To pull out of house purchase so close to exchange or gazunder?

[TitaniumBev]

Totally miserable - any advice/views/abuse welcome!

We're FTB's, both 30, scrimped for years to get deposit together. We both grew up dirt poor & wanted to have a bit of security before children so are keen to get going now and sick of private renting.

Offer accepted on house end of Jan, the asking price was kite flying given location (Croydon). They wanted 460k we settled on 440k, only now due to exchange next week after delays (both sides, minor errors).

Since then though all the news around the economy & housing especially around London has been terrible. Monthly drops of around 1 - 3.6%. Terrible rics reports & rightmove data etc. Similar properties in the area are coming on for less but there is not a lot coming on so hard to judge. Properties hanging around for a long time.

I now feel the agreed price is too high, a lot has changed in 4 months and I think it's best to walk away. I know this will screw over the vendors & the chain but don't like DH's suggestion of asking for a reduction so close to exchange. He thinks we should at least give them the chance. (How lucky!!!) Prices seem to be down around 6% he reckons split and ask for 3% off. (£13,000 ish)

Its such a big transaction, the market looks soooo bad and its not dream house or anything. Should I walk or offer lower? I'm not going to over pay for a house just to be nice/honorable unfortunately.

URGH!

£440k is not bad for Croydon. what area?

It is not selfish- it is a realisation that has come late in the process and do not let anyone guilt trip you. They will find another buyer- you paid for the survey right, not them. I think it is smart of you to realise that this is a life changing transaction and the economy has changed since January- it is selfish ofposters to suggest you are being selfish to b e honest. You are not about to buy a fridge on gumtree- this is almost half a million pounds on an average little house in a place that is hardly on the list of places people want to live in London.

Aren’t you planning to live there though? We bought at a peak but because we’re planning on staying at least 5 years the market will have gone up and down innumerable times. We offered what we were happy with at the time of the offer.

Either option is dreadful - you agreed the price and proceeded to a week before exchange and only now are you being concerned about London (Croydon) house prices and the economy?
Bad business

We ideally wanted to upsize this year but after looking what was on the market & the fact that it’s wouldnt be a long term move we didn’t want to risk it. Obviously we didn’t put in any offers unlike the op.

We are selling at the moment and yes I worry what the market will do but we’ll stay where we go for a while. We sold our last house and it’s probably worth 100k more than our buyers paid for it now. A friend of mine got a large inheritance from a family member (100k). They thought house prices would drop 10 years ago (we are commuter belt). They’ve risen and stayed high ish. They’re still living in rented now. They’d have made a fortune on a house.

Why on earth didn’t you have this conversation earlier? Your data sources don’t sound reliable.

Either pull out or buy it. Don't faff about trying to beat the price down.

Do you have concrete proof of the pricing changes or just media? Cos that generally happens every few months.

Have you looked at the prices in the area of what you want to buy? Do you have a consensus across a few that the asking price is no longer reflective of the market?

Not something I would do, every property we have ever put an offer in on we have purchased, without any funny business. Moving is very stressful without people messing around. If you can do this and sleep at night good for you, but expect it to bite you on the bum at some point, I am a firm believer in what goes around comes around. Buying property is a long term investment, the property market is subject to fluctuations short term, but prices always rise as people need homes.

Tansie1 "I'd be interested to know how many of you have written to your MPs vociferously demanding that the English house buying and selling shenanigans needs urgent attention"

I have. That and various aspects of leasehold law have been the subject of quite a few letters between us. Sadly he can't see much appetite for change either,

Americanlife --Totally agree that this is a big decision - which begs the question why all these issues re price fluctuation etc were not taken into account and considered carefully before the original offer was made - smacks of the op looking to make a quick buck following her update re moving abroad in 4 years, and suddenly realising that this is not going to happen. Not only morally deficient but intellectually as well.

Villageshop- wow just wow! OP,
"I don't know why you asked if you're not prepared to acknowledge that the overwhelming majority say it's a dreadful, morally indefensible thing to do. But then we don't know you, thank goodness. You have to live with yourself after this, we don't. Fill your boots, you'll be weighed down and regret it, guaranteed."

Fill her boots- she is about to hand over 440 for a home that the owner will have paid so much less for- if anyone is filling their boots it will be the seller rubbing their hands they can get almost half a million for an ordinary home. I cannot get over all the high and might ethics of posters on here. This is a massive financial transaction and the OP is having wobbles and I would be too. It is never too late to turn back when you are the wrong road. Only the fool carries on once they have had that realisation. CS Lewis being paraphrased there.
No one should be counting on anything-till that sale is closed and till it is the OP has every right to pull out and I hope she is not swayed by all the self prescribed supreme court judges on here.

americanlife, di you have any knowledge of the London market?

£440k 'for an ordinary home' might seem to be ridiculous but sadly it's not.

The fact is no one on here can really comment because the OP is changing her story.

First she was sick of renting, now she's moving abroad in 4 years despite buying a house next year and being perfectly happy to rent until then.

Either pull out or buy it. Don't faff about trying to beat the price down.

If the seller is desperate to sell by a time limit, then offering less rather than walking away completely is what the seller wants, a delay isn't going to help them.

The OP has already decided they're not willing to pay the price they offered 4 months ago (sensibly I'd say given what they've said) so buy it is already out. No reason not to give the seller the choice if they are willing to buy it for less.

I think you’re making a really poor decision. I know the market in that area fairly well and the stuff that is impacting the minor overall drops are the £800k plus houses, not your price point. I know someone who has just exchanged on a £475k house in Croydon and they had three offers of asking price - that was just a few weeks ago.

There is a real lack of stock coming to the market at this level and lots of FTBs who can’t afford places more centrally and see the value add from Westfield and other regeneration projects.

I suspect this will be your loss and someone else’s gain. Bloody hope it is tbh, you’ve got an awful attitude.

You should have never offered on a house you didn't completely love.

For the sake of 13k I think yabu. In the grand scheme of things that is hardly a lot and you will spend more time and money on extra rent whilst you continue searching.

You don't sound like a very nice person but ultimately it's your money and you're free to do what you will. I hope many people aren't disappointed when you pull out and you do it asap. Some people will be losing their dream homes due to this. It happened to us.

I don't very often sit and stew about anything I read on MN, but I'm certainly doing that now. This defies belief. Shitty in every possible respect.

The only people who stand to benefit if you don't go ahead, OP, are your vendors' neighbours, as they will be spared having to live with a couple of CFs next door.

January to May is a long period of time. Things change. Who wants to be the poor person who buys the day before a market crashes? The Op intellectual abilities are just fine. I think there are a lot of emotional appeals on here from people who have had bad experiences-until a sale closes you should not expect anything- anything can change and that is what has happened here. Things change overnight. Markets crash overnight. Houses become worth a lot less than they were overnight.

Ignoring the 'high and mighty ethics', there's a good chance that OP is simply wrong about the money/likelihood of getting another place/where the housing markets going to go.

We bought at the height of the last housing wobble and everyone told us we were mad. The amount of money we've saved by having a mortgage over rent is incredible, and we're now deeply in profit.

I can see why the op would be nervous though, as mentioned upthread the market where I am had changed dramatically in the last few months.

If you think the house’s value has dropped by £16k in 4 months in Croydon (I don’t), pull out. You’d be an idiot to ask for £16k off. What do you think will happen to its value over the next 4 and 8 months?

Pull out and stay out until you think your market has stabilized.

While you’re doing that, you may want to reassess your house valuation skills, and the true value of £16k over the course of your home ownership period, as well as what a home really is.

People in chains get pissed off with this sort of behaviour because there’s always one who hasn’t truly thought it through, with maturity.

Well done for saving up for this home from such disadvantaged beginnings.

Houses become worth a lot less than they were overnight.

Only if something major happens overnight.

What's happened in Croydon?

Or are you just the OP with a name change?

Let’s be real, the true reason you want out is to gamble with the market. I don’t think you actually want this house but are using disingenuous stats to try and validate your decision, based on very little actual knowledge. You’ve clearly made your decision, what exactly did you expect people to say?

Would I buy it in your position? If I liked it, yes. Your 13k is made up and even if the market doesn’t look great, four months vs four years, the odds are you will come out on top. That’s a tiny proportion of the price. Put in a new bathroom and you’ll recoup that. If it was my money, I’d go ahead (and I’m not wealthy if that is even relevant).

Americanlife it is the definition of selfish. It's in no one else's interest other than their own and will seriously bugger things up for everyone else involved. It may be the right decision for OP to pull out, but it is an entirely selfish one.

I think your making a mistake OP. Your house hasn't dropped that much in that time, you're reading too much into quarterly figures. I also think you're making a huge assumption that you'll now be able to afford something in your preferred area. It is a huge amount of money so you should only proceed if you're sure, but it is a really really shitty thing to do.

If you were buying in Scotland you wouldn't be able to do it this late in the game, if you did you would be responsible for all your sellers fees that occurred as a result of your decision. Much fairer system if you ask me

I do know the London market. We are landlords of a place in a suburb and honestly I hope the market changes because it is disgusting that a young coupe in their 30's are being lambasted for having doubts about buying an ordinary home in an ordinary commuter town outside London.
Many people who are home owners in London are stuck in a smug little bubble and a basic understanding of economics points to the conclusion that the bubble will pop.