Renegotiating price due to down-valuation

themilkman

Sarah1Mitty2 said:

themilkman said:

caprikid1 said:

Why is he now selling ? Is this a forever house ? How much have you invested into the purchase ?

He may not be in a position to drop.

He's selling because he's already completed on another house - bought both with cash - he is wealthy.

Invested around £3K so far probably, survey, solicitors, searches etc. I'm more worried about paying over the odds than the £3K!

Are you sure he isn`t just "wealthy" on paper, i.e highly leveraged and depending on property prices from 2 years ago? Buying in November and trying to sell now doesn`t sound like smart wealthy money to me (that money exited during the stamp duty holiday window IMO) more like a flipper who has just misread the market and interest rates completely.

Yes, actual wealth. He's in a household name band, worth £20m+. Not smart wealthy though, you're right 😂

Anyway, we've asked if he will renegotiate, and it sounds unlikely but is letting us know tomorrow. If he won't then we'll need to pull out. I've spoken to other estate agents today and they said we'd be absolutely mad to buy at the price we had agreed as it simply isn't worth anywhere near that. Oh well!

TheJP

themilkman said:

Sarah1Mitty2 said:

themilkman said:

caprikid1 said:

Why is he now selling ? Is this a forever house ? How much have you invested into the purchase ?

He may not be in a position to drop.

He's selling because he's already completed on another house - bought both with cash - he is wealthy.

Invested around £3K so far probably, survey, solicitors, searches etc. I'm more worried about paying over the odds than the £3K!

Are you sure he isn`t just "wealthy" on paper, i.e highly leveraged and depending on property prices from 2 years ago? Buying in November and trying to sell now doesn`t sound like smart wealthy money to me (that money exited during the stamp duty holiday window IMO) more like a flipper who has just misread the market and interest rates completely.

Yes, actual wealth. He's in a household name band, worth £20m+. Not smart wealthy though, you're right 😂

Anyway, we've asked if he will renegotiate, and it sounds unlikely but is letting us know tomorrow. If he won't then we'll need to pull out. I've spoken to other estate agents today and they said we'd be absolutely mad to buy at the price we had agreed as it simply isn't worth anywhere near that. Oh well!

Of course other EAs will tell you its a mistake, they want you to buy a property they are marketing.

Aare you reliant on bank funds for the property? Could you afford inc mortgage? What if you invest £3k in the next house offer and the lender doesn't agree and then the next and the next. Look at houses that are comparable to this house to help better understand if it is competitive, don't listen to crashy (sarah mitty) my house has gone up in value according to my lenders valuation by £100k since 2021.

lookstraightahead

Just offer what you want to pay, and if the vendor doesn't accept, walk away 

[Deleted User]

You are in a strong position because prices are falling. The longer the seller leaves it, the more it's going to fall.

MultiFuelBurner

themilkman said:

Sarah1Mitty2 said:

themilkman said:

caprikid1 said:

Why is he now selling ? Is this a forever house ? How much have you invested into the purchase ?

He may not be in a position to drop.

He's selling because he's already completed on another house - bought both with cash - he is wealthy.

Invested around £3K so far probably, survey, solicitors, searches etc. I'm more worried about paying over the odds than the £3K!

Are you sure he isn`t just "wealthy" on paper, i.e highly leveraged and depending on property prices from 2 years ago? Buying in November and trying to sell now doesn`t sound like smart wealthy money to me (that money exited during the stamp duty holiday window IMO) more like a flipper who has just misread the market and interest rates completely.

Yes, actual wealth. He's in a household name band, worth £20m+. Not smart wealthy though, you're right 😂

Anyway, we've asked if he will renegotiate, and it sounds unlikely but is letting us know tomorrow. If he won't then we'll need to pull out. I've spoken to other estate agents today and they said we'd be absolutely mad to buy at the price we had agreed as it simply isn't worth anywhere near that. Oh well!

I wanna say Cillit Bang lol

jonnydeppiwish!

Market has changed, prices are changing, and if the bank is saying no, then in your position I’d be going back with an offer of the banks valuation and then meet at the more Comfortable 5% over. If it’s what you want though..

RelievedSheff

Are there any other properties on the market that you would be as happy living in?

Sometimes a home purchase isn't just abouts its monetary value. 

dwsjarcmcd

I agree with the other EA in that I think you'd be mad to pay the original price given the survey, which will also impact the amount the lender will lend you. 

To put it starkly, if you're currently paying £250k for the house, then you're effectively giving away £40,000. It could take years to recoup this which may impact your ability to move in the future as you could still be in negative equity.

Personally, I'd run away if the vendor doesn't agree to renegotiate rather than put myself and family in such a negative position.

themilkman

RelievedSheff said:

Are there any other properties on the market that you would be as happy living in?

Sometimes a home purchase isn't just abouts its monetary value. 

Yes, viewing arranged for tomorrow. House is 25% bigger and 15% cheaper, within a mile - proves the bank's point on the valuation of current offered house, but not enough to make the vendor understand the market 

themilkman

dwsjarcmcd said:

I agree with the other EA in that I think you'd be mad to pay the original price given the survey, which will also impact the amount the lender will lend you. 

To put it starkly, if you're currently paying £250k for the house, then you're effectively giving away £40,000. It could take years to recoup this which may impact your ability to move in the future as you could still be in negative equity.

Personally, I'd run away if the vendor doesn't agree to renegotiate rather than put myself and family in such a negative position.

I completely agree. When the EA asked the vendor whether he would be willing to negotiate though, his two rebuttals were:
1) "well if he's planning to live it in a few years then the value will go up so he won't have lost any money"
2) "even at the current selling price I'll still be out of pocket because I paid stamp duty on it"