The person who's house I am buying, is interested in buying my apartment. Advice needed on how to proceed please...!(18 Posts)
We have seen a 3-bed house we really like. The vendor is a divorcee of around 50 has ill health and needs to sell asap. She has been on the market a while & dropped her price considerably.
We are selling our 2-bed apartment with a courtyard within a 15 min drive max of the location the house we like is situated. Our current estate agent is pressuring us to drop our price, which we are reluctant to do as we have already done this.
As it turns out, the vendor of the property we like is looking to downsize to a 1-2 bed apartment, which needs outside space for her cats, and which needs to be in the proximity of her current proximity, she has a car. She has been looking at property approx £10,000 over the price of our apartment.
Our contract with our current estate agent is due to expire in 2.5 weeks. We had already considered changing to the estate agent dealing with the property we like.
So, agent for the vendor says she may be interested in a part-exchange so to speak. This agent's eyed had lit up when we said we were almost at the end of our contract with agent and they had been a bit crap (chuh-ching! I expect she was thinking!).
So, her agent calls her, and she wants to view our property, arranged for thursday. The agent has now spoken to her director who says there is a way around the legalities of her viewing through them not our agent, and he would like to come out to see us himself tomorrow and discuss this and possible contract with us once our current one expire etc.
For them, this is clearly a win-win situation - they go from no sale, to 2 sales, and in this market, they need all they can get.
For us, and for the vendor, it also seems a win-win situation. She cannot proceed with buying an apartment, or finalise her divorce until she sells. We can't offer on her place seriously until we sell our place. So if she buys ours, and we buy hers, we both get property and our chain is a loop so to speak!
I have two questions:
1. If the vendor views our property and wants to make an offer, can we/should we/how do we bypass the estate completely in this and sell privately? Seeing as the point of an estate agent is to go and find people to buy our property, and if she offers on our place, can she just do it through us? Of course we would still buy her place through her agent.
2. We know what we want to offer on the property, we have what we want to offer, and a final figure of what we will pay. So my thinking is, if she is desperate to sell, more so than us, she will seriously consider our apartment. We have said the minimum that we will accept, and that there is no room for negotiation on it (there is, but the agent does not know). Should we place our first offer before she looks at our place, stating that this offer was based on our selling our apartment for £xxx. Then she would view our place with the knowledge that should she like it, she has sold her place. Thus showing our lovely apartment in an even more positive light. It would also give her a figure to consider when she sees our place and decides if it is worth what we are asking. Then, if she wants a bit more, or wants to offer less on ours, we can negotiate around that (we are prepared to go up to close to but not the asking price).
Phew, if you manage to read this, well done. I know it is long, but I am no good at shortening my summaries. Sorry!
If you want to save more money you could just pay her the difference in price between your property and hers! That way you would both save a lot on stamp duty and the estate agents' commission (assuming it is a percentage).
For example, if your apartment is worth 200k and her house is worth 400k then you sell your apartment for £1 and she sells for 200k + £1.
To answer your questions you probably could bypass the estate agent and sell privately if your current agent has not introduced her to you.
With the second point she may class you as more desperate to sell! There would be a big advantage in a loop, a lot of chains are breaking down at the moment, so bear that advantage in mind when negotiating. If your apartment has been on the market for some time then it is probably over valued. The same for her house of course.
Good luck, let us know what happens!
Milky - Our place has been on the market for 3 months, hers for almost a year! I agree with you about our place possibly being over valued, its a possibility of course.
So, if we decided to sell our property as you say, are there any specific legal implications that we should be aware of? I like that idea!
We have not been introduced by our current agent, but by her agent.
We have just bought a house from a divorcing couple. The woman bought ours. We went through the agent and had to pay him a fee as he arranged the introduction. In prnciple I could have approached her privately, as I saw it last summer, it was overvalued, went back on the market at a much reduced price, saw it again through the agent. I guess i could have slipped a note through her door.
In our case, while it was painful to pay the agent the woman and the situation (acrimonious divorce with the couple still living in squabbling) the estate agent earned his keep. It would have been a huge headache dealing with them directly and I think it wouldn't have gone through in the end for various reasons. But he was technically representing both of us. COnflict of interest arguably, but it was supposedly okay. I would ask your solicitor about the legal implications of cutting that agent out. You don't want to be warring with someone who is trying to claim some sort of introduction role.
Re the price, we offered, they came back, etc until we got to the differential we wanted. I think it worked to our adfvantage we waited for her to see it before we offered, sher eally liked the place.
Sorry that was a quick response as DH shouted for me that dinner was ready, for the third time!
So, if we bypassed the agent, and sold to her directly, what would the benefits/disadvantages to this? For example, she would usually offer via agent, and once this is accepted, the initial legalities are sorted via agent (from what I remember, only done it once a few years ago!). So, if she offers and we accept, what happens, we contact our conveyancer immediately to get acceptance in writing?
What if we choose to go through the agent? What would be the purpose of that? What do they do as well as introduce buyers and sellers? What do they do that is worth the Ks thay they will get paid?
I doubt very much that the vendor would be prepared to sell directly to us to be honest. So, that option of us just paying the difference is unlikely!
So, to avoid appearing desperate, we should hold off on an offer until we know if she is interested in the apartment. The reality is we could drop a bit if she was not interested in order to sell it quickly, if she took a lower offer on hers so if she is not interested, the house is not a no-no.
Also, if she is not prepared to accept our max offer, we are not too desperate to sell. Up until last week when we viewed this place again (we originally looked at original price months ago) that we considered that we might actually sell - we sort of got the impression the market might not be going in our favour (no, really?!!! ) and that perhaps we can stay here afterall, we have a deposit to put down, so if we stay we can actually lower our outgoings, not increase them, so there are advantages to staying. We will only buy for the right price.
Its just hard to know how to get the right price, iyswim.
Oh this is so scary!
Harri ett - thank you for your response! We have been talking about the fact that if anyone got commission we would want it to be the vendor agents not our current, as our current agent have been pretty poor in terms of marketing our property etc, I would have hated for them to get a commission for work another agent did!
I also take your point about the introductions too. They did clearly introduce us, and I guess that it why the agent wants to come with the woman, then it is evidenced that they introduced!!! They are on the ball, clearly!
Your situation sounds similar to ours, in that we saw it, overvalued, and now it is, what we consider to be a good deal, if we can get it close to what we want to pay, which we think we will.
The director of the estate agents for the vendor is coming tomorrow (must get biccies...note to self) so we will play it cautious and just check out what he is offering.
Oh and Harriett - glad you got the house! I am pleased to hear a success story, makes ours more like a possibility, rather than a thread to cling too. I am trying not to get excited as it seems to good to be true...
Any more good advice, any more like Harriett who have done this too?
OUrs felt too good to be true as well. But the house had been on the market for sooo long, and the concept of no chain really appealed to them. We also strictly speaking could have lived with not moving, so the ball was in our court re the price, we could say take it or leave it to them.
If you haven't signed a contract with the other agent (introducing) you might not HAVE to and would thereby bypass the fees. Do you have a solicitor you can ring? Our situation (possibly through our own fault but going through the agent the second time) was different in that regard, we engaged them.
I guess you could have your solicitors speak, thereby removing the need to negotiate with them directly on various points, as opposed to the agent.
You can't pay the difference - it's not legal - it's tax evasion. You can't do it.
As far as I can see, there is no reason to pay either agent if she decides to buy your apartment. You found her through your sale - your current agent didn't find her and the agent selling to you didn't find her on that premise and there is no contract so if she wants to buy your apartment, negotiate directly and work out prices that are best for both of you. Although you might find it hard face to face, in this market it might be better for both of you to put your cards on the table and not dance to the agents' tune when they try and facilitate squeeze blood from the sale. If you feel uneasy, negotiate terms through your solicitor.
Ditto onceinalifetime... you would be evading tax at £1 and £200k + £1 but you could make the offers realistically on the low side, say £160k and £360k. You can save on stamp duty, I believe it is only payable on more expensive property and so you may be able to negotiate that your buyer contributes something towards the amount.
You must look at your contract but it would be unlikely you would have to pay your agent as most stipulate they have to introduce a buyer unless it is part of a joint agency. If you informally agree an arrangement with the buyer, you could just wait a few weeks until you can give them the boot and then proceed. I would negotiate hard on paying anything to other agent (maybe a small sum rather than a percentage because, let's face it, you have helped him considerably by buying apparently unsellable house).
i also think that it would be a problem for the land registory as the purchase price neeeds to be registored with them,
and the solicitor needs to be honest about the sale price to the mortage lender etc,
as for using the other agent, why is it 'removing' the agents involvement, i am guessing that the sellers agent who is coming tomorrow will want his cut,
you could play them off against each other to get the best price but beware, if the original agent can in any way prove that the lady is buying your house because of any advertising, sale board or introduction then they can chase you for all or some of thier fee,
it sounds like a good idea, and if it works then you are cutting out loads of hassle by removing the chain,
let us know how you get on
as lalala says,
offer the agent a 'finders' fee but no more,
have you told them what % you are under contract for?
if not i would be telling the sellers agent it is a little less than you agreed
In our case, the agent in question mentioned to us that the woman was looking for an Edwardian in the area only smaller, I said why not ours. So, the fact that they helped set it up is pretty indisputable although as I said in principle I could have waited and approached her privately. Then she could have taken her house off the market, etc. I'm just trying to make myself feel better for having taken them on and paid such a great wad of cash out.
It sounds like your situation may be a bit different though - and that the agent might have been a bit later to the game.
onceinalifetime FWIW - I would not pay the difference, I have a mortgage to pay anyway so that would not work even if we wanted it too! The agent is arguing that he is introducing her, by setting up the initial meeting!
The agent certainly wanted his fee! We have agreed on like for like % as I had not read any MN posts before work today! Wish I had though, might have been able to haggle more! However, it is for a one-off introduction, so I feel like we have been stitched for a few hundred pounds as he is not marketing our property, but he is paying for our HIP - we already have one with current agent, but dont have to pay our current agent unless we want a copy of it, otherwise it is free but they keep it. So this 'new' agent has offered to pay for it to be completed again so we don't have to go ask for it.
Clearly its underhand, he has made it clear this is not technically by the book, but the reality is that our current agent will not know why we have not continued with our contract when it ends. As far as they are already concerned we have been thinking of taking it off the market anyway and that is what we will tell them.
So, we have probably lost out a little on the negotiating a good fee but it does sounds promising, he said she is keen already, but he would wouldn't he! . And to be honest, if we did not do this, we would not stand a chance of selling our apartment and buying this new house at all, we would be taking our place of the market. So, yes we are green and it has shown, but we still might be able to claw some back in our offer price negotations.
Oh to be new to the housing game at such a dodgy time!!!
crap. Been thinking about this a lot.
Could probably have saved a grand here. If I was smart/pushy enough at myself. Could have paid for most of the new bathroom we need! grrrrrr. Bloody salesmen!
You need to look at the contract with your current agent. Make sure they are not entitled to commission on any sale introduced during their agency period, whether or not they effected the introduction. Some contracts say this. Some agents (like Foxtons) are in the habit of suing for their commission.
Oh well, the woman does not want to offer. She loves the flat, but thinks our courtyard is a bit lacking in privacy! Funny really as she has only seen one with a private garden at all....this one!
It was a long shot anyway, so not too disappointed.
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