Should I delay the exchange of contract beyond 31 Oct

opteron

Hi,

I'm in the process of buying a flat in east London. Asking price is 600k. I made an offer at 550k a month ago, which has been accepted. Currently the solicitors are progressing with the legal stuff. It's still in the stage of ordering searches. Exchange date hasn't been ironed out yet, but a reasonable estimate is September as there's no chain.

However, I'm deeply worried about no-deal Brexit. It is wide consensus that there's going to be a big correction in London housing market under such scenario. If no-deal happens or becomes substantially more likely to happen, I will press the vendor to further lower the price before exchange. If the vendor refuses to do so, I will probably walk away.

I was thinking about delaying the exchange of contract to early November. I feel deeply uncomfortable to exchange before 31 Oct, unless the vendor drops the price to 500k. Am I being unreasonable here? Should I inform the estate agent now, or wait until September for a bit more clarity on Brexit? (also the contract is not ready yet anyway..)

Any suggestions are welcome! Thanks.

AFF8879

When did you make the offer? Surely you were aware of the risk of Brexit given the referendum was over three years ago now?

Secondly, if there really is a “no-deal”, and it is as disastrous as many are making it out to be, do you really think a measly 10% is going to make a difference?

You are of course free to do whatever you wish up until exchange, but for both your sake and the sellers, it may be easier for you to just pull out now and let them remarket the property, as you don’t seem particularly cut out for dealing with potential economic swings. Then, you can resume your property search in full confidence in the new year (even though the Brexit saga will probably still be ongoing then too...)

davidmcn

The betting markets aren't convinced there'll be any sort of Brexit by the end of October, never mind a no-deal one. And even if there is, nobody's going to have any better idea of its effects on the property market by early November. And I'm not sure there'll necessarily be any sudden and significant effect anyway, given that the high likelihood of some sort of Brexit has been factored into the market over the past 3+ years. Though this is possibly all speculation better placed over on the other board.

muhandis

OP, there’s a lot of this going on, if you look at the other threads as well. Given the price you’re buying at, the potential stamp duty changes might also come into play.

Having said that, if you’re buying a place to live in, have a fairly secure career and expect to live in east London for the foreseeable future, you don’t need to look at it as an investment.

No one can predict what’s going to happen. We might go back to the “normal” of steady rise in prices or maybe enter a Japanese spiral of ever decreasing prices, who knows!

If you’re really worried, in your place I’d consider continuing renting rather than delay till November. Oct 31 might just be the start of uncertainty rather than the end, again who knows.

kinger101

You should probably withdraw from the sale now. You are not sufficiently confident or motivated to exchange.

AnotherJoe

opteron wrote: »

Should I inform the estate agent now, or wait until September for a bit more clarity on Brexit?

Is that a joke? Assuming not, there likely wont be clarity on Brexit on November 1st, let alone mid Sep, at which point there absolutely will not be any clarity about Brexit whatsoever.

opteron wrote: »

Any suggestions are welcome!

As someone else posted, pull out and wait until things have settled down, probably about 2-3 years time

Doozergirl

You either buy it or you don't. Don't string people along when there will no actual answer on the 1st November.

You either want your own home now, or you don't.

You will be a home owner for the rest of your life. All the peaks and troughs level out anyway and the trajectory is still ever more expensive house prices.

verybigchris

You delay the exchange to early November, and then it transpires that no-deal Brexit is ruled out and the London housing market immediately soars on the news. Your vendor turns round to you and says "thanks for delaying exchange, now I want £700k from you or it's going back on the market". Would you still be happy to renegotiate?

davidmcn

AnotherJoe wrote: »

As someone else posted, pull out and wait until things have settled down, probably about 2-3 years time

And bear in mind there were probably some people who did that in June 2016...

Surrey_EA

I am confused what has changed over the past month?

Your post suggests that you are not mentally ready to purchase a property at this time, therefore it is probably best you withdraw sooner rather than later to avoid messing those involved around any further.

muhandis

1. Change in government with a completely new attitude to the question of Brexit (which I'm sure you will agree is true, irrespective of which side of the fence you come down on).

2. Plans have been leaked from the above government which indicate a possible wholesale reform of the stamp duty regime. Not saying it will/will not happen but it can't be discounted completely.

Now you personally might not think either of the above are a big deal but equally there are likely to be people who do think it is.

Surrey_EA wrote: »

I am confused what has changed over the past month?