Homebuyer survey has revealed expensive damp issue

JT1987LBN

Hi all
I have put in an offer for an older property recently which was accepted, and we fully expected a fair bit of work on the property so have set aside quite a bit of money for this work. Our Homebuyer survey has just been done and confirmed that there is indeed a lot of work to be done, and unfortunately they have reduced our mortgage offer from £185k to £182k. We are going to go back to the estate agent to say we are unable to pay the original price of £185k as we cannot get a mortgage for this amount, and would they accept a reduced £182k. I want to put it to the estate agent that we are fully understanding that as the property is older we expected and budgeted for several issues, but the damp issue has caused the valuation to be dropped by a  lot more than expected, and we unfortunately do not have £3k spare to add to the deposit (on top of £3k to fork out for the damp issue). My question is, does anyone have experience with sellers being awkward about this, even when the valuation is stating the property is worth less due to the damp issue? And how is the best way to negotiate? Thanks in advance.

NameUnavailable

What exactly is the damp issue?

I would put details in writing to the agent, state a list of the works required and an approximate cost (inflate it a bit as there will always be something else you haven't seen yet) then ask for the reduction you need.

It's better to justify it rather than the vendor just getting a call to say their buyer wants £X off the price. Also they need to consider that another buyer may come back with the same issues if they went back on the market.

Of course your vendor may need £182K and might not also have anything left in the pot to help you out. But you can only try. In the current market I expect they won't want to lose a buyer. Good luck!

AnotherJoe

Some sellers will cave, some will pass it on to their purchase, some will negotiate a half way (or other) point, some won't budge. 

I would write a short statement to the points you mentioned (Just reuse those words) and include a section of the survey showing the reduced valuation. Make it clear to the EA you are at your limit and can't negotiate. 

And then it's over to them. 

JT1987LBN

NameUnavailable said:

What exactly is the damp issue?

I would put details in writing to the agent, state a list of the works required and an approximate cost (inflate it a bit as there will always be something else you haven't seen yet) then ask for the reduction you need.

It's better to justify it rather than the vendor just getting a call to say their buyer wants £X off the price. Also they need to consider that another buyer may come back with the same issues if they went back on the market.

Of course your vendor may need £182K and might not also have anything left in the pot to help you out. But you can only try. In the current market I expect they won't want to lose a buyer. Good luck!

Thanks for your reply, it's a bigger issue than expected as there is no damp membrane (I'm not technical at all so hoping I've used the right terminology) to the edges of all of the rooms, so basically it's just concrete around the edges so the surveyor has advised nearly every floor in the house will need to be pulled up, and a damp membrane added to all floors to the edges of the room. The house has loads of other things that need fixing (windows are over 20 years old, kitchen and bathroom need replacing, insulation etc) but we fully expected those to cost us a few quid. This damp problem is bigger than we thought and it's the reduced mortgage which is the shock for us (we are probably a bit naive haha) .

JT1987LBN

AnotherJoe said:

Some sellers will cave, some will pass it on to their purchase, some will negotiate a half way (or other) point, some won't budge. 

I would write a short statement to the points you mentioned (Just reuse those words) and include a section of the survey showing the reduced valuation. Make it clear to the EA you are at your limit and can't negotiate. 

And then it's over to them. 

That's great - will be doing that. We have been asked for a copy of the survey to send to the estate agent - this is where I'm a bit nervous as I've heard sometimes you aren't meant to share anything like that. If it helps knock the price down though, seems sensible.

AnotherJoe

JT1987LBN said:

AnotherJoe said:

Some sellers will cave, some will pass it on to their purchase, some will negotiate a half way (or other) point, some won't budge. 

I would write a short statement to the points you mentioned (Just reuse those words) and include a section of the survey showing the reduced valuation. Make it clear to the EA you are at your limit and can't negotiate. 

And then it's over to them. 

That's great - will be doing that. We have been asked for a copy of the survey to send to the estate agent - this is where I'm a bit nervous as I've heard sometimes you aren't meant to share anything like that. If it helps knock the price down though, seems sensible.

I wouldn't give them the whole survey just the lower valuation page and the reason for it. You don't want to get into a dispute about costs, you need to make it clear that it's the lender offering less that's forced your hand. That way it's not about you and they can get annoyed at the lender not you. 

FreeBear

How old is the property ?

If it is an older build and the concrete floor has been added at a later date, walking away may be a wise option.

A fairly new build (1960s onwards), a solid concrete floor isn't always a bad thing. Digging it out completely and replacing with a well insulated floor would be worthwhile in the long run - Doing it before moving in gives you the opportunity to install channels for wiring & plumbing and underfloor heating. Not a cheap schedule of works, so it really depends on what your long term plans are for the property.

Doozergirl

JT1987LBN said:

NameUnavailable said:

What exactly is the damp issue?

I would put details in writing to the agent, state a list of the works required and an approximate cost (inflate it a bit as there will always be something else you haven't seen yet) then ask for the reduction you need.

It's better to justify it rather than the vendor just getting a call to say their buyer wants £X off the price. Also they need to consider that another buyer may come back with the same issues if they went back on the market.

Of course your vendor may need £182K and might not also have anything left in the pot to help you out. But you can only try. In the current market I expect they won't want to lose a buyer. Good luck!

Thanks for your reply, it's a bigger issue than expected as there is no damp membrane (I'm not technical at all so hoping I've used the right terminology) to the edges of all of the rooms, so basically it's just concrete around the edges so the surveyor has advised nearly every floor in the house will need to be pulled up, and a damp membrane added to all floors to the edges of the room. The house has loads of other things that need fixing (windows are over 20 years old, kitchen and bathroom need replacing, insulation etc) but we fully expected those to cost us a few quid. This damp problem is bigger than we thought and it's the reduced mortgage which is the shock for us (we are probably a bit naive haha) .

Adding a damp proof membrane to the edges doesn't stop dampness from creeping up the walls. 

Please have a look at how extensive the issue actually is first.  Those 'damp meters' they use don't diagnose damp.  If there is an issue, it won't be invisible.  You'll either see it or smell it.  For it to be 'extensive' then you really would be smelling it.  

I doubt that you'll need to pull up every floor.  The first thing to do is to find out why the ground underneath is wet.   It shouldn't be, so you fix whatever that is and then wait for it to dry out.  

You don't want to damp proof an older house, so the solution is actually to allow walls and floors to breathe.  You can cut a channel about a foot back from the wall, breaking any damp proof membrane on purpose(!) and putting limecrete instead of concrete around the edges, which is breathable.  For the walls, you would like plaster affected areas, not gypsum plaster or render. 

In summary: 
1. Is there actually damp 
2. where is the water coming from
3. Let the house breathe, not wrap it in plastic! Plastic is for new houses, NOT old ones.  

https://www.heritage-house.org/damp-and-condensation/managing-damp-in-old-buildings.html

I won't say anything about the negotiations on price, as you've had sensible advice already.  

youth_leader

Thanks for the interesting article Doozergirl.  I was very upset about my buyer's mortgage company insisting I invite a damp/timber specialist to inspect.  I was railroaded into paying for it too.

AdrianC

JT1987LBN said:

Our Homebuyer survey has just been done and confirmed that there is indeed a lot of work to be done, and unfortunately they have reduced our mortgage offer from £185k to £182k. We are going to go back to the estate agent to say we are unable to pay the original price of £185k as we cannot get a mortgage for this amount, and would they accept a reduced £182k.

Were you absolutely hard against the top of your affordability anyway?
Because, if not, then it's not a showstopper.

Let's say that you have £37k equity, so would have been looking at an 80% £148k LtV mortgage. At a valuation of £182k, that's only just over 81% LtV. Even with 85% being the max most lenders are going for, that's still well within affordability.

Don't spin tales about "can't possibly afford to", unless you REALLY know you absolutely cannot. It's £3k. Houses can swallow £3k at any time without blinking.

My question is, does anyone have experience with sellers being awkward about this, even when the valuation is stating the property is worth less due to the damp issue? And how is the best way to negotiate?

You ask. They may say yes, they may say no. If they say no, you need to decide whether to walk away or not...

blue_max_3

If I was selling a period place, I would be selling the dream. There are plenty of people looking to pick something up and create the place of their dreams. I can't imagine many people just moving in and not doing anything to it. This is relatively minor in the great scheme of things. And as has been mentioned, the opportunity to put underfloor heating in would be amazing! I put a wet system in a basement and it was awesome!