Vendor won't negotiate following survey problems

mrcow

You state that you've spent £2k on this purchase already....I was wondering what all this money was for and how far you've got into the purchase process (as a survey would only have cost several hundred).

If it were me, I'd be going back to the estate agent asking to see what else they've got on the market and ask for viewings, that way it will give you an idea if what you are being to expected to pay is fair (somethimes it's best to take a step back, buying a house can be emotional, but you have to try and keep it as rational as possible)

If you really are standing to lose £2k on this purchase, then maybe it would be worth looking for another property on the market with which you'd be able to negotiate a discount big enough to cover your losses on the first house?

On the flip side, another thing to consider is the quality of your quotes......it sounds like a lot of work and prices can vary greatly between companies? Would you be able to get the work done any cheaper do you think?

pandas66

I'd be inclined to walk away as you stated the original asking price was 290,000 and you wanted it at 270,000 and negotiated to 282,000, she already knows your negotiating skills and her being an ex estate agent she won't budge. I wouldn't be willing to shell out the extra 7500 at all, not even half. As it stands the one down the road looks far more attractive. End of terrace, garden. I'd be gone. You'll have to rent for longer too as you state the work needs doing before you move in and buildings have a nasty habit of needing more when work is ongoing. I've watched all the 'do-it-up and sell-it-quick' programmes on tv and they never show building works coming in under budget or hassle free.

DesG

Lemoncurd wrote:

I faxed a letter clearly stating why we felt the price drop was justified and provided copies of the reports when we first approached them with this. The agent says that the vendor refuses to look at them because she will not drop her price. I've told the agent that we would be happy to proceed at £280,000 and then casually enquired as to whether there has been much interest in the property next door (there hasn't despite it being on the market for 6 months + now) just to get them thinking.

Now we've started tryign to renegotiate I'm just feeling a bit proud and stubborn and also a bit concerned that we'd end up spending a lot more to put this house right.

If the vendor will not drop her price (even tho they _need_ to sell) I can't help thinking they are just playing hardball, it sounds like they know how to.

None of us can really tell you what to do, only give you options, and tell you what we would do

I think an appointment to view the house next door is a must tho, even if you have been to view before! 6 months on the market means plenty of negotiating power. The information will be passed back to the vendor of the first house.

In my current house, I offered the asking price, even though I thought it was a bit high, but I wanted/needed it. The vendor didn't accept the offer, as the house was only on the market a few weeks, and they thought they might get more. I was annoyed to say the least. Rang the EA back told them I wasn't happy and asked to make an appointment to see another house in the same street, one hour later my offer was accepted.

As to your last comment, you are not being proud and stubborn, you are being very sensible and reasonable in my opinion. (I would have told them to drop by 7.5k or I would pull out )

Cheers, Des.

nelly_2

Arange to see the house next door and when you get there just knock on the first house with a copy of the report and say your just looking at next door but heres why we offered even lower for yours, that way they'll see their report and know your looking elsewhere worse still for them... next door

eurows

Why are you running around after the vendor. Things have changed. There are lots of property out there. You shoulkd be offering no more than 90%.

WALK AWAY NOW.

Lemoncurd

Poppy9 wrote:

If he is the surveyor who's reports are we talking about. Who did what survey?

The survey highlighted a lot of issues which we were already aware of and also said that the garage roof needed replacing, the main roof should be checked and that an electrical survey was recommended. Quotes for the roof work came in at around £2000 in total which alone we would have just accepted.

The problem report was the electrical inspection, it was quite horrifying to read. They listed 26 points which needed rectifying - 19 were urgent for safety reasons. The reason it is like this is because of bad DIY (at least some done by the current owner). I have discussed this report with a number of electricians and all agree that the most cost effective option is to have the entire electrical installation replaced and have given varying estimates between £4000 - £7000, however will not quote formally until we specify our exact requirements. As we would benefit from this and would not be replacing like for like, this is partly why we didn't try asking for the full amount off.

The rest of the work needed involves putting right a lot of other bad or unfinished DIY done by the current owner, replacing two bathrooms and possibly the cloakroom (they have fitted the toilet in such a way that you can't open the door ). Our estimates actually only properly account for buying the fittings and materials, other than the electrical and roof work the only labour we have accounted for is the replumbing and some retiling.

mrcow wrote:

You state that you've spent £2k on this purchase already....I was wondering what all this money was for and how far you've got into the purchase process (as a survey would only have cost several hundred).

We're practically ready to exchange (just waiting on stuff from vendors solicitor). We have paid/will pay £325 for the survey (should actually have been over £500 but think they made a mistake - shhhh) £280 for elec report, £90 for gas checks, £675 solicitor, approx £400 for searches and other costs. The solicitor might reduce her fees if we don't complete and there might be a couple of disbursements that will no longer be payable but that would prob only reduce it by a couple of hundred at the most.

We've looked at the next door property a few times and don't see it as a viable option for a number of reasons. I still mentioned it to the estate agent hoping that she would pass the fact we expressed an interest onto our vendor. We also talked with the vendor of that one for a long time and he is in no hurry to move and is sticking out for his price.

To everyone who said they wouldn't offer more than 90% on a place - I know where you're coming from, I always used to think along those lines but at the end of the day weighing up everything in this case it just didn't seem realistic.

mrcow

I know that £22k is a lot of money for house repairs, and I suppose your final decision is going to depend on whether you can ultimately afford it, warts and all, but with the exception of the electrical work, none of this work sounds as if it is immediately required (just trying to sound positive) so you wouldn't have to fork out for all of it straight away?

All you have to do I guess is take a look at the house in it's entirity and come to a decision as to whether it's worth the money to YOU. Think about what the alternatives are in the area for the money that you are looking at, and whether all of the extra work and money for the repairs are going to be worth it to you.

Just as a flipside, as I know a lot of people here are saying to walk away, I bought my current house three years ago, and it honestly was a stinking pit (and I mean PIT!). We've spend thousands on getting rid of damp, replacing floors, replacing all the windows, a new kitchen, redecorating the entire house and the smell took months to clear (urgh!). It's been worth every penny, every argument, all the unheaval. If I'd understood what I was letting myself in for when we bought it, I would have probably tried to knock a few thousand off my asking price......but it's our home now, and I don't regret a penny of it.

Maybe the vendor is trying to play 'hardball' and I can understand that it would get your back up to say the least, but don't let your pride dictate an outcome to such an important decision.

SilverSurfer_4

I suggest you read a book about negotiating to clarify your thoughts.

Before starting any negotiation you must decide what is the point at which you will walk away. When selling decide the lowest price acceptable : when buying the highest price acceptable. You can also decide how much per month to change these limits if delay is costly (difference between rent and mortgage?) or the market changing rapidly.

Your starting point should be how much the property will be worth to you once it has been put in good condition. What others pay for similar proerties influences a surveyors valuation. It does not affect the value of a specific house to you. I assume you are not a property speculator who must consider how much he can sell it for.

The asking price and the vendors financial problems do not affect your calculation. You have to consider what aspects of a house you consider important. This includes the discomfort of existing in a house while it is being renovated.

You offered 272K assuming you would spend 15K. This tells a negotiator you thought the house in good condition was worth MORE than 287K because you NEVER start by offering the upper limit. Now you are signalling it is worth 268.5+22K more, that is 290.5K. You have not made this a final offer. An estate agent is a skilled negotiator so she will have read your signals. She will have already decided her lower limit. You might already be above her lower limit. Your offer is not time limited so she does not have to accept immediately. She can wait to see if she can squeeze a little more out of you.

Do your sums based on how much you like the place. She may be under time pressure from her family. Create more time pressure. Make her a final offer with a very short time limit. "If my offer is not accepted by ~~~~ then it is withdrawn." Do not give her time to negotiate with any other potential purchaser. If you can prove that you already have the required finance without waiting to sell a property then this could influence her decision. At 4% net of tax she will only get just under £1000 a month interest on the 290K you give her. Your suggested reduction is equivalent to her waiting an additional 4 months for a purchaser.

If your final offer is above her lower limit she will accept. Otherwise she will walk away. You will then be better equipped to negotiate for the next house.
Best wishes.

TheDink

My boyfriend and I were in a similar position a few weeks ago. We had estimated the house we were buying needed £10,000 spending on it (installing gas, a bit of replastering, general maintenance), but we when got the results of the survey this highlighted at least another £5000 (probably more) of work that was needed (mainly to resolve damp problems). The vendor was not willing to negotiate at all on the price so we walked away immediately.

This house has been on the market since before Christmas and this is the second sale that has fallen through.

We are now much happier, having found a lovely house that we can move straight into. It seems like all the problems came up for a reason!

Buying a home is an emotional issue, but you do need to think about it too. It's not just the money that needs to be spent on the place, it's all the disruption and inconvenience you will be putting yourself through - you are not just negotiating based on the "value" of the house once the work is done.

Pal

There is a lesson to be learned here: Always get the survey(s) done before you do anything else, particularly legal work.

I would have no problem at all walking away from the house where the survey had revealed work requirements that I was not willing to pay for. That is what a survey is for. It is not "wasted money" at all, but money wisely spent to avoid making a bad financial decision.

In your specific situation I would walk away. Firstly because I am a bit pig-headed, secondly because the market has changed, and thirdly because I like the idea of annoying an ex-estate agent who thinks they are being clever.

I would also simply put everything on hold (so no-one does any more work) and start house hunting with other agents while leaving this vendor waiting. In a few weeks time, simply reduce your offer. Leave it on the table and see what happens. If she is keen to move she is more likely to accept your offer the longer you leave it.
As a prior poster pointed out, chances are that you will find a much better house somewhere else if you look around again.