How Do I Negotiate A Decent Price On a Flat?

consumer23

Dear Forum,

I am intending to buy a flat, and I am a first time buyer. I don’t want to copy in a link to the flat in this forum as the seller could see what I am trying to do. I am looking of finding ways of negotiating a lower sale price on the flat. As I am a first time buyer, I am completely new to this.

What anyone on here will not be aware of is that there are 97 years left on the lease, which is one tool I intend to use for bargaining a lower price as I will either need to pay for a lease extension if I live in there for any significant amount of time & even if not then the people I eventually sell to will have to so they will knock this off the price.

What I have also done is taken 4 properties that have been sold in the same block in the last 3 years and worked out the average/mean selling price of all of them put together, bearing in mind that all properties are 2 bedroom flats (as is the one that I am looking to buy).

I would be interested to hear if anyone has any tips on bargaining/negotiating a cheaper price and what people think would be a fair price.
A few additional points, the boiler was installed in 2012, the furniture you see in the add is not included, although this could form part of the bargaining i.e. they leave more/less, I pay more/less for it.

The postcode of the flat which is written backwards (so the seller doesn’t recognise it if searched for) is: LS591SW.
There is only 1 flat on sale in this block and the block of flats name starts with oat……..court.

Would Carney’s prediction of a possible 35% housing crash be worth bringing into the bargain?

Thanks forum

[Deleted User]

I can't see anything there that would justify a lower price.

The lease is still a decent length.
Sales from 3 years ago of different flats are irrelevant.
It has a new boiler.
Furniture is never included as standard in a sale. You would need to offer accordingly if you wanted to keep it.

If you feel it's overpriced, use recent selling prices from the area as a comparison.

And of course, only offer what it is worth to you.

kinger101

You thinking about this too much. The vendor has a price they'll accept. Match or exceed that, and it's probably yours. Unless someone comes along with a better offer or looks like a more sound buyer.

Would Carney’s prediction of a possible 35% housing crash be worth bringing into the bargain?

Only if you want them to think you're not a credible buyer. If you're so convinced, buy at a 35% discount after the crash.

Don't pay any more than a nominal amount for the furniture. Chances are LL wants to save the effort of transporting it to the local tip. You can furnish a flat well under a grand with second hand stuff if cash is tight.

Cakeguts

One thing you have to be aware of is that some mortgage lenders won't lend on ex local authority flats over a certain floor. Also service charges on ex local authority flats can be very high.

eddddy

consumer23 wrote: »

I would be interested to hear if anyone has any tips on bargaining/negotiating a cheaper price and what people think would be a fair price.

Price negotiation is more related to the seller's position, the seller's mindset and psychology, than most of the other things you mention.

For example,...

• If the seller is desperate to sell/move, they're likely to accept a lower offer.

• If the seller believes that they can get full asking price by waiting a few weeks, they won't accept a low offer from you.

• If the seller is planning to upsize, but is a little worried about about future prices dropping, you might have to offer more to persuade them to take the risk of upsizing.

And realistically - EAs are used to buyers 'spinning' stories to justify low offers.

I suspect the EA will be even better at 'spinning' stories back to you about why you should offer high.

And they probably won't mention your 'spin' when passing your offer to their client.

badger09

It looks like a decent flat, but I have no knowledge of the local market.

It depends on the reason there is 'No onward chain', which could work for or against you.

It hasn't been on very long (9 weeks) and without knowing what interest there has been, there is no way of knowing whether vendor will consider offers.

Have you viewed it yet? How does it compare to others in the same price range?

davidmcn

AFF8879 wrote: »

The postcode even backwards does not exist according to Rightmove or google maps...

More of an anagram than "backwards" - try SL591WS.

As mentioned, mortgageability of high-rises is an issue (probably less so here because it's London). I'd be wary of whatever post-Grenfell improvements start being recommended.

SMR710

As mentioned previously, I agree the seller will have a price in mind and if you match the price / price range they have and you can evidence your funds then you'll probably get the sale. If it's not got other interest you could go in with your price and see how this fairs against theirs. If negotiations are going backwards and forth, just maybe say "what is the price you're wanting?" and if it's a price you're prepared to paid then wham-bam thank you ma'am!
When I do ally list mine, I'd love an interested party to just ask me what the price I'm prepared to accept is! Cut out all the bluff

AdrianC

End of the day, OP, it's very simple. You are trying to persuade the vendor to accept your offer.


The vendor is an individual who wants to get the highest possible price for their flat, because they want to move elsewhere. They also want a nice simple, low hassle deal - for which they might be persuadable to go with an offer that's a tidge lower.

You are looking to buy in a fairly desirable bit of SW London (if I've understood the secret squirrel postcode rubbish correctly), and so are a lot of other people. So you are not looking at a flat that's going to sit on the market for ages, if it's priced correctly. If it doesn't sell in short order, then it's probably because the vendor is being optimistic.

consumer23

Cakeguts wrote: »

One thing you have to be aware of is that some mortgage lenders won't lend on ex local authority flats over a certain floor. Also service charges on ex local authority flats can be very high.

The Service charges on this flat are approx £1k per year, so around £83 per month.

consumer23

Sunny_Intervals wrote: »

At 97 years, you've got 17 years to extend it before the price jumps and 97 years to extend it before it reverts to the freeholder. No-one is going to give you a discount for that. If the lease was approaching 80 years and the marriage value was looming or it was short enough that getting a mortgage would be a problem, you might have a point, but not at 97 years.


Just averaging other sale prices won't work, because it doesn't take into account the condition of the properties.

I would agree with your statement that averaging the price out of other sales may not work due to the condition of the other properties, however when I asked the estate Agent how they came to the asking price of this flat, they quoted what other similar properties in the area fetched and based their price on that, so I thought I'd do my own short survey of flats in the area to find out what the average price would be.