Is an offer 20% below asking price unrealistic?

CSI_Yorkshire

mashmash90 said:

CSI_Yorkshire said:

You can if you like, nobody is stopping you.

"Full cash buyer" isn't necessarily the superpower some people seem to think it is though.

A full cash buyer is the only way they will sell a 55 year lease flat though, no mortgage company will go near that 

Correct - but this is not the only factor determining the price.

Cash buyer =/= automatic huge discount.

The rest of the thread is dealing well with what discount might or might not be plausible.

MultiFuelBurner

So how much is a 20% reduction in £'s?

NameUnavailable

In my experience most agents DON'T seem to take lease length into account with their valuations although it's crucial as you are indeed only buying a lease. They value the property.

What is the going rate for the same flat with a long lease? What (roughly) will it cost you to extend? Bearing in mind you won't be able to extend until you have lived there for 2 years. There's a margin for costs/increases and hassle factor to take into account as well.

Offer what you think it's worth to you. The worst is that they say no.

SandyN21

RelievedSheff said:

SandyN21 said:

RelievedSheff said:

SandyN21 said:

MultiFuelBurner said:

How does the current price stack up against others for sale with "mortgageable leases"?

Another flat in the development on the floor above (2nd) but has an en suite and needs no work with a 143 year lease is on the market for £15K more (but price has been reduced twice in the year). 

I've also found out that a section 20 has been issued to the residence for £4K which is for work to be done to the underground car park and further work is to be done early next year to resurfacing the above ground parking area but that hasn't been costed. 

I'm in a dilemma as I walk past this small development nearly every day and it's perfect for me. 

The other flat sounds like a better prospect. Have you considered buying that one?

No... because it's on the 2nd floor and I'm only after a 1st floor flat - that's why it's taking me so long to find my forever home. 

What's the real difference between a 2nd floor and a 1st floor flat?

You are going to have to go up stairs to get the either!!

I live on the first floor now and see how my neighbours who are in their late 80s struggle to get to their 2nd floor flats.  As I'm in my 60s and quite fit as I do daily 5 mile walks and this is going to be my 'forever home'...I still have to consider what my health will be like in the future - and don't say why not consider a bungalow as I prefer the security of a self-contained 1st floor flat with a communial entrance door with secure intercom systems. 

SandyN21

MultiFuelBurner said:

So how much is a 20% reduction in £'s?

Roughly £62K

MultiFuelBurner

OK so it sounds like this property is a good fit for you. About 15k less than similar properties but with a potential lease extension cost of 58k.

I think you mentioned.section 20 works of 4k

So your immediate costs this year are £62k but take away the £15k reduction and a reasonable offer with full explanation as to why may be £47k below asking.

Of course this may be a very bitter pill to swallow for the seller. Expect a strong reaction before any reality kicks in.

london21

Can try but have to be realistic.

What is the going price and sold prices etc. 

youth_leader

I'm amazed the cost is so high - perhaps the 'informal' route could be cheaper?

I felt a bit jittery about the length of my 86 year old aunt's lease as I have offered to support her financially if she does want to go to assisted living, prior to her selling - she thinks she has 99 years. 

I'm sorry this vendor didn't have anyone to help her and her only asset has devalued so, it's sad.

NameUnavailable

Tiglet2 said:

It sounds as though there may be room for negotiation, but 20% is likely to be a considerable sum and may well upset the vendor so much that she refuses to negotiate at all.

If this flat is as perfect for you as you have said, then make an offer which reflects the cost of a lease extension (however, did the EA value it knowing how short the lease was?) and part of the Section 20 costs (bear in mind you will benefit from the works, your seller won't), but make sure you can back up your offer with facts and figures (not plucked out of thin air). 

If the other flat is £15K more then clearly the agent didn't take lease length into account as the extension is going to cost a lot lot more than £15K!

NameUnavailable

SandyN21 said:

youth_leader said:

Any use to you in your calculations? Lease extension calculator for flats - The Leasehold Advisory Service (lease-advice.org)

Thanks - have used this with a calculation of 53 years as I understand I have to live in it for 2 years before I can extend (someone please correct me if this info is wrong). 

The current ground rent for the property is £55 a year ? Correct? (or have you typed in the current lease length?!)