Cash buyers ruining it for everyone

o_johnston

babyblade41 said:

Just thank your lucky stars that for that sort of price in my neck of the woods it wouldn't buy a shed ... 

I've paid more for a house because it was going to be my home for a couple of years.. it's what it's worth to you and how much you really want it... a few grand over the odds isn't going to make much difference 

Believe me, we're very lucky to live in Belfast compared to the prices in England. My partner is English and we basically can't afford anything in England south of Manchester

duggan1

geoave1 said:

My understanding of a cash buyer is actually having the money in the bank, no mortgage involved. 

Doesn't necessarily mean cash in the bank, it just means no mortgage so the 'cash' might come from the sale of another property. Largely depends on the estate agent I imagine.

Caramac

Basically if it’s your dream home go for it. Yes losing the £6k bonus is a pain but better in a house you are happy in without the additional £6k than setting for second best.

greatcrested

Different people (and even different agents) define 'cash buyers' differently

* no property to sell but need mortgage

* don't need mortgage but have a propery to sell

* don't need mortgage, no property to sell, cash in the bank ready to go

spoovy

If you think the £250k cut off is too low in Belfast imagine how people feel looking to buy in the south east!  A new build block near me (Staines -- not a posh area) has flats starting at £400k for a tiny -- and I mean tiny -- one bed shoe box, with views of the main road and dry cleaners.

WiseOwl00

I can see where OP is coming from. Cash buyers don't need to worry about passing the valuation part of a mortgage application. They can literally bid whatever the house is worth to them personally, as long as they have that amount in cash. Whereas someone with a mortgage is restricted to what the bank is willing to lend. Buyers with mortgages are more restricted with their offers. 

I've heard of this happening a lot actually, not sure if this is just a normal part of house buying though. We originally put an offer in on a house at the lower end of the asking price and a cash-buyer went straight in at the top. We didn't think it was worth the top end, so offered in the middle. They ended up accepting our offer because we were FTBs with no chain, and they wanted to sell fast (or so they said, they ended up completely wasting our time for 3 months and then pulling out). I've heard of cash buyers going way above the asking price recently from a few people I know as well. Luckily that didn't happen with our current house. We seemed to have had the edge due to being FTBs with no chain. 

o_johnston

spoovy said:

If you think the £250k cut off is too low in Belfast imagine how people feel looking to buy in the south east!  A new build block near me (Staines -- not a posh area) has flats starting at £400k for a tiny -- and I mean tiny -- one bed shoe box, with views of the main road and dry cleaners.

It's crazy how pricey the south of England is. We would love to move to be closer to my partner's family and friends but the same money that buys a semi detached house in belfast buys a studio flat in a small town in England

I had thought of maybe buying in Leeds or somewhere on the HS2 route, then selling when / if it's built for profit and move south.

hazyjo

WiseOwl00 said:

I can see where OP is coming from. Cash buyers don't need to worry about passing the valuation part of a mortgage application. They can literally bid whatever the house is worth to them personally, as long as they have that amount in cash. Whereas someone with a mortgage is restricted to what the bank is willing to lend. Buyers with mortgages are more restricted with their offers. 

Someone with a mortgage can pay over valuation. Only a problem if they're borrowing the absolute max without any spare cash at all!

AskAsk

must be where you are, the estate agents are advertising the properties below market value and then it gets bid up.  from my experience, in our area, it is the other way round.  the estate agents overvalue properties so the sold price is often below the asking price.

Davesnave

WiseOwl00 said:

I can see where OP is coming from. Cash buyers don't need to worry about passing the valuation part of a mortgage application. They can literally bid whatever the house is worth to them personally, as long as they have that amount in cash. Whereas someone with a mortgage is restricted to what the bank is willing to lend. Buyers with mortgages are more restricted with their offers.

Depends what you're calling a cash buyer. Hazyjo points out that someone with plenty of equity can pay over valuation, no problem, but a true cash buyer is one who can buy outright without a lender's aid.

Such buyers are able to proceed in the limited circumstances of a property being unmortgageable. That's a tiny fraction of the market. We bought our property outright and it was cheap because it came with risks that spook lenders. That wasn't unfair, just market forces at work.