Local council reducing offer on flat we are selling to them

BobbyJay

So, my partner is selling her ex-council (leasehold from the Council) flat in order for us to buy a larger place together.  Her flat is the only privately-owned one in the block.  She's keen to support the Council getting more social housing back, and the lack of any chain behind is attractive too.

The Council made her an offer based on a survey they had conducted.  The offer was at the low end of market value, but we viewed it as a 'guaranteed' quick sale.  Solicitors have therefore been instructed and paid.

The Council have today informed her that they are reducing their offer by a few thousand because they have been made aware of work on the building - presumably by a different part of the same department.

Obviously she could withdraw from the deal, lose the money committed to solicitors, and sell privately.  I feel like this is a brazen attempt by the Council to lowball, knowing that funds have been committed, and that it is reasonable to tell them outright that we accepted an offer based on an assumption that they had all the information they needed as the custodians of the overall fabric of the building, and that as such their original offer should stand.

But how would MSE forum users suggest we best proceed?

sammyjammy

I'd say you shouldn't have assumed and you'd be in the exact same position once any buyer found out about planned works.

theartfullodger

Nothing to stop you informing them you hadn't realised the price was flexible, and it has gone up the same amount they dropped.  

Doubt that would work mind...

martindow

I imagine a local council is conscious that they should be seen to be paying a fair price when buying your flat.  If work is in the pipeline for the flat that reduces its value.  Council tax payers would not be happy to find that the council has paid above the actual value for the flat.  You will still have the advantage of no chain and no estate agents fees if you carry on at the lower price.

Unless you are very sure that you could get more on the open market and are happy to spend more time before the sale goes through, it would be best to carry on selling to the LA.

jimbog

Could you give an idea of the numbers involved? Down valuing by a few thousand doesn't seem that much.

Considering how many private flat owners in council blocks around the country are being lumbered with hefty bills to pay for works I would press ahead

BobbyJay

Thanks guys.  Totally agree that it's a big assumption about a fixed offer - we wouldn't expect that from a private buyer who you'd expect to appoint a surveyor and then readjust if there is anything major.  But this offer was made after a surveyor had visited.  The main problem we have is that the Council haven't made it clear what this major work is.  There was no indication to her as the owner that there is planned work that she would need to contribute to, and without that this seems a bit strange that the Council have only decided this needs to be done now. 

TheJP

BobbyJay said:

Thanks guys.  Totally agree that it's a big assumption about a fixed offer - we wouldn't expect that from a private buyer who you'd expect to appoint a surveyor and then readjust if there is anything major.  But this offer was made after a surveyor had visited.  The main problem we have is that the Council haven't made it clear what this major work is.  There was no indication to her as the owner that there is planned work that she would need to contribute to, and without that this seems a bit strange that the Council have only decided this needs to be done now. 

This is part of the conveyancing process, nothing to do with a survey. The solicitor would have reviewed the pack and done diligence specifically to determine if there are any planned works that need to be considered. The price isn't fixed until exchange of contracts anything is negotiable. 

lincroft1710

Being the only privately owned flat in a council block isn't the best place for a vendor to be. Do you honestly think you would get more on the open market, where you will have estate agent's fees to pay and dithering buyers with solicitors asking interminable questions, not to mention over cautious surveyors?

BobbyJay

jimbog said:

Could you give an idea of the numbers involved? Down valuing by a few thousand doesn't seem that much.

Considering how many private flat owners in council blocks around the country are being lumbered with hefty bills to pay for works I would press ahead

It's only 6k, so a 2.5% reduction. But we've just found out that this is for an aspiration to replace exterior doors in 2024.  It feels unreasonable to pay for something that isn't safety critical and might get done in three years, or, given how slow the Council has been in the past to rectify actual safety defects, might get done a long time after that.

TheSpectator

BobbyJay said:

jimbog said:

Could you give an idea of the numbers involved? Down valuing by a few thousand doesn't seem that much.

Considering how many private flat owners in council blocks around the country are being lumbered with hefty bills to pay for works I would press ahead

It's only 6k, so a 2.5% reduction. But we've just found out that this is for an aspiration to replace exterior doors in 2024.  It feels unreasonable to pay for something that isn't safety critical and might get done in three years, or, given how slow the Council has been in the past to rectify actual safety defects, might get done a long time after that.

At the end of the day your partner either accepts the reduced offer or not. The reasons are pretty irrelevant tbh.

Bookworm105

BobbyJay said:

jimbog said:

Could you give an idea of the numbers involved? Down valuing by a few thousand doesn't seem that much.

Considering how many private flat owners in council blocks around the country are being lumbered with hefty bills to pay for works I would press ahead

It's only 6k, so a 2.5% reduction. But we've just found out that this is for an aspiration to replace exterior doors in 2024.  It feels unreasonable to pay for something that isn't safety critical and might get done in three years, or, given how slow the Council has been in the past to rectify actual safety defects, might get done a long time after that.

nonetheless any other buyer will enquire what works are planned and given yours is the only privately owned one in the otherwise all council block, if the buyer is worldly-wise they will know that their share of the works bill is going to be "substantial" and so they too would reduce their offer.

as your partner is "keen to support the council retaining social housing" then the old adage applies: bird in the hand worth 2 in the bush