Is estate agent telling porkies?

MissPony

Cakeguts wrote: »

What you need to know is that many properties than need renovation don't sell for much less than one that has been renovated. So your offer needs to be in the region of the one that sold nearby 2 years ago so on that basis £225k sounds like a reasonable price. You are not going to get the 40k that you want to spend on it as money off the purchase price.



I assume that someone was living in the house before it came on the market so that means that you could live in it as it is. You won't get a 40k reduction because the internal fittings are old and not to your taste.

Maybe I misunderstand you, but who would pay the same price for a property that requires £40k work and materials spent on it to bring the property upto the same standard as one that is already at that standard.

Watch any of the tv programmes on property development.
Houses are bought at a price that will allow them to be improved, and then sold on at a profit.

So if the house is worth £225k today if it was brought up to the required standard, but it will cost £40k to bring it up to that standard, then the most that should be offered is £185k, perhaps a bit less to allow for taxes, reselling costs etc (if doing so as a business) or to compensate for some of the issues living on a building site whilst the £40k work is being done (or the cost of living elsewhere if that is the plan). Otherwise buy the house that is already done up.

MissPony

suffolkboy_ wrote: »

...

The house is technically habitable by mortgage standards - it has a working kitchen and bathroom. My next concern if I do get an offer accepted is a potential lender offering me what I need to buy it....I'm not a cash buyer and will be requiring a mortgage with a 90%LTV

Best of luck with that then. :cool:

You may be confusing the notion of mortageable with one of what value the property will be valued at in it's current condition.

If you don't have the £40k (after buying the house), then it's going to be an uphill struggle ... even if someone gives you a mortgage at the outset, even a staged payment one.

suffolkboy_

MissPony wrote: »

Maybe I misunderstand you, but who would pay the same price for a property that requires £40k work and materials spent on it to bring the property upto the same standard as one that is already at that standard.

Watch any of the tv programmes on property development.
Houses are bought at a price that will allow them to be improved, and then sold on at a profit.

So if the house is worth £225k today if it was brought up to the required standard, but it will cost £40k to bring it up to that standard, then the most that should be offered is £185k, perhaps a bit less to allow for taxes, reselling costs etc (if doing so as a business) or to compensate for some of the issues living on a building site whilst the £40k work is being done (or the cost of living elsewhere if that is the plan). Otherwise buy the house that is already done up.

Hence my original offer - I don't think this one is worth £225k.

The issue I have is that houses in this village hardly ever come up for sale - maybe one a year. Most of these are well out of my price range.

I'm looking at this as a long term home, so do need to get out of that mentality of looking at Sale Price + Renovation Cost = Value. In the long term, it will be worth more than I'd have spent.

Luckily I'm in a position to live elsewhere with parents whilst renovating.

AdrianC

MissPony wrote: »

Maybe I misunderstand you, but who would pay the same price for a property that requires £40k work and materials spent on it to bring the property upto the same standard as one that is already at that standard.

Not necessarily the same price - but certainly more than basic maths would suggest.

And the answer is simple...
- Optimists who haven't done the maths.
- People who want their own taste and layout, rather than choosing to remove perfectly good decor/kitchens/bathrooms

Watch any of the tv programmes on property development.

Aha. This may be the problem...

NEVER believe daytime TV.

So if the house is worth £225k today if it was brought up to the required standard, but it will cost £40k to bring it up to that standard, then the most that should be offered is £185k

I admire your optimism...

perhaps a bit less to allow for taxes, reselling costs etc (if doing so as a business)

No, it simply isn't a viable purchase to be profitable. If it was, then somebody would already have bought it for that purpose - somebody who isn't paying labour or retail price for materials...

Otherwise buy the house that is already done up.

Then spend £20k on changing it to suit your taste, because you don't actually like the colour of the newly-fitted kitchen...

suffolkboy_

MissPony wrote: »

Best of luck with that then. :cool:

You may be confusing the notion of mortageable with one of what value the property will be valued at in it's current condition.

If you don't have the £40k (after buying the house), then it's going to be an uphill struggle ... even if someone gives you a mortgage at the outset, even a staged payment one.

I know for a fact it was valued at £225k at probate so my hope it would be valued at a similar level when valued by the broker....we'll see.

Smodlet

MissPony wrote: »

is the Pope a Catholic?

Do bears deficate in the woods?

No. They defecate in the woods. Someone was gonna...

MissPony

suffolkboy_ wrote: »

Hence my original offer - I don't think this one is worth £225k.
...

suffolkboy_ wrote: »

I know for a fact it was valued at £225k at probate ...

It's value is what someone else is prepared to pay for it.

The professional valuer would have based the value on what a property of that type and condition would be expected to sell for (based on an understanding of what property sells for in the locality)

Obviously, not the house for you.

Move on. You'll find the right property for you eventually. Hopefully

Crashy_Time

Just let them sweat their way through Brexit, then make another lower offer.

Chandler85

Pay what you think it is worth. If you offered 5k over there minimum amount, then who cares. You made an offer of what you thought it was worth and got it.


If the valuation is the same then what's the problem.


If you do a stupid low offer, because you know someone who will benefit from the will and they told you someone else was desperate, then you will be labelled as a chancer (and rightly so) and the seller may question your morals as well. You have gone from 165k to 195k in one big jump, it proves you were a chancer to the vendor.


You should have started way higher with a smaller increment, accept you might spend 40k and get a 25k return but you have a house you want.

kiddy_guy

The fact that your 2nd offer - well below asking price and the other (fictional) full asking price offer they have, wasn't met with a "Why are you making offers that aren't above full price as that's what we've got" tells the story.

They want more money - that's fine. The fact they're bouncing you against a fictional offer means either they have a builder mate lined up to take this, or the vendor wants silly money.