becoming a cash buyer

aeronic

I am looking to relocate to a different town, and am going 'up' in the housing market. (from 170k to 220k).

We have the option of selling as no chain, living with parents a bit, then buying as cash buyers.

The advantages are two-fold - each month living with parents puts us £1500 in the bank (we've done it before, before buying our first house). Obviously we dont want to live with parents forever, but in this uncertain market, I'm keen to watch for a bit and see what happens.

We currently own a house, worth about £170k and have a £145k mortgage.

Has anyone else done this, and how much leverage did it provide (I assume more at the buying end than the selling price).

ukmike

We currently own a house, worth about £170k and have a £145k mortgage.

So you won't be a cash buyer then?

nethesi

Hi there,

We did/are doing this at the moment (although didn't have the luxuary of staying with family, we've been renting) although not through particularly our choice. I would say it does make quite a difference in terms of negotiating on buying. ALthough we've never described ourselves as 'cash buyers' - saying we've got nothing to sell is more honest as we do need a mortgage. I've found a lot of people we've been talking to have been saying, 'our seller won't accept an offer from somone without an offer in place' and that gave us quite an edge. I think though it does add substantially to the disruption and stress of moving, although I think in the current market it can save you lots of money. You will have to pay more for solicitors doing it that way mind. Also don't bank on getting what you've had your current place valued for... although I bet there's loads of other people already telling you that :rotfl:

The big advantage for us was it gave us room to think about where we wanted to live in our new town, since we didn't know it very well...

nethesi

Hi there,

We did/are doing this at the moment (although didn't have the luxuary of staying with family, we've been renting) although not through particularly our choice. I would say it does make quite a difference in terms of negotiating on buying. ALthough we've never described ourselves as 'cash buyers' - saying we've got nothing to sell is more honest as we do need a mortgage. I've found a lot of people we've been talking to have been saying, 'our seller won't accept an offer from somone without an offer in place' and that gave us quite an edge. I think though it does add substantially to the disruption and stress of moving, although I think in the current market it can save you lots of money. You will have to pay more for solicitors doing it that way mind. Also don't bank on getting what you've had your current place valued for... although I bet there's loads of other people already telling you that :rotfl:

The big advantage for us was it gave us room to think about where we wanted to live in our new town, since we didn't know it very well...

pinkshoes

aeronic wrote: »

We have the option of selling as no chain, living with parents a bit, then buying as cash buyers.

The advantages are two-fold - each month living with parents puts us £1500 in the bank (we've done it before, before buying our first house). Obviously we dont want to live with parents forever, but in this uncertain market, I'm keen to watch for a bit and see what happens.

We currently own a house, worth about £170k and have a £145k mortgage.

If you're a cash buyer, you'd have £220k cash in the bank to buy a house for £220k, so to do this you'd have to live with your parents for almost 11 years!!

Your only advantage would be a buyer with no chain.

aeronic

Thanks for the replies,

I obviously used the wrong terminology. By cash buyer, I meant the same situation as a FTB.

Thanks for your input nethesi, I will speak to the bank and solicitors and see how their fees may vary.

PasturesNew

A cash buyer spots a house, then writes a cheque out for it from money they've saved.

You can't become one ... unless you save up.

aeronic

Please refer to my previous post. I accept the wrong use of terminology.

SouthCoast

My definition of a cash buyer is somebody who can exchange and complete on a purchase within 14 days.

lic

Being a cash buyer, or one who is not in a chain, does not mean you can negociate a cheaper purchase price, the seller will only sell for what hecan afford to. It might mean they will accept your offer over anothers who is in a chain though.
I have bought and sold many houses over the years, I have never sold for less than I had originally decided to sell for. But sadly have bought houses for more than I had planned.
This myth about cash buyer and not been in a chain, getting you a house cheaper stems from TV progs. like Location, Location. I have viewed this type of programme many times, but cannot recall of an instance where a vendor sold for less on those grounds only. Can anyone else?

otter1_2

aeronic,

You're just a no-chain buyer, like a FTB with an unusually low LTV on their mortgage.

lic,

I'm a FTB rather than someone who has left the market for a period, but our recent offer on a property was accepted despite apparently not being the highest offer, because we had no chain. I certainly pushed that point at every opportunity, and also the point that we would have a very low LTV on our mortgage. Both points were specifically checked again by the agent before the offer was accepted.