Lowering offer

apuleius

I'm in London and prices most definitely have come off in the last month. This property was first marketed in October, and as far as I am aware we are the first serious buyer. But as I said the agent/vendor have taken four weeks to agree to my most recent offer which was up 10k from the original offer. Things have changed. We could have completed in that four weeks which would have been an entirely different situation. The vendor is leaving the country (in fact she has now left) so has to sell. I do not want to overpay.

Running_Horse

apuleius wrote: »

I do not want to overpay.

Then don't.

Nicki

Did she reject your offer or just leave you hanging?

I would be inclined to go back and say that in the last 4 weeks you feel the market has had a downturn, and that you fear that interest rates are going to go up. Your calculations when you made the revised offer 4 weeks ago were that you would be pushed to the wire on mortgage payments, and that you are now concerned if rates go up you will not be able to afford the property, and that if you sell you will be in negative equity. Therefore although still interested, the maximum you are prepared to risk is x (whatever that is). You will however be in a position to move quickly. If she has already left the country, she will no doubt be worried herself about how she will continue to afford the mortgage, and probably not want to take a final decision to get tenants in if she can sell it. You should check however to make sure that you are offering more than she paid for the property herself as she won't sell it at a loss I shouldn't think.

Usually I despise gazumpers and gazunderers but I just don't think that this situation is the same, as the offer was made 4 weeks ago and either rejected or at the very least not accepted. It's only once an agreement has been reached in principle that I think the duty to act in a moral way comes into force (and I am well aware that there are plenty on here who feel there is no moral duty, but I am not one of them)

apuleius

First offer of 290k made on nov. 19 (property on market c. 3 weeks) rejected client holding out for 310 (asking price 315). told an offer in hand for 308 which was rejected. Two days later agent rings to say other buyer has bought elsewhere what is our best price go to 292K. He doesn't get in touch so a few days later I ring to find rejected (don't think the vendor was even told) and will only consider a number beginning with a 3. So offer 300k. that was on 23rd nov. After trying for three and a half weeks to get us to move up, he rings yesterday to say that the vendor will accept 300k. The whole time we keep saying that we feel that the market has changed. We are in a position to make a quick purchase, mortgage offer in place, large deposit, no chain, first time buyer etc. Vendor left the country a week a ago. I think this agent is playing games and in no way do we now four weeks in wish to pay 300k but do want to get the flat, probably at our original offer. Are we crazy?

chelseablue

apuleius wrote: »

First offer of 290k made on nov. 19 (property on market c. 3 weeks) rejected client holding out for 310 (asking price 315). told an offer in hand for 308 which was rejected. Two days later agent rings to say other buyer has bought elsewhere what is our best price go to 292K. He doesn't get in touch so a few days later I ring to find rejected (don't think the vendor was even told) and will only consider a number beginning with a 3. So offer 300k. that was on 23rd nov. After trying for three and a half weeks to get us to move up, he rings yesterday to say that the vendor will accept 300k. The whole time we keep saying that we feel that the market has changed. We are in a position to make a quick purchase, mortgage offer in place, large deposit, no chain, first time buyer etc. Vendor left the country a week a ago. I think this agent is playing games and in no way do we now four weeks in wish to pay 300k but do want to get the flat, probably at our original offer. Are we crazy?

£300K for a flat? I would say that is crazy! I think the stamp duty alone is £9,000. But thats not your fault; its the way it is in London.

I believe prices today are unsustainable and due to come down but that is just my opnion.

Good luck

Running_Horse

chelseablue wrote: »

£300K for a flat? I would say that is crazy!

Agreed. I wouldn't buy in London even if there was a 25% reduction. All that for a couple of pokey rooms, when 30 minutes down the railway line you could get a detached house and garden for less money.

General_Mayhem

I would revert to the 292 offer if you think it is a fair price. Bear in mind that the vendor is probably also well aware of the recent price drops, and this may be why your 300k offer becomes acceptable.

You now have the upper hand: use it to get the best price possible, but don't expect the vendor to accept a silly offer because the market may drop in the future. Prices haven't crashed yet, as some people on this forum seem to think.

Rick62

Rightmove just produced some stats last week that London had dropped 6.8% in one month - thats about £20k on your property.

The sentiment has changed dramatically in the last few weeks, as have values and the availability and cost of mortgages.

If you reverted to your original offer that would be more than generous, if the price now is about £290k to £300k it could well be £250k within a year.

cattie

My only problem with you as a buyer wanting to drop the price after 4 weeks would be the concern that in yet another 4 weeks you'd be after another price drop & so on. For this reason I'd be inclined to reject you as a viable buyer.

How would you feel if a vendor accepted a price on a property & then 4 weeks later in a rising market came back & said he wanted more money as the value had increased? It's the same thing reversed, but nobody would praise the would be vendor for trying it on in such a way.

dolce_vita

cattie wrote: »

My only problem with you as a buyer wanting to drop the price after 4 weeks would be the concern that in yet another 4 weeks you'd be after another price drop & so on. For this reason I'd be inclined to reject you as a viable buyer.

How would you feel if a vendor accepted a price on a property & then 4 weeks later in a rising market came back & said he wanted more money as the value had increased? It's the same thing reversed, but nobody would praise the would be vendor for trying it on in such a way.

In a sort of, accidental, round about way, you have summed up the cyclical nature of the property market

Well done (although I'm sure you didn't mean it)