First time buyer bidding war advice

SpiderLegs

o_johnston said:

frogglet said:

I wouldn't have it valued till you have an agreement with the seller.

It hasn't been valued yet, but my worry is we go to 210,000 and Nationwide who our mortgage would be with, say they value it at 200,000. Then what? 

When you offered 200k were you worried about them valuing it at 190k. I suspect not.

The only questions to worry about now are
can you afford to go any higher?
how would it affect your mortgage LTV?
is the house worth it?

DayDreamerandGeneralWaster

All that matters right now is what you think the property is worth. If your max is 205k but you can 'stretch' maybe this isn't the one for you.

o_johnston

Our max offer would've been 210k but now a third bidder also first time buyer has offered 208k.
Nearby similar properties going for 230k don't look as nice. This is a 4 bedroom terraced in South Belfast and there's 3 bed on the same street going for 265. This house has also been completely refurbished in 2008 and requires very little work so that's what really makes us want it.

Just that as a first time buyer, it's hard to know when to stop or what happens with valuations being lower than the sale price.

Eilidh1970

Have you had a look at recent sold prices in the area, as some of the other ones may be ambitiously priced? 
A gap between valuation and sale price would mean that you have to pay the difference (in addition to your deposit) and run the risk of having paid too much for a house that in turn might not fetch that much in the future - this matters less if you can see yourself living there for a while. 

o_johnston

Eilidh1970 said:

Have you had a look at recent sold prices in the area, as some of the other ones may be ambitiously priced? 
A gap between valuation and sale price would mean that you have to pay the difference (in addition to your deposit) and run the risk of having paid too much for a house that in turn might not fetch that much in the future - this matters less if you can see yourself living there for a while. 

The house next door sold for 265,000 with 1 bedroom less. LPS values the property at 145,000 but inside there's very little work to do and they've refurbished etc.
My main worry about buying was always negative equity if we're stuck and want to move 

Eilidh1970

I'm not familiar with LPS (do they always value properties way below their typical market values?) but on the face of it I'd be really concerned if the given value is 145,000 and the bidding is over 200,000. Is this a typical LPS value for the area?

lookstraightahead

I would walk and refuse to get into bidding wars, and I totally get your issue re the valuation scenario - would leave a bad taste in my mouth if I had to pay higher.

But I'm not you, so you need to carefully consider your options and what is important to you. 

o_johnston

Eilidh1970 said:

I'm not familiar with LPS (do they always value properties way below their typical market values?) but on the face of it I'd be really concerned if the given value is 145,000 and the bidding is over 200,000. Is this a typical LPS value for the area?

I think they must value the house minus anything inside. The next door one that sold for 265k was valued by them at 175k. Using the same % if they value this one at 145, then the value would be 224 ish.
I don't want to go above 210, but worried it could still be cheap at that price and that we're missing out on a still great property. 

theoretica

o_johnston said:

Eilidh1970 said:

I'm not familiar with LPS (do they always value properties way below their typical market values?) but on the face of it I'd be really concerned if the given value is 145,000 and the bidding is over 200,000. Is this a typical LPS value for the area?

I think they must value the house minus anything inside. The next door one that sold for 265k was valued by them at 175k. Using the same % if they value this one at 145, then the value would be 224 ish.
I don't want to go above 210, but worried it could still be cheap at that price and that we're missing out on a still great property. 

They are the 2005 values used for tax purposes.   https://www.nidirect.gov.uk/articles/valuation-of-domestic-properties-for-rates

Greymug

o_johnston said:

I don't want to go above 210, 

There you have your answer. If you don't want to go above 210, offer 210 and if they say no you walk away and forget about it.