Non standard way of buying a house?

tostaky

Hello,
We are in London, excuse the house prices!! We have been renting a house for 5 years. We were attracted by this house because it was large, had a huge garden and was very well located. Because it was a bit run-down, we were able to afford the rent (still quite high).
We are looking to buy a house and our budget is about £1.1. We have not found anything yet. Now the landlord of the house we rent has lost her husband and she wants to sell the house (because there will be too much work to be done to modernise it). Zoopla estimates the house to value between £1.4 and £1.7. (It has not been valued yet by an estate agent).
We can't magic £300,000. Maybe we could stretch to £1.2 to a maximum (but mortgage repayment would be much higher than the rent we pay now, making it harder to save money to modernise the house).
If we made an offer, then the landlord would not have to pay estate agents fees but that's minimal i suppose (£25-30K max).
Are there any schemes where for example we could buy the house for £1.1 and then commit to give a reduced rent to the landlord anyway until she dies or for a set numbers of years? (I am thinking about "viagers" in France). Has anyone seen something like this? or perhaps another clever way of bridging the gap?

hazyjo

Please ignore Zoopla valuations. They could be miles out. You need an EA or independent valuer. Zoopla is just an average of similar local properties. There are way too many things it won't take into account.

I had it overvalue by over £150k (on a house up at 450k-odd) and undervalue by around 100k on a house I was selling around 520k.

PollyWollyDoodle

It is possible, if your landlady agreed to it, to buy the house at the price you could afford and then pay the balance off like a loan. However she would need to have a charge on the property to secure that debt, effectively a second mortgage. If you are already borrowing the maximum amount that you can afford, it’s unlikely your mortgagee will be happy about this and you would need their consent. And you’d have to be able to find those payments on top of your mortgage every month. 

Sorry to sound harsh but it doesn’t sound as if you can afford this property - unless as hazyjo says it’s worth less than you estimate. 

stevenbecca

so you can't afford to pay 1.2 but can afford 1.1plus rent? seems a bit backwards if you ask me, just offer 1.1 for an easy simple transaction all round, also play on the fact you've paid xamount in rent each month. 

FaceHead

Ring her up, offer 1.1m. If she takes it, excellent, if she doesn't you've lost nothing. If she's sentimentally attached to the house, you've got emotions you can pull on to get yourself a deal. 

From her point of view shifting you, marketing etc will be significant hassle and months or even years depending on your tenancy situation, so your offer is worth some kind of discount against others. 

If the offer is accepted you should value the house, or at least your bank will. 

AdrianC

tostaky said:

We are in London, excuse the house prices!! We have been renting a house for 5 years. We were attracted by this house because it was large, had a huge garden and was very well located. Because it was a bit run-down, we were able to afford the rent (still quite high).
We are looking to buy a house and our budget is about £1.1. We have not found anything yet. Now the landlord of the house we rent has lost her husband and she wants to sell the house (because there will be too much work to be done to modernise it). Zoopla estimates the house to value between £1.4 and £1.7. (It has not been valued yet by an estate agent).
We can't magic £300,000. Maybe we could stretch to £1.2 to a maximum (but mortgage repayment would be much higher than the rent we pay now, making it harder to save money to modernise the house).
If we made an offer, then the landlord would not have to pay estate agents fees but that's minimal i suppose (£25-30K max).
Are there any schemes where for example we could buy the house for £1.1 and then commit to give a reduced rent to the landlord anyway until she dies or for a set numbers of years? (I am thinking about "viagers" in France). Has anyone seen something like this? or perhaps another clever way of bridging the gap?

No, there's nothing really along those lines. Shared ownership is done by housing associations, but there's not really anything on a private basis.

You would find it almost impossible to get a mortgage lender to agree to anything you drew up between you.

By "£1.1", I assume you mean £1.1 million? If you can't afford what you want at that end of the market, there are plenty of perfectly good properties at lower price points...

tostaky

     it was worth asking.... Thank you all for your feedback. 

we will make an offer (she has no children of her own, so maybe....) 
she has organised a valuation tomorrow, we’ll see what the estate agent says... 

Tiglet2

Please update the thread and let us know how you get on!

tostaky

The house will be put on the market at £1.6k but with a hope of achieving £1.5k
  

AdrianC

tostaky said:

The house will be put on the market at £1.6k but with a hope of achieving £1.5k
  

OK, we've gone from £1.10 to £1,500...

I think you must mean million...

pinkteapot

tostaky said:

The house will be put on the market at £1.6k but with a hope of achieving £1.5k
  

Tell her I'll take it for £1.6k.