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!

You have to take a lot of leaps of faith when relocating. Quibbling over percentages leads to more problems than it solves. Dealing fair and being decisive is best on most occasions.

You're 30 and want to buy a secure home before trying for a family. Why on earth would you then choose to fuck about renting for another year or two when you're about to exchange on a good family home? The years go by fast. Remind yourself of all the positive reasons why you offered on the property in the first place.

Hope you don’t find yourself struggling to get on the property ladder at all in a few years due to changes in circumstances and the market and wishing you hadn’t given in to nerves now.

And yes I too feel very sorry for your vendors.

I was gazundered, for less than 13 grand but they had me over a barrel. Cunts. That's being kind.
It's on a par with promising you'll take your kid to Disneyland then telling them it was a joke.

Awful behaviour. Frankly cruel to pull out at this point. The house prices in your area can't have changed much in 4 months. And whenever you buy there's always a chance that the market will change and the house will de-value.

If you do pull out the very least you should do is offer your seller some financial compensation for costs incurred, which probably will even come close to compensate them for the heartbreak of losing the house they wanted to move to.

OP - you asked for abuse and you got it ;)

TBH I think the responses you've had are a bit unfair. Yes it's it's not great for the vendor, but equally a 26k drop is pretty dramatic.

What has your mortgage lender actually valued the house at? If it's really gone down that much they may not lend you the money anyway? And if they did, who wants to put themselves in a negative equity position straight away? What if you couldn't pay the mortgage, have to sell and the sale wiped out your deposit?

It's a rubbish situation but I can understand you don't want to really disadvantage yourselves financially. I don't think splitting the difference is a terrible solution - perhaps explain to them what it would mean for you and the risk of buying a house for 26k more than it is valued at?

Totally shitty behaviour. Your word ought to mean something. As has been pointed out, if the market was rising, I doubt you'd be offering more.

If you do this, I hope it comes back to bite you in some way in the future.

You'd be an utter idiot to wait till next year hoping the market drops. Croydon is a pretty bloody good investment right now.

It'll cost you a damn sight more than £400 given that you'll be in rented so much longer.

You will kick yourselves this time next year trust me.

How much is your rent op?

You know this wasted money right?

I used to work in EA. You really should have said something sooner. The chain will break, costing the others in the chain money they can Ill afford to lose. You have already offered 20k less than the asking price. Whatever people get for their property determines the price they pay for their house purchase. You will be asking the seller, for another 10k price drop, making 30k in all.
I understand how hard it is for FTB's, you could always try dropping the price, but be prepared for them to give you an emphatic NO.
EA will more than likely have a list of interested parties in properties. If the prices have dropped, as you say, hopefully they will soon find another purchaser, but if not, your selfishness will have cost people time and money they can I'll afford to lose.

I don't think splitting the difference is a terrible solution

a week before exchange is not the time to mess people around, it's when you have the survey results that you can renegotiate.

The sellers have made their offer on their next purchase based on their selling price. They may - or may not - have no leeway whatsoever and will lose their own sale by reducing the price.

The OP is not that bothered about the sale by the sound of it, so why oh why starting the whole process in the first place!

My prediction is that you'll pull out, cause misery through the rest of the chain, spend on rent, wait to buy next Spring, prices will have risen in your desired areas and you won't be able to find anything you agree on to buy anyway.

I'd put money on it.

Op all of these people saying how terribly rude and think of the other people etc etc - well YES it's not ideal, and a crap situation but for gods sake if you're really sure that you've offered over the odds then pull out.

It is a lot lot lot of money, don't get yourself into debt on something you may lose a tonne of money on.

Do you like the house?

Does your DH like the house?

How long do you intend to own it?

Isn't a better way of looking at it is that you already had a £20k discount from the asking price, so even if it were actually worth £13k less, you are still saving a further £7k.

Oh, that is seriously bad form OP.
YADBVU.

I have had someone do this to me .. right at exchange. Backed out. Said they would only go ahead if I took lower price. Royally screwed me over.

They will have to pay their solicitor to have not sold to you. Pay they to not buy the house that they had planned to.

Nice how people feel it's okay to fuck people over and waste their damn time!

This would be hilarious if it wasn't going to cock up however many other peoples house moves.

Next year, you'll be wanting to give the market time to settle after Brexit. Or you might want to give the market time to settle if Scotland goes independent and companies relocate to England and bring house buyers with them. Or you might want to give the market time to settle if the government goes arse over tit and there's another election. Or maybe Trump will be impeached. Or, or, or.

If you want to buy a house, buy a house. It's somewhere to live. Fuck the markets, really.

OP, I'd read @PetulantPolecat post 10 times if I were you....England is about the only country in the world where it could take 4 months between agreement on price (which I assume was agreed on the market price at that point in time) and exchange. If the market price changes substantially between verbal agreement and exchange of a legally binding contract then of course it is not wrong to consider changing your offer. And that applies up or down...to houses and anything else. Unpleasant and highly inconvenient for the seller....or potential negative equity for you. But I don't see why the seller's requirement to achieve what is now well over market price should trump yours to purchase at current market price. I would have a very open discussion with them and ask their opinion before making a decision...I'm sure they are also fully aware the market price has changed.

Wow. I’m not even a potential homeowner and I think that’s such a really awful thing to do.

Only a week to go til a whole chain of families move. Moving companies will be booked, boxes starting to be packed or already packed, kids getting excited and/or nervous, maybe they are moving away from friends and family and saying goodbyes, and then YOU happen.

Wow.

But YOU’LL only lose about £400 so never mind eh?

You are hateful people. Seriously

The simple truth is that you don't want the property enough. If you did you'd stick to the original offer.

From your last post you've basically realised that now you can afford something in your desired area so you're happy to screw the vendors over.
I really, really hope that when you come to look next spring that this is no longer the case as that is exactly what you will deserve for being such a cunt now.

You have already asked and agreed on around 6% off so I can’t see you getting the other 3% reduction. If you want to walk away from it that’s your choice. Crappy thing to do to the owners but your within your rights to. If your planning on making a quick money maker I would agree walk away but if the plan is to live there for a few years the market value now will have no reflection on what’s to come a few years down the line. If you think the house has potential and you would be happy there for a few years I would say buy it and make any changes you feel appropriate to increase the sale price when you go to move

How would you feel OP if prices had gone up £25k and buyer was asking for more?

Absolutely vile thing to do which should be illegal.
We had our buyers pull out 2wks before (and while we were on holiday) I was heartbroken. It cost us a fortune, we lost our new home and the deposit we’d paid (new build plot reservation fee). All our stuff was packed. The whole chain collapsed.