Unable to view new apartment without my current property being sold?

Jlawson118

So I've currently got a ground floor, 1 bedroom apartment with a private garden that I bought two years ago for £98,000. There's currently £80,000 remaining on my mortgage.
I've been considering up-sizing to a two bedroom, but I think houses are a little out of my mortgage budget at the moment, and there's currently a new apartment development going on in my local village and over the last few days I've been curious about a viewing. If interested, I was considering a part exchange if available, if not, turning my current property into a Buy To Let or putting on the market.

There's a show flat, which you can see from the outside they've added furniture whilst finishing the others off, photographs of these also appear on Zoopla and the local estate agent that is selling them. 

I've since contacted the estate agents who contacted the developer and got back to me today. Stating that I wouldn't be able to part exchange and I was unable to even view the current apartment until I'd already officially sold my current one. Which seems a little iffy to me? It would be my first time selling so I'm not 100% on the ropes, but the girl on the phone seemed quite condescending, stating that this is normal in the current market. But regardless, requested I booked an evaluation. I just politely declined.

My question is, is this normal practice?
I can't understand why my current home would have to be sold in order for me to view a new home before even committing? 
Say my current home was sold, I visited the new site and didn't like it, then what? Or say my mortgage on a new one fell through, would that essentially make me homeless?
Apparently this is all due to the developers wanting 'reliable sources', Does this mean I'd have to officially purchase before I could even get a surveyor in?

davidmcn

They just mean having a sale agreed in principle, not you already being committed to a sale (though I don't know what they meant by "officially" if that's really what they said) - normally you'd exchange contracts for your sale and purchase simultaneously.

Jlawson118

davidmcn said:

They just mean having a sale agreed in principle, not you already being committed to a sale (though I don't know what they meant by "officially" if that's really what they said) - normally you'd exchange contracts for your sale and purchase simultaneously.

She worded it as ‘officially’ too, which is what’s thrown me. I asked her the question “presuming I viewed the flat and made the offer and my mortgage fell through very last minute, wouldn’t that essentially make me homeless?” As I couldn’t turn away a new buyer of my current property to move in when there’d be an agreement date. 

All her response was is that this is how the current market is. I tried to explain obtaining a mortgage wouldn’t be an issue, nor a deposit. All I wanted was a view on the apartment and I could make a decision to put my current on the market and work onwards from there. 

This exact same estate agents messed me about just over two years ago when I was looking at another property to the one I’m in now. They invited me for a viewing and then told me on the same day I couldn’t make an offer because somebody else already had. Then asked me two days later if I wanted to buy the property when I’d made the offer on my current. 

I think this is a sign to just stay away from that particular agent 🤦🏻‍♂️

AdrianC

Jlawson118 said:

So I've currently got a ground floor, 1 bedroom apartment
...
I was considering a part exchange if available

I wonder why they might not be keen on PXd flats in the current market... How big's your block, and what's the cladding/EWS1 situation?

Would they be trying to sell it in competition to their own new-build 1beds...?

if not, turning my current property into a Buy To Let

You've only got £18k equity in the property. If the value is static from purchase (unlikely, especially if it was newbuild at the time), that's >80% LtV. So are you hoping for open-ended CtL on your existing mortgage? Or do you have substantial savings to increase your equity to 75% max LtV for a BtL mortgage, while simultaneously raising 15% equity for an 85% max LtV on your purchase? 

Do the maths on starting such a highly-leveraged letting business make even the vaguest sense, even before you consider the +3% SDLT and the mortgage interest tax situation? 

or putting on the market.

How long will it take to sell...?

eddddy

I think you're misunderstanding a little bit.

• Realistically, as a first step, you need to get your current flat on the market. (And get mortgage quotes etc, so you know how much you can afford to pay for a new flat.) Maybe you can then tentatively start viewing new flats.
• Once you have accepted an offer on your current flat, you can start viewing new flats more seriously, and make offers.

At the moment, the EA and developer think that it's not worth their time and effort to show you the new flat, because your current flat isn't even on the market yet.

Sistergold

No you can not sell your flat first how about if you can not get another place? Sounds like they are just creating their own rules as they go along. I remember when I was searching for a house one particular estate agents were impossible to deal with. The truth is if you found a property through such an estate agent they will disappoint you last minute! 

[Deleted User]

Its a bit mean tbh not even letting you view the blooming flat ! If you liked them, that could be the catalyst for you putting yours on the market, and once you have an offer on your flat, then you could move to the serious stage of proceeding to offer on one of the two beds. 

Not even letting you look is a rather poor business model in my opinion, Covid excuse or not. 

Ive no words of wisdom that dont include swear words I’m afraid

[Deleted User]

More than half the agents around my area are only doing face to face viewings for proceedable viewers.  People not in a position to make an offer on the property are offered a video or virtual viewing.    

Seems fair enough in this climate.

Now some will bend the rules a bit as they know that if a local person hasnt got their home on the market then they have a chance at winning the business and listing their home as well.   

They should perhaps offer a virtual viewing but otherwise its just the way some businesses are choosing to operate and remain 'covid secure' or whatever the government phrase is

kinger101

I can understand it.  You're not presently a proceedable buyer.  The current situation means many businesses have scaled back activities.  They have to priortize.

Jlawson118

AdrianC said:

Jlawson118 said:

So I've currently got a ground floor, 1 bedroom apartment
...
I was considering a part exchange if available

I wonder why they might not be keen on PXd flats in the current market... How big's your block, and what's the cladding/EWS1 situation?

Would they be trying to sell it in competition to their own new-build 1beds...?

if not, turning my current property into a Buy To Let

You've only got £18k equity in the property. If the value is static from purchase (unlikely, especially if it was newbuild at the time), that's >80% LtV. So are you hoping for open-ended CtL on your existing mortgage? Or do you have substantial savings to increase your equity to 75% max LtV for a BtL mortgage, while simultaneously raising 15% equity for an 85% max LtV on your purchase? 

Do the maths on starting such a highly-leveraged letting business make even the vaguest sense, even before you consider the +3% SDLT and the mortgage interest tax situation? 

or putting on the market.

How long will it take to sell...?

The estate agent hasn’t even asked me a single question in regards to my current situation. All I’ve stated is I have a flat that I’d like to put on the market. They’ve not even asked me how many bedrooms, the value etc. My estimated price of the property in 2020 is £105k - £120k. 

It’s only a small 3 story apartment block, 12 apartments in total, no cladding it’s all brick. 

In terms of the BTL, you’re more than likely correct. I have some extra away in an Stocks & Shares ISA but not enough to make up the relevant LTV. 

My overall aim with the property two years ago was to work towards overpaying the mortgage and in 5 - 10 years consider a BTL. But circumstances have changed since then as well as the yearly ground rent and service charges are getting extortionate. 

 

I’m not sure how long the property would take to sell. Most other apartments in the building are rented out. When these go up for let, there seems to be somebody in within a week or two. The odd one or two I’ve seen up for sale tend to have taken a fair few months. One of my neighbours told me people in this particular area don’t see any benefits in buying apartments. 

Jlawson118

Densol said:

Its a bit mean tbh not even letting you view the blooming flat ! If you liked them, that could be the catalyst for you putting yours on the market, and once you have an offer on your flat, then you could move to the serious stage of proceeding to offer on one of the two beds. 

Not even letting you look is a rather poor business model in my opinion, Covid excuse or not. 

Ive no words of wisdom that dont include swear words I’m afraid

My thoughts exactly! Though they haven’t even mentioned anything related to Covid. 

I could understand if there was a middle ground, IE, my house on the market but not necessarily sold yet. But I wouldn’t want to put the wheels in motion for a property until I knew it was 100% definitely mine. 

I wouldn’t want to sell something to be told last minute things weren’t going to happen