to our LTV which is sitting around 50%.

cjmillsnun

You have a valid concern and have grounds for a further structural survey being carried out. I would arrange this and ask your solicitor to put the process on hold pending the result of this survey. If they find no issues then you can proceed at the agreed price (although you can make further enquiries about the tree). If there are issues found the depending on the issues you can either renegotiate your offer accordingly or walk away.