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House Price Dilema
jamieboy
Posts: 136 Forumite
Sorry I originally posted this in the wrong place.
My son is in the process of buying a town house for £130k, he is worried that he will be buying into negative equity. He is a first time buyer with no chain and his mortgage in place, they are probably only a few weeks from completion. He is not sure whether to proceed or to ask the seller for a reduction, any advice please.
My son is in the process of buying a town house for £130k, he is worried that he will be buying into negative equity. He is a first time buyer with no chain and his mortgage in place, they are probably only a few weeks from completion. He is not sure whether to proceed or to ask the seller for a reduction, any advice please.
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Comments
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Sorry I originally posted this in the wrong place.
My son is in the process of buying a town house for £130k, he is worried that he will be buying into negative equity. He is a first time buyer with no chain and his mortgage in place, they are probably only a few weeks from completion. He is not sure whether to proceed or to ask the seller for a reduction, any advice please.
Hard to say without more information...
- How much deposit is he putting down?
- What multiple of his salary is the mortgage?
- Where is the property located?
- Is it a new build?
- Is he in a secure job?
- Has factored in monthly expenditure on bills etc?0 -
He absolutely must ask for a $20K reduction.
Get him to check the last selling price on www.houseprices.co.uk to see how much he can get away with.0 -
He is putting 10% down, the house is in a good area and it's 4 times his salary and he has got a secure job. He is just worried about the state of the housing market, if he was aleady in the house he would have to accept the situation but he doesn't want to buy into something that could rapidly devalue but as it's his first house, he wants to go for it but just wonders if it's too late to put in a lower offer.0
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caveatvenditor wrote: »He absolutely must ask for a $20K reduction.
Get him to check the last selling price on www.houseprices.co.uk to see how much he can get away with.
I think that asking for £20k off the price at this stage is a bit ridiculous and without getting in to a moral debate regarding gazundering, I am pretty sure that the market has not dropped 15% since the OP's son put in the offer.0 -
If nothing has been signed, he can offer whatever he wants.
I remember this feeling all too well, when I bought my first property in 2001.
Everyone was saying...'Dont buy now..Its the top of the market..you'll lose money' but went ahead and property has increased 85% in value.
However, I think we are at the beginning of a recession, which then affects house prices, economy, etc.
You say his job is 'safe'.. Is it... If the credit crunch dilemma isn't sorted soon, everybody is in big trouble.
All my opinion of course...I would say buy it, but fix the mortgage terms for as long as possible.
Tass0 -
Your son needs to be comfortable with his purchase. It is a huge amount of money so he needs to be sure that he is doing the right thing.
Nobody knows if the house is good value so cannot comment on the price.
Nobody knows what the market will be like in a year or two but we all can make guesses. Many people have guessed before and been wrong.
If he wants to put in a lower offer, he can. Unfortunately, that is one of the problems with the house-buying process. This course of action could incur significant costs to others in the chain and it is about time this was changed.
That said, your son only needs to look after himself. If he has doubts he needs to let people know.
GGThere are 10 types of people in this world. Those who understand binary and those that don't.0 -
caveatvenditor wrote: »He absolutely must ask for a $20K reduction.
Get him to check the last selling price on www.houseprices.co.uk to see how much he can get away with.
When you are selling I hope this doesn't happen to you. In a good market do you suggest that sellers should review their price every week with view to increasing!!!A retired senior partner, in own agency, with 40 years experience in property sales & new build. In latter part of career specialising in commercial - mostly business sales.0 -
Thanks chickmug, point taken.0
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