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!

No wonder FTBs cannot afford to buy given the amount they waste on aborted attempts to buy a house

I thought it was all the avocados??

TatianaLarina

the exercise was to illustrate that prices are dropping a lot in a short space of time. I don’t think there are many parts of London where house prices haven’t doubled in 15 years.

Stressed Avocados cost £2 mortgage arrangement fee could cost £5000.

The flat we sold 3 times to FTBs the EA when we were talking reckoned that between the 3 FTBs who failed to complete. With all costs and extra rent they wrote off between them nearly £60,000. They were all still renting when we sold for £20,000 more to a landlord who rented the place out.

betty if it is that house it's a smashing one!

That isn't taking into account that the 1 bed FTB flats in the area were now £20,000 more.

Exactly! London prices have roughly doubled in 15 years despite the financial crisis of 2007 at which point prices dropped in exactly the same way as they are now in the short term, yet continued their inexorable rise long term.

To stressed ^^

So the escalating prices were nothing to do with lower interest rates & previously much more relaxed lending?

I think what has happened here is that this never was the right house for you, it was a house and it kind of made do.
This whole thing with the house prices is really just an excuse to pull out.

I agree that it is a monumentaly shitty thing to do but why should you move into a house you aren’t happy with just so you don’t duck people off?

The more I think about it, price aside this was never the house for us.

So you waited up until the eleventh hour to say “ I don’t like it” because you’re a selfish, thoughtless flakey twat!

sunshinesupermum I thought so too but thanks to Findo 'BeakyNose' Gask my post was pulled despite also having a relevant comment for the OP! Shock horror! Poster uses the internet to look stuff up!!
I was hoping that if it was that one, the current owners, or someone that knows them, might see & would get a heads up on what sh*tty move the OP was about to pull.

@SpandexTutu so you think that pulling out of a 4 month deal at the 11th hour would be acceptable for your DD to do if she were in the same situation. I wonder how you would feel if your daughter was the vendor, had spent time and money on conveyancing and EA fees, booked a removal firm, maybe changed jobs, maybe arranged for kids to go into new schools and a buyer who 'changed their mind' pulled a fast one on her. Doubt you'd be so pragmatic.

The financial aspects aside (even though you have said that this didn't impact your decision...even though you directly said it IS the reason for pulling out ) - wanted to have a bit of security before children this statement, followed by then saying you won't move for another year, then that you will move abroad in 4 years...NONE OF IT MAKES SENSE. It sounds like you have just fucked around with the idea of buying but had no serious intentions, and are about to epically screw one or more families over. Very arseholey and shameful behaviour. You have no idea when or where or what you want to buy and have led people down the garden path, and your answers on here are very flippant and nonsensical.

betty Am sorry your post got pulled for no good reason. Some Mumsnetters leave me gobsmacked.

I hope OP returns and lets us know what she has finally done - pull the plug or gone for the reduced price.

If house prices had dramatically increased and the seller got a higher offer, a lot would just dump you.

I suppose it depends how much you want the house? If you’re not struck on this one and don’t desperately want this particular property then pull out.

The price within those paramters don’t matter that much if you love so are staying for 20 years, but if you plan to move on quickly then I’d pull out.

crispy Heaven help us if all 30 year olds who are doctors have the same attitude as the OP. Really needs to grow up and learn some empathy before going out into the big wide world of medicine.

so the escalating prices were nothing to do with lower interest rates & previously much more relaxed lending?

Prices have been escalating since 1973. Lending has been relaxed since the 80s (compared to other European countries). Interest rates and lending trends impact prices but the overall trend is up.

(In London that is).

I’ve never disputed that house prices have gone up. My point was I don’t believe they can keep going up in the same vein as a number of factors escalated the growth.

S0upertrooper - I have bought 6 houses over my life and had buyers pull out, offers lowered based on survey info and as the market dropped etc. I've had problems with buyers still showing people round after they have accepted my offer because they were still looking a for better one. I've dealt with blatant lies, subsidence; the list goes on... and on...
I've just been through a house move with my mum where the EA would phone up and threaten her (in her 70s) on a weekly basis.
So I've had my share of house buying grief. It is a shit system.
But blaming the OP for being aware of a falling market and taking steps to protect herself is unfair.
OP did not know 4 months ago that prices would fall like this. She's not exchanged contracts so she can pull out. She's not broken any laws, just taken reasonable steps to protect her savings.

My views may be coloured because I was in my late 20s during the 10 year dip in the graph in the late 80s-90s. I rented in London for almost a decade and it was much cheaper than owning with none of the ties, sunk costs and risks. Price rises during the 70s and 80s are not comparable to the last 20 years because of very different rates of general inflation. If anything the graph actually highlights just how out of kilter the last 20 years in London have been and how unsustainable they look going forwards.

My point was I don’t believe they can keep going up in the same vein as a number of factors escalated the growth.

I know you can’t. But as someone who has lived in London for nearly 50 years we’ve experienced this disbelief continuously since the 1970s.

It’s harder to get a mortgage now than before the financial crisis, 90% mortgages were not uncommon then, and everyone felt before the crash that prices couldn’t keep rising. But prices have already passed 2007 peaks.

100% mortgages were not uncommon then! 90% is OK even now.

The crash was 2008 really. However, house prices in London have long eclipsed those levels.

I think the OP does not really know what they want. Like many in the NHS, they want out. They want a foothold in the housing market. They want a better house in a better location, and now think they can get one after the market being awash with houses that are not selling. It is all a bit hopeful but they cannot be made to continue with the purchase. They will not be the first or last to do this. Of course its financial - its geting the best for your money.

My views may be coloured because I was in my late 20s during the 10 year dip in the graph in the late 80s-90s. I rented in London for almost a decade and it was much cheaper than owning with none of the ties, sunk costs and risks

And none of the investment. I remember that plateau, it meant I could buy a London flat in ‘93 for 90 grand with a deposit courtesy of my grandmother’s will. I sold it this year mortgage free for 860 grand. It’s never cheaper to rent in the long run.

@SpandexTutu I have no doubt you have had these experiences, like many with a history of buying and selling. However your point was that you would be happy for your DD to take the same action as the OP and my point was to ask if you would be happy for your DD to receive the same treatment as OP's vendor. The vendor may be someone else's DD or DS. If the OP so convinced that the house value has dropped so dramatically perhaps she, and others like her should pay for subsequent valuations to back this up.