Increase in house value - what would you do?

MeandO

I first marketed my house in March, a week before COVID hit. Obviously, selling then proved to be tricky and I took it off the market for a while, but then accepted an offer in August. It has taken me a long time to find somewhere to move to as there has not been a lot on the market near me, but I found something that will suit us a few weeks ago and had an offer accepted. Surveys, searches etc are paid for and going through. My buyers have been incredibly patient throughout and continued with their sale and are now living with family so there is no chain. They have now stated they want a very quick completion which I am happy to go along with.

However, now they know I have paid out fees on the ongoing purchase, they seem to be getting a bit tricky to deal with. They went quiet for a while and I had to repeatedly ask whether they were proceeding with the purchase before I shelled out on fees etc, then have now booked a second survey after having a homebuyers survey back in August. I’m told this is a ‘snagging’ survey (this house is less than 2 years old) but have queried as to why they’ve left it so late if they are chasing completion within a few weeks. I have also made it clear to the agent that I will not be reducing the price if they find anything they are unhappy with in the survey.

My issue is, that the market has changed drastically in this area Since I accepted the offer and two houses of the exact same style as mine in this estate have since gone on the market and sold for between £15k and £30k more than I have sold mine for. The developer is now selling this house type for £45k more than mine is sold for, it is the last plot they have in that style as the development is almost finished. Mine is also in a better position on the estate than the two that have sold, although I have not done much with the garden other than turf and some shrubs, unlike one which had decking etc. 

With regards to the onward purchase, I could see we would be happy there, although is much smaller than I would have liked, but it’s all we need and it will mean I’m considerably better off financially as is £70k cheaper than my current house which is a massive plus as my job is never that secure.

I guess I’m really after opinions - would you sell for this price now or would you pull out and remarket now or early next year at the increased market value? I wonder if more properties will be on the market then to choose from too, but I would feel incredibly guilty as the buyers have been extremely patient. I don’t really know what to do, some are telling me I’m mad to sell it pe, others are saying just do it as I’ll be much better off financially.  Opinions would be very welcome!

Jeepers_Creepers

What sort of time pressure is on you for the new house? Ie, if you were to remarket your current house, could that scupper your purchase plans?

I'm not at all suggesting you do do that, but it's a good way to put pressure on your buyer who don't seem to realise how lucky they are.

At the very least, I think your should tell your solicitor - and your EA, because they are often the ones who pile on the pressure - to inform your buyer 'No more procrastination - you have until X to exchange, or you will increase the asking price by £Xk and/or instruct your EA to remarket the property'. 

Given what you have told us, that is a fair thing to say, I believe. But you must be prepared to carry it through; hollow threats are unethical and just wreck trust. If the boot were on t'other foot - a falling market and you dragging your feet, there is every chance a buyer would try lobbing off some cash.

Your other options are for you and your conscience... Eg: demand more money (which it seems you could justify), or simply pull out and remarket. 

MeandO

Thank you jeepers_creepers, it’s good to get an outside perspective when you’re in the thick of it. 

There is very little time pressure for the new house. There is no forward chain either so it is a good position to be in. If I remarketed I would likely lose the onward purchase but I wouldn’t be devastated, disappointed yes, but it’s not the end of the world. I’m sure something else would come up eventually. This isn’t a dream house purchase scenario, it’s a practical move to be in a better financial position and also to be settled nearer my child’s school and closer to the area we used to live in and out of this house and estate which we really don’t like. I don’t HAVE to sell though but it has been hard finding something acceptable to buy, there have been a lot of wrecks on the market here and not much else.

The agent wasn’t amused with my discussion about remarketing at a higher price and are keen for the sale to progress, I think they just want their commission as it’s been 8 months already, they haven’t been the best with communication though so I would possibly market with a different agent anyway. My solicitor is just telling me to do what’s right for me and pretty much s0d the rest of them!
I do just want out of this house though for various reasons which doesn’t help the situation, we’ve never been happy here. 

RelievedSheff

If you just want out of the house then just carry on with the sale that you have.

Angela_D_3

Let’s say you get another £15,000 are you just going to pass that money up the chain to the next person ?  Unless it’s going to stay in your pocket it makes little difference.  

I do think your buyers need a rocket up them though.  

MeandO

Angela_D_3 said:

Let’s say you get another £15,000 are you just going to pass that money up the chain to the next person ?  Unless it’s going to stay in your pocket it makes little difference.  

I do think your buyers need a rocket up them though.  

It would probably go towards lowering my mortgage further Angela_D_3 as I've been overpaying my current mortgage in order to try and pay it off as quickly as possible and I am buying much cheaper to downsize my mortgage. Or it would allow me a bit more choice in houses to purchase if the one I've offered on does fall through. I've had difficulty finding something that doesn't need a lot of work doing to it as I accepted what is now a low offer on mine and then prices subsequently went up where I'm buying so I was priced out of several properties I previously could have afforded. I'm not talking anything grand either, I'm buying a small 3 bed semi. The whole process has just been terrible timing unfortunately!

eddddy

MeandO said:

I’m told this is a ‘snagging’ survey (this house is less than 2 years old) but have queried as to why they’ve left it so late if they are chasing completion within a few weeks. I have also made it clear to the agent that I will not be reducing the price if they find anything they are unhappy with in the survey.

FWIW, snagging survey results shouldn't be a reason to reduce their offer.

It will be a list of things that they need to tell the builder to repair, as part of the 2 year warranty. So the builder would be covering the cost, not your buyer.

TBH, they could arrange this after completion (as long as it's within 2 years of your original purchase date.)

tigerlily74

As you have a buyer and a house you want to buy I would just crack on and get it done. You have a solid argument for not accepting a drop in price which I would stick with if I were you, but only remarked if your buyers drop our or become unreasonable.

Scotbot

You can put the extra money towards the stamp duty that will become liable and the double set of agents fees. (Check your contract but if you try to remarket you may be liable to pay the fee For the failed transaction ) Personally I would carry on with the sale, it is likely there will be fewer properties on the market next year as the SDLT holiday will almost certainly end.

MeandO

Scotbot said:

You can put the extra money towards the stamp duty that will become liable and the double set of agents fees. (Check your contract but if you try to remarket you may be liable to pay the fee For the failed transaction ) Personally I would carry on with the sale, it is likely there will be fewer properties on the market next year as the SDLT holiday will almost certainly end.

Thanks Scotbot, there is no stamp duty to pay as the onward purchase is well under the £180K threshold.
Contract already checked, there are no fees payable for pulling out of the sale.

MeandO

eddddy said:

MeandO said:

I’m told this is a ‘snagging’ survey (this house is less than 2 years old) but have queried as to why they’ve left it so late if they are chasing completion within a few weeks. I have also made it clear to the agent that I will not be reducing the price if they find anything they are unhappy with in the survey.

FWIW, snagging survey results shouldn't be a reason to reduce their offer.

It will be a list of things that they need to tell the builder to repair, as part of the 2 year warranty. So the builder would be covering the cost, not your buyer.

TBH, they could arrange this after completion (as long as it's within 2 years of your original purchase date.)

Thanks, eddddy, yes, my thoughts exactly. They need to do this after the sale not before but are insistent, which is why I'm thinking they're trying to use it as a bargaining tool.