Buy my house?... 3 days to decide!

wakeupcall2012

The owner of the house we rent wants to sell. It’s in a lovely rural area, we work locally and have become very much part of the community since moving here 4 years ago. Our options are limited however.

We’ve the option to buy the house but prices are massively inflated due to huge demand for property in the area, so we’d be buying at the top end of our affordability. Everything in the house is dated so also needs a fair amount of money put into it - something we’d just have to do over time. We’ve very little room for negotiation on price given demand in the area and is simply a case of if we don’t buy it, someone else will. But we’d be staying in the house we’ve made our own, in an area we absolutely love and see our future here. There’s nothing else for sale currently in our price range and rarely do they come up, so in terms of buying we feel this is our only option.

Renting another house in the immediate area is also limited. There’s nothing available currently but potentially one that might be available end of the year. This would allow us to stay in the area without a large mortgage commitment and could also maintain our current lifestyle, but all at the risk of us having to move again if/when that got sold.

The third option would be to move out the area altogether, and start our lives over somewhere else, where there’s plenty of property options for sale and rent. Whilst maybe the most sensible option financially, it’s one that neither of us really want to pursue. Leaving our jobs and friends would be heartbreaking.

I wish we had more time to think, but we’ve to let our landlord know our intentions by end of the week. We’ve never owned a house before so it’s all very scary, and certainly never thought we’d be buying at this price level. But there’s huge excitement and the prospect of finally getting off the rental merry-go-round means our lives are no longer in someone else’s control.

My heart’s saying buy it, my head’s saying be careful.

Ahhhh... what to do? Any advice?

anselld

The first two questions before you even consider letting heart or head decide ...

Is the asking price reasonable? Demand may be strong but not at any price. It needs to compare with similar sold prices and it needs to reflect the state of repair and the need for updating. Possibly, for you, it should also reflect that the vendor may not need to pay an agent.

Secondly, can you afford it? Have you spoken to a broker about your financial circumstances and worked out if the deal is even viable.

YBR

We bought from a landlord some years ago.
The benefits include no moving costs, no chain, no packing and unpacking.
You also know the pros and cons of the house really well - another place you risk not discovering them until after you move in.

[Deleted User]

I'd say to the LL you want a survey done on the house before making a decision. There could be more work needed than even you realise.

hazyjo

The LL should let the EA know you may be interested so if can skip their fees later if you do decide to buy.

I doubt very much it will sell as quickly as you think. We'll see. Firstly, it's rented. That will lose them a chunk of buyers. It needs work - that's number two. Thirdly, Brexit. Fourth, it'sammgmg vs. To Christmas and is an awful time to be selling. You may well be better off hanging on to give yourself more negotiating power.

wakeupcall2012

anselld wrote: »

The first two questions before you even consider letting heart or head decide ...

Is the asking price reasonable? Demand may be strong but not at any price. It needs to compare with similar sold prices and it needs to reflect the state of repair and the need for updating. Possibly, for you, it should also reflect that the vendor may not need to pay an agent.

Secondly, can you afford it? Have you spoken to a broker about your financial circumstances and worked out if the deal is even viable.

Thanks for your reply. I’d say reasonable for the area yes, but I think I was hoping for it to be valued slightly less given the dated condition of the house (the estate/lettings agent who we rent through valued it end of last week). They would charge the seller a lower fee if we bought it due to not having to advertise, do viewings etc.. or so I’ve been told.

We’ve seen a mortgage advisor and the figures are stacking up, albeit the monthly mortgage payments would be more than anticipated. We would inevitably need to cut back our lifestyle, holidays etc for a few years whilst we invest back into the house, but not to the extent that we’d be simply existing.

wakeupcall2012

hazyjo wrote: »

The LL should let the EA know you may be interested so if can skip their fees later if you do decide to buy.

I doubt very much it will sell as quickly as you think. We'll see. Firstly, it's rented. That will lose them a chunk of buyers. It needs work - that's number two. Thirdly, Brexit. Fourth, it'sammgmg vs. To Christmas and is an awful time to be selling. You may well be better off hanging on to give yourself more negotiating power.

We don’t have access to our LL directly, only through the estate/letting agents. All comms surrounding the sale is coming from the estate agents, so there’ll be at least some fee for our LL.

The estate agents have told me the value it would go on the market for, and that our LL is willing to sell it to us for less than this. I feel their valuation was inflated to start with so even selling to us at a lower price only seems to put it in the region of what I thought was a realistic starting point. They’ve basically dangled a carrot and know we’re close to biting.

hazyjo

wakeupcall2012 wrote: »

We don’t have access to our LL directly, only through the estate/letting agents. All comms surrounding the sale is coming from the estate agents, so there’ll be at least some fee for our LL.

The estate agents have told me the value it would go on the market for, and that our LL is willing to sell it to us for less than this. I feel their valuation was inflated to start with so even selling to us at a lower price only seems to put it in the region of what I thought was a realistic starting point. They’ve basically dangled a carrot and know we’re close to biting.

So up to you if you want to risk nobody else buying it and them dropping the price (and consequently the price they'll sell to you). If it really was top dollar, I would be very tempted to wait. Like I said, it being tenanted will put loads off.

G_M

Properties with tenants in occupation never sell as fast or easily as either empty properties or owner-occupied properties, as buyers can never be sure if/when the tenants will leave. Or what condition the tenants will leave it in (they are not all as house-proud as you!).

Unless the buyer is another landlord who wants to retain the tenants - but such LLs never pay as much anyway.

What kind of tenancy agreement do you have? Fixed term? Dates? Or periodic?

Have you been served a S21 Notice? Served on what date and with what expiry date? Was it valid? See

S21 checklist (Is a S21 valid?)

You may have a stronger position than you think.

Why not speak to the landlord? If you do not know him, either, pay £3 here to get the property Title and owner's name/address, or write to the letting agent quoting the Landlord & Tenant Act 1985 Section 1.


The LL will also need your cooperation regarding viewings, surveys, Valuation, etc unless/until you have left which could take him months. In contrast, a sale to you makes life easier for him as well as for you.

ian1246

Your talking about buying what is literally your home. Only you can decide whether its worth it. Me personally? If I felt settled somewhere and loved the house I was living in and it then came up for sale, I would buy it - even if it was a little higher than market value - but its your home, go with your gut feeling.

In terms of finances, its worth factoring in the cost of moving/putting a new deposit down on a rental.

In terms of stuff needing doing - draw up a list of structural (i.e. dodgy roof, leaking plumbing etc...) & nice-to-have's. Nice to have's can be saved for in the long-term. Structural is the main concern.

Since your renting, you'll have a very good idea of what needs doing. Get builders/local tradesmen in to give you quotes. This will give you some idea of future cost should you buy it.

The other thing to factor in is that if you do buy it, In theory you should hopefully get your full rental-deposit back. Useful £££ to start making the needed changes to the home?

#############

I'd say buy it. Unless there is anything massively structurally wrong with the place, you can buy it and save up and make the changes over time. I.e. modernising the electrics? Provided the wiring is Ok, just get an electrician in to replace the fuse box (couple of hundred quid) and buy some back-box's and sockets (few quid each) and update the sockets yourself (including chiselling out if upgrading from single to double sockets etc...). New Bathroom or Kitchen? Draw up a budget of current spending, identify potential savings - then save! If they are functional with you currently renting and living with them, surely you can put up with them for a while longer?

Realistically, it could be years before you buy your own place if you don't buy this one (I.e. at least a few months to move to a new rental, get to know your new area and start looking for a house to buy, then a few months for conveyancing etc...). You might as well buy this one and then spend those same years... saving for the changes you want/need to make to a house you already own. Hopefully this makes sense?!

Only you can decide. But what I would say is if you don't go for it and someone else buys it - how will you then feel? Depending on how you feel, that should give you a good indicator of what to do.

Lastly, you can always put a offer in, get it accepted and start the buying process. Your foot is then in the door. Then get the full survey just to double check there is no more work than expected - and if there is, renegotiate as necessary/walk away. This process would be no different than if you were buying somewhere else.

jamesperrett

G_M wrote: »

Why not speak to the landlord? If you do not know him, either, pay £3 here to get the property Title and owner's name/address, or write to the letting agent quoting the Landlord & Tenant Act 1985 Section 1.

If you are seriously thinking of making an offer then I'd suggest getting hold of the title document from the Land Registry anyway. It may just confirm what you already know about the property or it may throw up issues that you will want your conveyancing solicitor to check.