AIBU to walk away from this house purchase?

[Quandaries]

Will try to keep this short.

Viewed a house and loved it 6 weeks ago. Ticked all the right boxes and was very good value for what it was. Offered asking price and it was accepted. Survey done, solicitor engaged etc so at the stage where it’s cost us some money.
Booking deposit has been paid but is refundable (not in Scotland).

We have a large deposit and mortgage is ready to draw down. We’re not in a chain.

Our solicitor was chasing theirs for contracts.

On Thursday I got a call from their agent to say they’ve allowed another viewing from a very insistent couple who are cash buyers and offered £8k more.

Agent now wants us to reoffer and increase on the new buyers’ offer so we’ll be paying £12k above what was agreed. He insists that the house will go for even more if it goes back on the market and says that houses are being snapped up before they go on the market as more people are working from home and this village is very popular for those with just an occasional commute.

I’ve had a look at Right Move and can’t see any evidence of anything other than price drops in the area. I accept that there may be houses selling before hitting the market and I don’t have this data.

My heart loves the house. It’s in a stunning village and really ticks all the boxes in terms of schools etc.

My head is saying we’re actually in a better position than the cash buyer as we’re 100% ready to go and can sign this week whereas they will need to have survey done etc.

Head is also telling me that if the sellers are going to screw us for £8k (for context, that’s a bit over 1% of the purchase price we had agreed), they’ll be a nightmare to deal with and it’s only a matter of time until they come back to us either with a new offer from the other bidders, or pushing to put it back on the market.

I’m also guessing that house purchases slow down a bit in winter, and it’s an area where more Covid lockdown measures are likely so putting it back on the market may mean there aren’t many viewings.

For additional context, we can afford to increase our offer. I’m just loathe to get into a bidding war due to how the vendor has sprung this on us.

But I love the house.

YABU- up my offer
YANBU- walk away

Any chance the EA knew you would go to that extra amount and has let it be known?

I don’t think he knows enough to know what our top budget is. We’ve been very cagey with figures and haven’t given any indication of affordability in terms of deposit etc.

Neither of us are big social media posters, and our names aren’t especially unusual so I don’t think we’d be easy to track down. I’m on LinkedIn but my job title is one of those ones that would give you no idea as to what I do or how much I earn. DH’s job title would probably give an indication of likely earnings but he’s not on LinkedIn or his company’s website.

Anyway, I spoke to the EA this morning. Outlined my disgust at the vendors’ behaviour and gazumping. I’ve made an offer not of £8k, but of £7,750- a 1% increase on the price we’d originally agreed.

Offer is valid until 5pm today, so now we wait.

OP what is a booking deposit as mentioned in your OP?

Who sabotaged the survey?!
Why on earth would the vendor sabotage the survey - they stand to lose.

Maybe they hid or downplayed negative aspects or refused access to what they knew were trouble-spots - i.e. stopped them from doing it properly and arriving at a fair (significantly lower) value rather than outright preventing them from doing the whole survey?

Good for you, OP - hoping for good news. I think that's a measured response, taking everything into consideration.

Hope that works @Quandaries. If it doesn’t this house is just not to be. Fingers crossed these bastards see sense.

I do wish people wouldn't be so blase about large amounts of money when it comes to buying houses, just because the cost of the house is extremely large.

If a house is worth an agreed £800K, that's the amount that has to be found and paid in exchange for it; but an arbitrarily-demanded/requested/advised additional £8K, £12K or whatever on top, on the basis that you're already spending a huge amount so the extra is therefore not much money, sounds all wrong to me.

Even if you discount any interest charges on borrowing it upfront, £8K over 25 years is an extra £25+ every single month. I know that those in the market for an £800K house are unlikely to be on NMW, but is losing an extra £25 on a relative whim for every single month for 300 months really considered as of no consequence?

@Hingeandbracket

OP what is a booking deposit as mentioned in your OP?

A fully refundable deposit given to the EA at time of offer being accepted. It usually ranges in the area of 1-2% of sale price. The idea of it is that you’re not shopping around and just putting offers on loads of houses to later pull out of most of them.

I’ve done this every time I’ve purchased a property as have people I know. Didn’t realise it was a universal thing.

Thanks - I haven't bought a house for 14 years so it may be things have changed in that time.

It’s not universal and I’ve never had to do it. Most people selling a house to fund the next one can’t pull 1-2% of the purchase price out of their back pocket, we most definitely couldn’t.

Walk away

In the 1988 boom when I was trying to buy a flat, the estate agent tried to sabotage the survey.

Flat vendors were buying a new build, and the builder told them if didn’t exchange by x date, then their house would cost more, and the vendors said I had to pay £10k more to cover this (25% of flat purchase price).

First survey attempt, surveyor arranges with estate agent to be let in, no one there. Second time, I ask surveyor to collect agent’s key from their office (round the corner from the flat) if no-one in. No one in and “lost key” at estate agent. Third time, I find out from surveyor when survey re-arranged, (he’s getting pissed off), I confirm with estate agent that someone will be in and estate agent has the key to hand just in case. Bingo!

Then I had to hassle the surveyor for his report (very pissed off) take time off work to collect it and drive it to the mortgage providers before they shut (wouldn’t accept a faxed copy), and then hassle my solicitor re exchange.

I think the estate agent tried to delay to get a bigger fee.

How odd, I've never done a booking deposit.
Where I live I get the impression the EAs would know if you were putting multiple offers on without telling them!

Good luck OP! I've learned a lot from reading this thread.

Oh and I had to give the estate agent a booking deposit, when it came time to pay the solicitor the balance, the estate agent had “forgotten” to mention it to them and yet more paperwork delay.

I voted YABU because the cash buyer might not even exist. If there is only one week for exchange and your deposit is refundable (are you sure about it? Our exchange and completion was on the same day so maybe yours is different!) I would wait having nothing else to lose and I would tell the EA what you said that if they want to wait longer for more surveys for 8000 more it's up to them and you are not offering more and see how it goes.

I would go back to the seller's agent & negotiate your positives - you're ready to go, you have capital in place etc etc. Sell it.... Gauge response.. personal if I loved the house & I could I'd up your offer maybe a bit, but on the back of 'the contract must be exchanged by X date'.
They might be after a bit more money but I'm willing to bet that there probably is another buyer.

@Quandaries
Just re read your update I feel like you've done enough to secure deal. I admit if I'd loved the house I'd have probably done the same as you.
Please keep us updated?!

If you totally love the house OP then I think you did the right thing this
morning.

But I wouldn’t be playing any more games. If they accept this then do all you can to lock them down.

If they won’t then walk. The resentment at their cheek will gnaw away at you.

I hope they accept the offer. There was no reason whatsoever why you should offer 12k and not match the gazumpers.
Meanwhile have a look around for anything else you fancy. If you see anything then go for that instead.

@WeBuiltThisBuffetOnSausageRoll

I do wish people wouldn't be so blase about large amounts of money when it comes to buying houses, just because the cost of the house is extremely large.

If a house is worth an agreed £800K, that's the amount that has to be found and paid in exchange for it; but an arbitrarily-demanded/requested/advised additional £8K, £12K or whatever on top, on the basis that you're already spending a huge amount so the extra is therefore not much money, sounds all wrong to me.

Even if you discount any interest charges on borrowing it upfront, £8K over 25 years is an extra £25+ every single month. I know that those in the market for an £800K house are unlikely to be on NMW, but is losing an extra £25 on a relative whim for every single month for 300 months really considered as of no consequence?

Honestly this is just rubbish. It's actually not that much money and just because a house is valued at X amount, if two separate people want it, you have to bid more. It's as simple as that.

@Quandaries

If you really love and think nothing equally as good will come up then hold your nose and pay it.

I’d say that there are so many headwinds facing the property market at the moment, that you may be better selling up and moving into rented for 12 months. In 12 months time, you may be able to afford something better for less money. Even the most conservative of forecasters are predicting drops of 5-7% over the next 12 months, some forecasters are predicting higher drops.

I'd walk away on principle. I know the law doesn't protect you at this stage, but wouldn't it be fair if they had to reimburse you for monetary losses after accepting an offer? I don't know what their circumstances are and it could be that I'd be sympathetic but they'd still be quids in and you'd be compensated.

It has happened to me. £400,000 offer accepted, taken off the market, and two weeks later they had an offer of an extra £17,000 from a previous viewer. We walked away. Bastards!

Took great delight when they called me five months later saying it had fallen through and did we still want it. It was the day before we completed on something much more suitable!

So by taking a "booking deposit" who is the estate agent now working for ? The vendor. Or the buyer ? What does that fee secure for the buyer ?

It’s supposedly a holding deposit for the buyer the show good “faith”, so more money to lose on top of survey and legal fees if you don’t proceed.
You don’t legally have to pay it, estate agents sort of give the impression if you don’t then the vendor won’t think you’re “genuine”.

Don’t know if there’s a perfect way out of this for you now. A couple of years ago, I paid 20% more than EA valuation to buy a house and stop it going to open market. I was blinded by the fact it was my dream, forever home and didn’t want to take the risk of loosing it. There was no other bidder. I don’t know if I regret it or not - still love the house but know that I overpaid if that makes sense??