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  • FIRST POST
    • Fisa002
    • By Fisa002 12th Jan 18, 5:34 PM
    • 144Posts
    • 61Thanks
    Fisa002
    House we like already under offer by someone else but thereís an issue
    • #1
    • 12th Jan 18, 5:34 PM
    House we like already under offer by someone else but thereís an issue 12th Jan 18 at 5:34 PM
    Hi there.
    I have lurked around this forum for a few weeks after deciding Iím ready to purchase my first home. Iím a newbie to buying so bear with me if I ask something which may surprise some members. I literally just wanted other members thoughts and advice.

    So, I have been looking to purchase my first home to live in for a couple of months and viewed a few propertyís. There wasnt any properties really that I liked. I came across an area where there are about 3 houses for sale. 2 are very similar and are three bed town houses, and are priced around 220k. I love the area and the houses but found some of the rooms a little small for my liking and been pondering whether I should make an offer or not on one of the two. After viewing the second one of the 3 bed houses today I noticed a house around the corner with the same estate agent that is 4 bedroom house but much bigger inside ( after I looked at the property online). The guy from the estate agent told me that That house was under offer. Itís on the market for 270k, however there has been a problem with the current offer because the house valuation has come in lower. The house still listed online as being Ďunder offerí.

    I asked the estate agent how much the offer is on for and he wouldnít say, BUT he did say that THAT house would be more to my liking and needs and that I shouldnít worry, and that he would keep me in the loop.?? (Obv 270k is well over my budget which was around 230k stretched to about 240k.) He also did mention that an offer of 250k may do the deal if thereís a problem with the current offer ( I got an impression that there is). (And presumed the offer currently maybe lower that 250k?)

    So my questions are, who has valued the house higher? The bank or the conveyencer, and why would this be an issue to the buyer if they was happy to make that offer in the first place?

    And is the estate agent trying to obtain a second offer or higher offer? I donít really want to gazump somone else if they have there heart set on the house.

    And if that doesnít go through the likelihood of me making an offer lower towards my budget if that current one doesnít go through ?

    Iím really confused as you probably can tell and would appreciate members advice on my options and your thoughts on this. ( apologies for the long first post)
Page 1
    • moneyistooshorttomention
    • By moneyistooshorttomention 12th Jan 18, 5:39 PM
    • 15,855 Posts
    • 43,885 Thanks
    moneyistooshorttomention
    • #2
    • 12th Jan 18, 5:39 PM
    • #2
    • 12th Jan 18, 5:39 PM
    This is where you make it plain to the EA you are potentially v. interested in that house/decide whether you're prepared to make an acceptable offer on that house (which could be too high for you to be able to afford it from what you say) and ask the EA to give you "first refusal" to take a look at the place IF the current buyer for it falls through.

    If they do fall through - then you're in luck - provided you can afford it.

    If you can't afford it and/or the current offer doesnt fall through = better luck next time
    *******************
    • Slithery
    • By Slithery 12th Jan 18, 5:41 PM
    • 727 Posts
    • 1,135 Thanks
    Slithery
    • #3
    • 12th Jan 18, 5:41 PM
    • #3
    • 12th Jan 18, 5:41 PM
    So my questions are, who has valued the house higher? The bank or the conveyencer, and why would this be an issue to the buyer if they was happy to make that offer in the first place?
    Originally posted by Fisa002
    Chances are that it's the buyers mortgage provider that has valued it at lower than they have offered, leaving them unable to get a mortgage.
    • hazyjo
    • By hazyjo 12th Jan 18, 5:46 PM
    • 10,652 Posts
    • 13,936 Thanks
    hazyjo
    • #4
    • 12th Jan 18, 5:46 PM
    • #4
    • 12th Jan 18, 5:46 PM
    Chances are that it's the buyers mortgage provider that has valued it at lower than they have offered, leaving them unable to get a mortgage.
    Originally posted by Slithery
    They could get a mortgage, but would have to make up the rest with cash. Depends if they want to overpay (many do with a low valuation), and if they have the dosh.


    I would guess the offer is higher than £250k but that the valuation has come in at around £240k-ish. Just a hunch though.
    2018 wins: Single Malt Whisky; theatre tickets; festival tickets; year of gin(!); shoes
    • studentguy
    • By studentguy 12th Jan 18, 5:48 PM
    • 113 Posts
    • 47 Thanks
    studentguy
    • #5
    • 12th Jan 18, 5:48 PM
    • #5
    • 12th Jan 18, 5:48 PM
    My worry would be that in that situation that the same would happen to me - you don't know what the bank has valued it at, or why they've come to that figure (maybe something is wrong with the property somewhere?) - and you'd lose money on fees and be in the same boat
    Despite my name, I'm not a student any more
    • Fisa002
    • By Fisa002 12th Jan 18, 5:56 PM
    • 144 Posts
    • 61 Thanks
    Fisa002
    • #6
    • 12th Jan 18, 5:56 PM
    • #6
    • 12th Jan 18, 5:56 PM
    The estate agent knew that I was very interested as I was describing what I wanted when he was showing me around the smaller house. He knows I am chain free and have a MIP. He also has said that he would let me know next week and Ďnot to worryí and also said Ď he would be in touch if it fell throughí.

    Why do you think he said 250k would get me that house? Tbh 250k is 10k over my absolute budget. I donít really think itís worth the 270k itís on for at all.

    And when I asked what the valuation came at he laughed at winked at me. Is this information not usually given out? Sorry to ask this question but I really donít know the answer.
    • Fisa002
    • By Fisa002 12th Jan 18, 5:58 PM
    • 144 Posts
    • 61 Thanks
    Fisa002
    • #7
    • 12th Jan 18, 5:58 PM
    • #7
    • 12th Jan 18, 5:58 PM
    Do you think if I had it valued once I made an offe the same thing would happen? And if itís valued at 240k thatís totally my max budget.
    • moneyistooshorttomention
    • By moneyistooshorttomention 12th Jan 18, 6:08 PM
    • 15,855 Posts
    • 43,885 Thanks
    moneyistooshorttomention
    • #8
    • 12th Jan 18, 6:08 PM
    • #8
    • 12th Jan 18, 6:08 PM
    The estate agent knew that I was very interested as I was describing what I wanted when he was showing me around the smaller house. He knows I am chain free and have a MIP. He also has said that he would let me know next week and Ďnot to worryí and also said Ď he would be in touch if it fell throughí.

    Why do you think he said 250k would get me that house? Tbh 250k is 10k over my absolute budget. I donít really think itís worth the 270k itís on for at all.

    And when I asked what the valuation came at he laughed at winked at me. Is this information not usually given out? Sorry to ask this question but I really donít know the answer.
    Originally posted by Fisa002
    I'd interpret that as meaning the valuation came in at £250,000 from what you say.

    Offer that you might get it.

    Offer less and chances are you won't.
    *******************
    • Annie35
    • By Annie35 12th Jan 18, 6:09 PM
    • 217 Posts
    • 184 Thanks
    Annie35
    • #9
    • 12th Jan 18, 6:09 PM
    • #9
    • 12th Jan 18, 6:09 PM
    IF the vendor was okay with selling at the lower valuation surely they would continue the sale with the current buyers, no?
    • Cakeguts
    • By Cakeguts 12th Jan 18, 6:13 PM
    • 4,424 Posts
    • 6,359 Thanks
    Cakeguts
    There is a house for sale at £270k It is has had an offer accepted on it. The valuation is lower.

    So the buyer either makes up the difference between the offer and the valuation with cash or they drop out.

    If they drop out there is no guarantee that the vendors will sell the house for any less than that offer. A buyer with a bigger deposit could come along. The vendors may decide to not sell the house if they can't get what they want for it.

    It is unlikely that the vendors will accept an offer of £230k or £240k when they expected to get around £270k especially if as you say it is a much nicer house than the ones you have been looking at.

    It is not a good idea to look at houses you can't afford. The most likely outcome of your situation will be that they EAs have other people also interested in this house who can afford to pay more for it than you can. They aren't going to tell you if this is the case.
    • eddddy
    • By eddddy 12th Jan 18, 6:17 PM
    • 6,496 Posts
    • 6,381 Thanks
    eddddy
    He also did mention that an offer of 250k may do the deal if there!!!8217;s a problem with the current offer ( I got an impression that there is). (And presumed the offer currently maybe lower that 250k?)
    Originally posted by Fisa002
    You can read it many different ways, but I'd suspect that the current offer is £250k - or maybe higher.

    i.e. The EA wants to get you into game with an offer of £250k and get you excited about the property, then tease you upwards.

    Plus, if you offer (even if it's too low), the EA can scare the other buyer by saying that somebody else is chasing the property.

    And is the estate agent trying to obtain a second offer or higher offer? I don!!!8217;t really want to gazump somone else if they have there heart set on the house.
    Originally posted by Fisa002
    In general, EAs don't like gazumping - it gives them extra work, it delays the sale, and the extra few quid in fees aren't worth it.

    The main thing the EA wants is the quickest possible sale, so they want you ready to jump in asap, if the current buyer drops out.


    But obviously, if the current buyer's lender has down-valued the property, your lender might as well. Would you buy it, if your lender down-valued?
    Last edited by eddddy; 12-01-2018 at 6:23 PM.
    • Fisa002
    • By Fisa002 12th Jan 18, 6:23 PM
    • 144 Posts
    • 61 Thanks
    Fisa002
    IF the vendor was okay with selling at the lower valuation surely they would continue the sale with the current buyers, no?
    Originally posted by Annie35
    Not sure what you mean by this. I think itís the buyers that have been given a lower valuation by either the conveyencer or more likely the bank right? If the vendor was given a lower valuation initially they would market around what they and the EA think it was worth right?
    • eddddy
    • By eddddy 12th Jan 18, 6:28 PM
    • 6,496 Posts
    • 6,381 Thanks
    eddddy
    IF the vendor was okay with selling at the lower valuation surely they would continue the sale with the current buyers, no?
    Originally posted by Annie35

    Not sure what you mean by this. I think it!!!8217;s the buyers that have been given a lower valuation by either the conveyencer or more likely the bank right? If the vendor was given a lower valuation initially they would market around what they and the EA think it was worth right?
    Originally posted by Fisa002
    Probably easier to illustrate with an example:

    Say...
    - The buyer has offered £255k
    - The buyer's lender has valued it £240k

    If the vendor was prepared to accept £240k - they would sell to the current buyer. (They would have no reason to sell it to you for £240k)
    Last edited by eddddy; 12-01-2018 at 6:31 PM.
    • Fisa002
    • By Fisa002 12th Jan 18, 6:30 PM
    • 144 Posts
    • 61 Thanks
    Fisa002
    You can read it many different ways, but I'd suspect that the current offer is £250k - or maybe higher.

    i.e. The EA wants to get you into game with an offer of £250k and get you excited about the property, then tease you upwards.

    Plus, if you offer (even if it's too low), the EA can scare the other buyer by saying that somebody else is chasing the property.

    In general, EAs don't like gazumping - it gives them extra work, it delays the sale, and the extra few quid in fees aren't worth it.

    The main thing the EA wants is the quickest possible sale, so they want you ready to jump in asap, if the current buyer drops out.

    But obviously, if the current buyer's lender has down-valued the property, your lender might as well. Would you buy it, if your lender down-valued?
    Originally posted by eddddy
    Thanks I didnít really think about the EA trying to get it even higher. I guess he knows what my budget was when I looked around the other two houses.

    Would I buy it if the lender down valued? I donít think I would offer at 250k it would be more towards my max budget. I guess most people have this risk when purchasing a house Ďwhat if the lender down valuesí
    • Fisa002
    • By Fisa002 12th Jan 18, 6:34 PM
    • 144 Posts
    • 61 Thanks
    Fisa002
    Probably easier to illustrate with an example:

    Say...
    - The buyer has offered £255k
    - The buyer's lender has valued it £240k

    If the vendor was prepared to accept £240k - they would sell to the current buyer. (They would have no reason to sell it to you for £240k)
    Originally posted by eddddy

    Ah got it Eddy. Thankyou, it makes sense. I guess I should just wait until next week and see what happens just in case. You never know right?
    • eddddy
    • By eddddy 12th Jan 18, 6:34 PM
    • 6,496 Posts
    • 6,381 Thanks
    eddddy
    I guess most people have this risk when purchasing a house Ďwhat if the lender down valuesí
    Originally posted by Fisa002
    Yes.

    But in this case it has already been down-valued once. So it's very likely to be down valued again.

    Quite a few lenders use the same valuation companies, so it might even be the same valuer who is asked to value it again. (And he/she won't change their mind on the value.)
    • Fisa002
    • By Fisa002 12th Jan 18, 6:35 PM
    • 144 Posts
    • 61 Thanks
    Fisa002
    And hence that!!!8217;s why he ( the EA) laughed when I asked how much the valuation was for right?
    • Fisa002
    • By Fisa002 12th Jan 18, 6:38 PM
    • 144 Posts
    • 61 Thanks
    Fisa002
    So if it!!!8217;s likely to be down valued again, and again, surely the Vendor is likely to drop the asking price or not? And why can!!!8217;t the EA give an idea of what the valuation has come in at? Grr this is so frustrating but really appreciate the responses !!
    • goodwithsaving
    • By goodwithsaving 12th Jan 18, 6:41 PM
    • 825 Posts
    • 1,265 Thanks
    goodwithsaving
    So if itís likely to be down valued again, and again, surely the Vendor is likely to drop the asking price or not? And why canít the EA give an idea of what the valuation has come in at? Grr this is so frustrating but really appreciate the responses !!
    Originally posted by Fisa002
    Because the house is UNDER OFFER and it is none of your business at this stage. It is between the vendor and buyer.
    Every time you borrow money, youíre robbing your future self. ĖNathan W. Morris
    • Fisa002
    • By Fisa002 12th Jan 18, 6:53 PM
    • 144 Posts
    • 61 Thanks
    Fisa002
    Apologies if I sounded rather keen. I just want to be in a good position with an offer should I get a call next week.
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