To think the buyer’s risk in house prices is not my problem?

[Eeksteek]

I’m selling a buy to let house to an investor. They offered below the asking price back in August, and so far as I can see, no progress has been made on the sale (I thought we were waiting for a survey, but last week they moved to a cash offer and now they are deciding if they want a survey)

The buyer emailed me yesterday to ask for a ten percent reduction on their offer, citing a potential 10-20 percent decrease in property prices and asking me to view it as ‘splitting the risk evenly between buyer and seller’

Firstly, the risk is not my problem. As an investor, it’s hers to take, or not, as she feels comfortable. Why should I share it? If I wanted to take risks like that, I’d be keeping the house. Secondly a ten percent reduction on the asking price is not a ten percent reduction on the offer, lady. And thirdly, a ten percent reduction in agreed price is an ACTUAL HIT to me, not a potential one. It’s not a even comparison!

She has also said that if I accept she will instruct her solicitors to proceed ‘as expeditiously as possible’. Well, why hasn’t she done that already? I’ve instructed mine, and paid them, and completed all the paperwork. She also smugly reminded me that she is a cash buyer, and not affected by interest rates.

I feel like writing back and saying:

1. The risk is hers to take or not. It’s neither my business or my problem.

1. If she wants to reduce her offer by ten percent then say so. The asking price is neither her nor there, as she didn’t offer it.

1. Inflation is running at around ten percent and forecast to rise. Her cash is already losing 10%. She swapping an actual 10 percent depreciation rate which will always be a depreciation, for a potential one which will likely be a gain over time. I am doing the reverse. (Although I suppose she could counter that with interest rates)

1. She is also benefitting from a (I think) five percent reduction in stamp duty. Shouldn’t we be sharing that, as well?

Obviously, I can choose whether to accept or not, and ultimately is doesn’t really matter why she’s reducing her offer. I do have some bargaining power. I bloody hate this sort of game, but I really, REALLY need to sell this house. God knows if I’d get another offer. It’s making an ever increasing loss, and is on a variable rate (couldn’t fix, as selling). Should I just suck it up, negotiate, or continue being silently indignant (which is obviously not very productive!). I really do need this money. I’m widowed and this business supports me and my child. It’s not paper money. Or just not having a holiday or a new Range Rover!

Your numbers are way off. It's a maximum saving of £2500 for any buyer.

Make sure you use the correct maths, otherwise it just makes you look incompetent and puts the other party off from continuing negotiations.

Owning a spare house is not a Buisness. You're a parasite. HTH.

I didn’t calculate it. I ran it through the .gov calculator, and just changed the date to pre and post fiscal event. But £2500 is less than one percent, so that doesn’t seem right to me. She’s going from roughly from 8 percent to roughly 3.

What was the interest like when the viewings happened?

Gosh, thanks for you help. I never realised that. I really appreciate your good wishes.

For your information, the houses were left to me by my dead husband, to replace his income when he was gone. It is both run and taxed as a business, and provides a family with a safe and nice home, means we need no benefits and allows me to care for my own child. Not terribly parasitic, I’d have thought, but whatever. It’s attitudes like that, tarring all landlords with the same brush, that means the good ones are selling out to corporate landlords. And they really are bastards.

Don't be so spiteful. You don't know the circumstances and its none of your bloody business
HTH

I know, and you’re right. I’m much more affronted about her silly reasoning than her trying it on. But I want her know I’m not as green as she seems to think!

I would accept 5k off - I want to move faster, and I’m prepared to take a hit to do that. I would have to be VERY sure of her as a buyer to take 10k, and as things stand I’d remarket. I think I could get £265k if I remarketed, but the delay is a factor.

It’s a very common attitude. Oddly enough, no one I know in real life things I’m a bastard. It’s a very clever propaganda by the current government to scapegoat small landlords, while the real sharks hide being companies. I’m sorry people are take in by it, and I really hope it doesn’t backfire. There are some very valid arguments against having multiple houses, but there are also always going to be people who don’t want to or can’t own houses. And if you want Jacob Reece Mogg Ltd as your landlord, have at it. I’d rather have a widow supporting her family and maintaining a excellent house, but to each their own.

HNRTT but my short answer would be 'no' or, as you say, to counter-offer to complete for a share of any stamp duty saving. A longer explanation demonstrates weakness.

Good luck.

I would say no because she might try to push you further.

Stamp duty is taxed in bands. Similar to income tax.

Previously it was 0% up to £125k and 2% between £125k and £250k.

Now it's 0% up to £250k.

Everything else (i.e. rates above £250k and landlord additional rates etc.) is the same as before.

So maximum saving is 2% x (£250k-£125k) = £2500.

The housing bubble is really not about to pop.

We have a shortage of housing here in the UK.

Might stagnate, but won’t pop.

It is both common and unfair.

And misses the point that, without a supply of willing landlords, rents would rise. As they have been doing in London. They're seen as the scourge of the property market, rather ignoring the fact that they provide a service and aren't the main reason for prices rising.

Being able to type a comment, doesn’t mean you have a well functioning brain.
You’re an utter numpty.

HTH

Ah, I see our old friend the poster who thinks it's OK for her to rent off a private landlord but not anyone else has found this thread.

My view, as I said previously, is that she's buying your property under current circumstances. Prices haven't dropped at all where I am. If she thinks prices will be lower in 6 months/1 year/some other unknown time factor then she needs to buy property then, not now. But rather like the people who said brexit, or covid would cause a big fall, she's likely to lose out long term.

I would also doubt her claim to be expeditious, if she's done nothing since August - not sure why you think she's going to be a proactive buyer! But if you want to sell to her, add a time penalty - house will be this price until x date, after that it's back to the original offer. I still think you should put the house back on the market though. Good luck with whatever you decide OP, it is a very stressful time.

If you say no, you have to be fully prepared for her to walk away and for you to be back to square one.

OP sounds like a nicer individual than you. HTH

That's a dumb and simplistic view.

There's a genuine and significant demand for rental properties (not everyone wants to buy, especially when rising mortgage interest starts to exceed cost of renting).

If there weren't landlords renting out their 'spare' houses, all the people renting would be homeless.

The argument is that if landlords sold up, rental properties would go back into the owner occupier market, and house prices for Joe Average will fall.

Only rental stock is estimated to be down 50% since covid, and house prices have not only failed to fall, but continued to rise. And rents have risen horribly. So it doesn’t seem to be a significant factor. I’m absolutely happy to have a robust debate about it, but you can’t. The Landlord=parasite is impossible to get past. Oh well, it isn’t me who will have to doff my cap to JRM and co. I tried really hard to engage with people over it, too.

And you're a grade A bitch. HTH

Has she responded yet OP?

She’s back with 5% as expected. (Which I think is what she really wanted) and that she will forgo the survey (blimey. I wouldn’t risk that!) I have fired back with agreement, if exchange is in no less than four weeks and she takes the sitting tenants (which is what I really wanted.) My conveyancer says searches should should be possible in the time frame. If she agrees, I will ask for proof of searches submitted by the end of the week or I re-market.

I was brief!

Well done OP. I hope she proceeds quickly and you have it in the bag in a month.

I recently sold my house, and point blank refused to sell it to a BTL investor. Bloody parasites.

Yes, yes, landlords are bastards. We’ve covered that upthread. Thank you.