How to know what to offer on a house?

Cloth_of_Gold

Forget the mind games and offer what you genuinely believe it is worth and, more to the point, what you can reasonably afford. Don't offer more than you can afford because however much you like it there will be other houses you will also like and overstretching yourself is a bad idea.

I agree with the comments on how much their refurbishment has added to the value. It depends what they've done but for some improvements you don't get back what you've paid, and for an increase of £60K (over 40%)  I would expect that they had done something really substantial - not just cosmetic stuff.

ruf_ha11

I’ve found comments really helpful, thanks. I guess a lot has happened today! In terms of the changes they’ve made it’s mostly cosmetic - all new floors, kitchen, bathrooms and painting etc but nothing like walls being knocked down or any construction wise (there is a extension which is the main added value compared to others but this is 15 years old). 

I contacted to arrange a second viewing and was informed an offer had been made yesterday by people who’ve viewed since and this was rejected and they’ve made a higher one today. I don’t really know etiquette so asked and was told they offered 180k which was rejected and second is closer to 190k which the seller is ‘sitting on’. It’s definitely impacted things a bit and I was worried I was feeling too rash about the idea of putting in an offer asap due to this which I possibly wouldn’t have done as quickly. Decided to speak to a solicitor and have put in a note of interest. The solicitor seemed to think (from their response ) it was a bit strange that the seller shared this info and said they’d wait to hear back from the sellers solicitor likely tomorrow to see what they say the situation is. I’m really on the fence about it all as I really like the house but it all feels very fast. I would have preferred to have some in case money as deposit and solicitors fees will be it all - expecting to get a lump sum of money in a few months from something but things can change and don’t want to rely on thing for things might need to be done once we’ve moved in. 

We took family with us today too who pointed out a few things we hadn’t noticed like window not closing and drainage issues which possibly has lead to damp under the house which isn’t mentioned in the home survey report. Raised this with the solicitor who has said in Scotland it is rare for buyers to do their own survey as the home report is independent survey anyway so am a bit unsure on that all. However he’d said the survey is too old and would need to be redone anyway and we could just speak to the surveyor and mention the issue rather than put in our own survey as a condition. 

Thanks to anyone that reads all that! And I’d massively appreciate any advice or insight from those more experienced. I’m a tad overwhelmed and am now just going to step back a bit and think about all the practical things. Unfortunately the solicitor didn’t offer any advice on amount that would be fair to offer which is what the post was initially about! 

Cloth_of_Gold

How many houses have you looked at before you saw this one? Personally, unless there is a very good reason I wouldn't rush into it. It's a huge decision and one you will have to live with (as well as in!) for many years. As I said before, this is not the only house you will like and if you have doubts and feel rushed, that is suggesting to me that you are not ready. Even if you have looked at a lot of other properties and this one is by far the best you still need to feel comfortable about the finances, both in terms of whether it represents decent value and whether you can afford it without being too stretched.

Something else to think about is that interest rates look as if they're heading down in the next few months (of course that's not guaranteed) but if that does happen then you don't want to be locked into a higher rate now when if you'd waited a bit you'd have more money put aside and potentially lower monthly repayments. I'm not saying don't go for it but just give it a lot of thought (which clearly you are) and don't be rushed.

Albermarle

You can look at it from the Vendors point of view, assuming they are a developer of some kind.

Paid £140K - looks like they have probably spend something between £10K and £15K ( assuming it is not higher end fittings, expensive flooring etc ) if they did some of the work themselves
So lets say total cost with legal fees , money tied up for 9 months etc  £165K. So £185K gives them £20K profit.

ruf_ha11

Cloth_of_Gold said:

How many houses have you looked at before you saw this one? Personally, unless there is a very good reason I wouldn't rush into it. It's a huge decision and one you will have to live with (as well as in!) for many years. As I said before, this is not the only house you will like and if you have doubts and feel rushed, that is suggesting to me that you are not ready. Even if you have looked at a lot of other properties and this one is by far the best you still need to feel comfortable about the finances, both in terms of whether it represents decent value and whether you can afford it without being too stretched.

Something else to think about is that interest rates look as if they're heading down in the next few months (of course that's not guaranteed) but if that does happen then you don't want to be locked into a higher rate now when if you'd waited a bit you'd have more money put aside and potentially lower monthly repayments. I'm not saying don't go for it but just give it a lot of thought (which clearly you are) and don't be rushed.

Seen 5 others - we were starting to step back a bit because of some of the concerns as our solicitor phoned this morning having spoken to the seller’s solicitor and said that there have been no other offers other than 1 that was rejected and very low and they’re still very keen to sell so if that’s the case would mean they’ve essentially lied about getting a second offer at 190k (ish). Not really sure if I could contact the sellers firm myself to double check this as feels pretty bad. 

Unfortunately out of nowhere this afternoon we have been told we will be served 3 months notice to leave our current rental home as they want to sell. Had no clue it was coming so completely stumped, couldn’t make it up!! 

MeteredOut

ruf_ha11 said:

Cloth_of_Gold said:

How many houses have you looked at before you saw this one? Personally, unless there is a very good reason I wouldn't rush into it. It's a huge decision and one you will have to live with (as well as in!) for many years. As I said before, this is not the only house you will like and if you have doubts and feel rushed, that is suggesting to me that you are not ready. Even if you have looked at a lot of other properties and this one is by far the best you still need to feel comfortable about the finances, both in terms of whether it represents decent value and whether you can afford it without being too stretched.

Something else to think about is that interest rates look as if they're heading down in the next few months (of course that's not guaranteed) but if that does happen then you don't want to be locked into a higher rate now when if you'd waited a bit you'd have more money put aside and potentially lower monthly repayments. I'm not saying don't go for it but just give it a lot of thought (which clearly you are) and don't be rushed.

Seen 5 others - we were starting to step back a bit because of some of the concerns as our solicitor phoned this morning having spoken to the seller’s solicitor and said that there have been no other offers other than 1 that was rejected and very low and they’re still very keen to sell so if that’s the case would mean they’ve essentially lied about getting a second offer at 190k (ish). Not really sure if I could contact the sellers firm myself to double check this as feels pretty bad. 

Unfortunately out of nowhere this afternoon we have been told we will be served 3 months notice to leave our current rental home as they want to sell. Had no clue it was coming so completely stumped, couldn’t make it up!! 

Given that information, if you did decide to go ahead, I suspect the seller's fibs have indicated the region of the offer that would make him accept; around £190k. ie. they were hoping you'd bid above the £190k they've said they got, whereas they actually got one at £180k.

user1977

ruf_ha11 said:

Cloth_of_Gold said:

How many houses have you looked at before you saw this one? Personally, unless there is a very good reason I wouldn't rush into it. It's a huge decision and one you will have to live with (as well as in!) for many years. As I said before, this is not the only house you will like and if you have doubts and feel rushed, that is suggesting to me that you are not ready. Even if you have looked at a lot of other properties and this one is by far the best you still need to feel comfortable about the finances, both in terms of whether it represents decent value and whether you can afford it without being too stretched.

Something else to think about is that interest rates look as if they're heading down in the next few months (of course that's not guaranteed) but if that does happen then you don't want to be locked into a higher rate now when if you'd waited a bit you'd have more money put aside and potentially lower monthly repayments. I'm not saying don't go for it but just give it a lot of thought (which clearly you are) and don't be rushed.

Not really sure if I could contact the sellers firm myself to double check this as feels pretty bad. 

No, you don't do that. They're not allowed to talk to you and it will just mark you out as a bit daft (and irritating). If you want to communicate with the seller's solicitor you do it via your solicitor (or perhaps the estate agent).

Also bear in mind that 3 months notice from your landlord doesn't literally mean you get kicked out on that date, it's a longer process before you'd ever be evicted.

ruf_ha11

user1977 said:

ruf_ha11 said:

Cloth_of_Gold said:

How many houses have you looked at before you saw this one? Personally, unless there is a very good reason I wouldn't rush into it. It's a huge decision and one you will have to live with (as well as in!) for many years. As I said before, this is not the only house you will like and if you have doubts and feel rushed, that is suggesting to me that you are not ready. Even if you have looked at a lot of other properties and this one is by far the best you still need to feel comfortable about the finances, both in terms of whether it represents decent value and whether you can afford it without being too stretched.

Something else to think about is that interest rates look as if they're heading down in the next few months (of course that's not guaranteed) but if that does happen then you don't want to be locked into a higher rate now when if you'd waited a bit you'd have more money put aside and potentially lower monthly repayments. I'm not saying don't go for it but just give it a lot of thought (which clearly you are) and don't be rushed.

Not really sure if I could contact the sellers firm myself to double check this as feels pretty bad. 

No, you don't do that. They're not allowed to talk to you and it will just mark you out as a bit daft (and irritating). If you want to communicate with the seller's solicitor you do it via your solicitor (or perhaps the estate agent).

Also bear in mind that 3 months notice from your landlord doesn't literally mean you get kicked out on that date, it's a longer process before you'd ever be evicted.

I did think that was likely the case - guess just found it odd that they’d say there was one essential knowing we’d likely find out if there wasn’t but maybe just something to try and push us into making an offer quickly and at a price they’d want. 

Thanks - I’m going to look into the eviction stuff closer as I thought for no fault eviction it was longer than that, but only just been told it’ll be happening. It would be very frustrating to have to leave a few weeks before getting keys to a new house. 

justwhat

user1977 said:

Also bear in mind that 3 months notice from your landlord doesn't literally mean you get kicked out on that date, it's a longer process before you'd ever be evicted.

Yes you can stay there for ages ignore the request to leave and force the landlord to take legal action. This seems to be the norm more and more.