Looking to offer...

middleclassbutpoor

Seen a house that is in need of some modernisations on at 375k

House has been on market for a very long time ( couple of years) and is currently empty but has been let out in that time - with the most recent ending in late spring this year. Owners have moved abroad. They are selling so they can fully live their life in their new country ( agent said the sale will allow them to buy abroad)

Having looked around the property, we believe based on very rough estimates that it is going to need about 40-50k spending on it which the majority of that is going to be new glazing(28 windows - glazed front door with side glazed panel, back door and patio french doors), new kitchen (Which sits in a room side of 6m x 4m approx) and 2 new bathrooms which need gutting and re-tiling and all replacing.

(We are based in the north btw in a town in terms of location)

The house isn’t in bad nick overall from what I can see- has been looked after but just not updated within last 15-20 years...

My question is whether my pricing approach is a sensible one?

I have asked the agent what the house would be worth fully modernised and surprise surprise they have said 50k more than asking- possibly 75k..

To me this doesn’t give me much room for uncovering the unknowns that can come with renovating- nor does it seem right that I would pay a cost that leaves little wiggle room.

The house was first offered on the market at 45k more than it’s on (420k) 2 yrs ago. They have dropped to 375 recently but we are going to offer below this. This will help me understand if my planned negotiation strategy is too harsh....

Would welcome your views based on the info here, where you would price your offer to make it worthwhile taking on such a project to give you a family home for the next 10-15 years?

bigstevex

Would you share the link to property, gives us a little more to go on?

Price it's on at means nothing if it's not worth it. You always offer what you feel it's worth, if they reject it, then you have to just walk away if they want more than what you value it at. The fact it's been on for years says to me they won't take lower offers (perhaps deluded at it's value) or people are uncovering serious issues you may have missed (i.e. other builders/developers who looked at it)?

Ps, if it's empty, why not get a viewing and take tradesmen with you to get more detailed quotes (they may also pick things up that you've not spotted/thought of)

need_an_answer

a link would be very good.

the problem with renovation projects or something that needs updating is the desire to want to reduce the asking price to reflect your personal tastes and incorporate your renovation costs into the offer you make.


sometimes that does work however a lot of the time the property has already had that factored in and the price is substantially less than a renovated property in the same area.

your post seems to suggest that the property is dated but not unlivable so my guess would be that actually you are hoping to get the vendors to reduce the price to accommodate the work you want to do to make it your home...it doesn't always work that way!

Having done a few renovations of very tired properties my advice would be to always have a healthy contingency budget the property will uncover something you've not factored in.

my other advice is don't become too hung up om the price post renovation,you will never get your money back in the short term especially if the renovation is done well....hang on to the property and live in it,enjoy it and hopefully it will appreciate in value over the coming years.

middleclassbutpoor

Thanks both...

We believe that the vendors tried the market 2 years ago, then rented out, then when the tenants left, tried the market again and reduced and then rented out again and have reduced again recently.

They had an offer which fell through because of the recommendation to put some kind of drainage outside which would have cost less than a grand and the people buying didn't want to do any work.

I think if you were to look at it with a neutral set of eyes - there probably isn't enough work for a developer

I don't want to post a link - purely because of privacy reasons rather than being awkward. Very simply I guess I was trying to understand how the vendor may view my offer and the strategy I was employing.

You have given me some insight into the 'it's just personal taste versus yes we know that needs updating' type consideration and there is definitely an element of that within our costing so thank you. I certainly have a view of what we can afford and think it's worth so will be prepared to walk away if we cannot get within those values.

Going to view the house again today to look at things more closely this time... Will see where that takes us.

AlexMac

Sellers often seem to have unrealistic expectations, and if they've been away, may not realise how local prices have dropped. Zoopla values trends graphs and table are (in my experience locally at least) quite useful indicators of local % falls or rises in the past 1, 2, 3 or more years.

Which of course may not persuade...

We bought a house from someone in your position; overleas and letting, so even though it was not need ing major work, it was bery tired; needing refreshment ratherthan refurb after a succession of tenants. We got £30k off, which was a decent 3%, and that in a fast-moving sellers' market 7 years ago...

So give it a go; for £50k you should easily do the work you plan; in fact that should also cover a modest extension, or at least opening out internal walls for a bigger, flowing kitchen...

But the vendor might think that as these enhancements are optional, they shouldn'y cover the lot. We've spent the "saved" £30k since buying- a major conversion of a garage into an insulated, heated, multi purpose room with an en-suite shower/loo (+1 room=added value!), turning the guest bathroom into a refurbed walk-in rainshower, and a re-newed kitchen with lots more units; a little DIY but mostly professionals- ant that at London prices.

So there is room in your negotiation for a bit of upwards creep in your offer; and you'll have the ideal home at the end, with your own stamp on it.

So go in hard, have an upper limit in mind, and maybe stress your advantages; solicitor identified and ready to act, finances in place, ready to sell your existing gaff, no chain? ..etc, etc

Good luck

Thrugelmir

middleclassbutpoor wrote: »

Very simply I guess I was trying to understand how the vendor may view my offer and the strategy I was employing.

Vendor has a figure in mind. No amount of waffling on your part is going to make any difference. Offer what you are prepared to pay. Then a conversation will start via the EA. You'll soon have an indication as to how flexible they are willing to be.

middleclassbutpoor

Been out, I was advised that an offer which was within 10k of the asking...

I explained that wasn't really where I was. Have offered £325k on the basis that I want the house for 10-15 years for our family home and to get it to the standard we want it at, that is the price that works. We have also a shortlisted other house which we are quite happy to offer close to asking on if we can't get this.

Will wait and see what comes back. Could be a slow one this with them being in a different timezone.

AnotherJoe

middleclassbutpoor wrote: »

Been out, I was advised that an offer which was within 10k of the asking...

I explained that wasn't really where I was. Have offered £325k on the basis that I want the house for 10-15 years for our family home and to get it to the standard we want it at, that is the price that works. We have also a shortlisted other house which we are quite happy to offer close to asking on if we can't get this.

Will wait and see what comes back. Could be a slow one this with them being in a different timezone.

I don't understand why people think that an explanation of why they are offering less than AP is relevant except in one case, "I can't afford any more ". Other than that if I was the vendor I'd just hear blah blah blah less than AP blah blah blah.

Crashy_Time

AnotherJoe wrote: »

I don't understand why people think that an explanation of why they are offering less than AP is relevant except in one case, "I can't afford any more ". Other than that if I was the vendor I'd just hear blah blah blah less than AP blah blah blah.

"It`s over-priced" is another good one. If the seller hears it enough they may eventually get the message?

AnotherJoe

Crashy_Time wrote: »

"It`s over-priced" is another good one. If the seller hears it enough they may eventually get the message?

Fair point succinctly made. Who are you and what have you done with Crashy?

middleclassbutpoor

I was quite to the point. I said where I was at and that was not where his vendors were comfortable.

The explanation I gave was that the deal has to be financially right over everything else for me to modernise to my standards.

I have another 1-2 properties on my shortlist so if this one doesn't work financially, I will move on to the next.