Scared about buying house, should I reduce my offer? :(

[falaff]

Hi all,

I've had my offer accepted on a house. I love it and it ticks all the boxes. I paid over the top end of the asking price but I'm in a very competitive area (last house had 40 viewings!). I plan to live there long term (at least 5 years). My job isn't at risk, I'm a first time buyer with a 60% mortgage, and it's vacant posession so most things can go ahead in line with the government guidelines.

I'm not too worried about losing money in the long term, but I am REALLY struggling with the decision whether to proceed. My friends think I'm mad to buy now when I could wait for 3-6 months and potentially buy a similar house for 30k less. I don't know whether to listen to them. I feel like perhaps prices may not drop so much in a high-demand area, and if I don't buy now I could be waiting a year for a similar house to come up.

I was thinking of perhaps reducing my offer and discussing sharing the risk with the vendor, so for example if prices may crash by 30% then to ask for a 15% reduction. But there were 5 other people with offers in too, one of which was higher than mine. I don't know if any others have as good a deposit though. I've been burned before by being cautious and lost out on another house as I didn't move fast enough, so I've felt really pressured.

I have saved hard my whole life to have a 40% deposit and I would be gutted to think that I could have saved tens of thousands and used that money in a better way.

I can be a very impulsive and emotional person, so whilst it's ultimately my choice, outside advice is important for me to get some perspective.

Any advice? If I try and renegotiate could I will risk them withdrawing the offer?

Also what makes it worse is seeing properties you could have bought if you had waited, bigger, better, nicer area for the same money.....the property market is either going to flatline or fall in the short to medium term it’s not going to go up, you will find another house which is a safer financial bet.

I think this is it, I have some really specific requirements for what I want and managed to get this one on one of the streets that I wanted to live on, so I feel really lucky. I would be really sad to let it go.

It's a really popular area and I think there is something in the popular areas possibly maintaining some sort of stable value.

I am also in a really crappy flat, which is saving me money, but it's single glazing and no heating, has mice and noisy neighbours, no kitchen space and is just really not a cosy place. I'm getting pretty desperate to get my own house now, but I do fear that this is clouding my judgement.

Thanks for the advice on surveying - I'll look into it properly tomorrow. To be honest I have been so overwhelmed with everything - I've been trying to work from home and I'm just useless. It's so hard to stay motivated and positive.

The 25% slump would be painful but it wouldn't put me in negative equity, so really I would be OK. But it would be very, very hard saying goodbye to savings that have taken me 20 years of constant saving to build up. I can equate a 25% drop (that I might be able to avoid by waiting) to several travelling holidays and campervans!

I think I need to think about my specific requirements and whether something as good will come up, and I think it's hard to find that anyway, nevermind with a huge reduction in available properties. I experienced a similar thing over Christmas where no houses came on the market, and then when they appeared again there was such demand that everything went for at least 10k over asking on 150-180k houses. One I ended up not even bothering with had 60 viewings and went for 25k over asking .

My concerns if I were moving would be:-

• How safe is my job, thus my ability to pay the mortgage
• If house prices do dip because of a lack of confidence in the market, will I end up in negative equity

And, if the house needed work

• Who is actually going to be allowed to do this
• Can we live with it in the meantime

@BettyBooJustDoinTheDoo I hear you. I did feel this when I lost out on the first house I thought I secured in October. I thought that was it, I would never find one as perfect and for that price (it was very, very cheap) but here I am with a better one. Albeit 20k more, but it's a lot nicer.

It's just a terrace, but that's kind of what I want right now. It's on one of my chosen streets in a sought-after area in Sheffield and is larger than standard (over a ginnel) and the garden is big for a terrace too, both of which are set requirements for me. It's in good nick as it was a rental, and is ready to go. I really liked the idea of a fix-me-upper until I got a full time job! Anyway, the house is quite specific, but it's not a one-off.

So yes, there could be a similar house in a few months for a lot less. This is why I'm worried. I know if I let it go I will find something eventually, but it might not be the same. Or it might be better. Arghhh!

You need to stop thinking short term and starting thinking medium-longer term. You said you were planning to stay in this house for 5 years? So what's the problem? Even if house prices fall now, when coronavirus and Brexit are all done and dusted, prices will go back up again. So any loss you make in the short term will correct itself. And it's just a paper loss until you actually decide to sell.

@Bearbehind, I asked my boss about job security and he was very reassuring, and I won't be in negative equity. I will lose a large amount of cash though and that is really hard to comprehend. I think I need to stop comparing what I could have if I didn't spend X amount, as it doesn't always work out that way.

It doesn't need any work but of course that depends on the survey. I thought that the government said that work in private houses could continue, but I can't seem to keep ahead of all the changes.

So I think in the long term I'll be OK. It's the short term impact that may have a really bad effect on me and that could be either way.

If it hasn’t been surveyed yet then I think there’s going to be a pause in proceedings anyway

@HundredMilesAnHour I understand that and I am trying to change my view. I think it's the potential of buying a house for 170k now and using all my savings as opposed to the potential of buying a very similar house in 6 months for 150k and having 20k left in the bank. It's incredibly daunting and anxiety inducing, particularly when I've been very restrained and careful for much of my adult life. It would almost feel like that extra saving and not going on X holiday or buying X item was a waste of my younger life. Probably a bit dramatic but I am an overthinker!

OP, at the end of the day it’s entirely up to you but the facts as I see them right now are:-

• no one can predict when this will end

• no one knows how long it will take for consumer confidence to return

• unless you are a key worker, you don’t know how safe your job might be

• if huge swathes of people are out of work due to a lack of consumer confidence in industries like non-essential retail, tourism, hospitality etc then house prices will fall

As others have said, if there’s literally no chance of a similar house ever coming on the market then I’d maybe proceed but otherwise, there’s not a cat in hells chance I’d be buying a property right now

We are in a similar position. Offer accepted and agreement in principle, now worried we won't get a mortgage because of the economy.

Also would like to offer a lower price than has been accepted, not to be cheeky, but because of the uncertainty in the future. This is over ten years of hard saving (first property) and it's a LOT of money for us. Any money we can save would help.

Also considering just pulling out altogether, we haven't a clue what to do.

I would buy it. It's what you want and you said yourself not much comes up where you are. I was looking during the financial crisis in a particular area and as it was a nice area people could afford to hang on for the price they wanted or hang on and not move for a bit so very little came up - there was very little price drop there at all and they rebounded quickly.

I've just read a report today that said with the quantitative easing going on there will be a bust in the property market but a quick recovery as other conditions are right - lack of supply etc. Do some research into this on your area.

Also, you might end up renting another 18 months worst case scenario and have to accept a property that you don't want as much. What will 12-18 months of rent cost you?

Also when you come to sell a few years down the line perhaps other houses will have come down in price, or stayed stable, if yours has too.

I don't want to push you to take a risk but it's the nature of the game. If your job is secure and you can afford it and you really want it buy it. Worst comes to the worst you lose your job and rent it out.

The RICS used to have loads of charts I'd pour over to look at house price inflation in certain areas. You can then see how quickly prices have recovered in areas and how long the slump was. Have a look at the financial pages of some news papers to see what people are saying - Google the RICS, ask local estate agents (although take with a big pinch of salt), see what property specialists like Savills and Knight Frank (?) are saying. Of course they might be unrealistically buoyant but they might have some information you can glean on the economy etc to make a decision.

Do you have a date set for exchange?

I would still go for it rather than pay rent on a crappy flat for another 12-18 months.

You will never buy anything with this mindset

Stop messing people about

You said yourself it ticks all the boxes.

Buy it or don't but make your bloody mind up

Buying a house is stressful enough without all of this covid-19 stuff going on. You've said that you are looking for a long term home...you've worked so hard to save money and you're in a really strong position and you have found a home that you can afford that you like. So consider the risks....the highest risk is that your home might drop in value...so you'll lose money. The other risk is that you scare yourself silly and you walk away from a house you love. Losing money would be a massive concern if it were a short term investment...but it's not is it? This is going to be your long term home! Buying a house is the most frightening investment I ever made. Get the survey...make sure your bricks and mortar investment is sound. Then if you love-love-love it.....take the risk. Chances are in 10 years time you wont be in negative equity....but if you are??? You still have a roof over your head that you love. It's my simplistic take on a really complex situation...but do what ever makes you happy. Often, it's where we live that makes us happy.

@AnyFucker pretty harsh... it's not like I'm umming and ahhing about some curtains - this is the biggest decision of my life and tens of thousands of pounds. I would be very foolish not to be considering the effects of a completely unpredictable potential economic meltdown.

And I'm not messing people about - I haven't done anything yet, I'm asking for advice. People renegotiate all of the time with changing circumstances which is what a survey is for.

Things are rapidly changing and are different now than when I had my offer accepted, so I need to consider how that my affect me.

Consider away but you might find the vendor tells you to shove it

Agree with @AnyFucker, the buyer for my house has decided to dither at the final hour and as a result we are going to have to take the house off the market.

You aren't in a position to negotiate down at the min. Get your valuation survey done and if that's lower than the offer price, that's when you negotiate. Otherwise you are just likely go annoy the owners and they sell it to someone else.

Sometimes you just need to take a bit of a gamble. We bought and everyone was saying 'hold on, prices will drop, more will come on the market in September' but we found the house we liked and had an offer accepted.

We proceeded and I'm bloody glad we did, as the market has been dead around here since. There never was the influx of new properties, and house prices have remained stable but houses have been bloody hard to come by because there are loads of buyers for each decent property that comes on.

What I will say is I was you vendor, I'd be telling you to sod right off if you tried dropping the price now or spent ages stalling - particularly if I'd had other better offers!!

Just in the survey point - we are selling and buying and the survey on our house had been planned for this Tuesday gone, so was cancelled after the lockdown announcement. That was that I thought, no progress until things relax a bit. However the surveyor got back to me later in the week and said he thought he could do it, obviously looking at the outside is fine, and then he wants me to go out for a bit so he can go in and look at the inside.

So I guess it depends on the surveyor - I don’t really know what the rules are for them, but I suppose I just have to trust that he knows what he’s doing? I really can’t see what the risk would be with an empty house.

We are still keen to go ahead with the purchase of our new house even though it’s upsizing as we intend to be there for 20+ years, the mortgage has been approved and we both work in fairly secure industries (medicine and accountancy). Prices may reduce a little temporarily, but the supply of housing in our area has been awful for months so I think that factor will mitigate any huge falls in the market- and as we want to be there long term it’s not really an issue anyway.

CaptainWentworth, which lender is this? The house we're looking to buy is also empty and they suspended all physical valuations for 3 weeks without exceptions. (virgin money)

OP, I would go ahead, buying a house is never easy and although the recession is more than likely you'd probably be better off to weather it in your own house.

TBH, you can waste a lot of money on the wrong mortgage. 25 years of interest at too high a rate is a lot of money. I would speak to a morgage advisor independent of the Estate Agent. EA would make far more on the mortgage commission than the fee they get from the sale. I have used London and County but it was several years ago , not sure they are still going.
I suspect there will be a house price drop, but whether it is universal, and as much as 30%, I would not like to say. However as Bank Rate is really low, those who can get a mortgage will be in a good position to move quickly.
Get a decent survey, not just a Home buyer. A home buyer survey is really only for the benefit of the lender to make sure it is worth what they are loaning you.