Right house, wrong vendor

[Bambi75]

Argh, after a long time looking we've just found a lovely house in a nice part of west london. Problem is, it's off market and being done up by a property developer with a bit of an ego. It is a 4 bedroom period property that he is doing up with an architect to a very high spec. We have been trying to do a deal with him and have made him a very good offer to keep it off the market (it will likely go to bids if it goes on the market). The offer we made was already over what the going rate is for similar houses in the road but he's come back and asked for a minimum of £1,000 per sq ft, Arguing that it is a unique product and there is nothing else like it on the market. what he's asking for is a whopping 30% more than its value had it not been done up to a high spec. Sad truth is, he will probably get the money he wants for it if it goes to market.

Do we try to negotiate further for this house we love, or do we accept that it is way overpriced and walk away?

he will probably get the money he wants for it if it goes to market

so why would he sell it to you for less?

Good point Pigletjohn - because we are chain free cash buyers who can exchange in 10 days and he'd like some quick cash to inject into his next property. But yes, I see where you're coming from. The ball is in his court really, so if we can't meet his demands and he's confident he'll sell it quickly at top whack when there's nothing much else on the matket, then we should probably just walk away if we don't want to massively overpay for it (even though we could probably stretch to afford it).

Make your best and final offer, with the conditions, set a time limit for the offer to be accepted,

But from his point of view, he won't lose to wait at the moment,

Would you like any different finishes if you were to take on the project at this point?

Overpriced, walk away. He knows where to find you if he needs you.

Its so hard to guess London prices at the moment because they are rising so rapidly, the thing is he will probably get a few offers as soon as he puts in on. Your in a good position but I think he probably wouldnt take any less then hes asking. We had 5 offers within 24 hours on ours last month, took us completely by suprise.

Yes quoteunquote we would like some minor tweaks (paint colour) etc, but he wouldn't allow us to, that would be one of his terms. He would give us contact number for his architect but because this is his first project I think he wants to get the house finished and photographed in all it's finery to use for portfolio/show off to all his mates

I'd walk away, but not before giving my final offer. If he can't sell then he will come back to you for your offer.
You don't know it may be priced just outside what people are prepared to pay.
I know house prices are increasing but there will be some who will sell as they no longer find themselves in negative equity, these houses will be this mans competition.
If I was you I'd start looking elsewhere.

Thanks everyone. This has really helped me make a decision. I'm going to walk away. It is a lovely house but he is asking for £350k more for it than the house next door which was sold not so long ago after being developed to an almost as high spec, and that kind of makes me feel slightly sick to the stomach, especially as I'd be paying for someone else's very expensive taste!

um, well a few things spring to mind,

I do this day in day out,

He will need finished project shots for his portfolio, not to show his friends but future clients, and website.

personally I would be very wary of anyone first project,

as for changes, we don't agree to any, unless the money has changed hands, at this stage in the project I would already have all fixture and fitting on site/in workshop, so adjustments would be extra,

Has he been in construction prior to running this project?

Some unscrupulous contractors once an exchange is made on unfinished project rush finishes, finishes are excessively time-consuming, and as they are what you permanently look at, are extremely irritating to live with if not done perfectly.

Thanks for the tips quoteunquote, this guy hasn't been in construction and the architect & designers he's using are top notch and well known so I think it's all above board. It's his project so he can of course ask for whatever he wants for it, but we are definitely walking away. I think if it had been a bit bigger - we will outgrow it in a few years when our girls are teenagers and the garden is only 18 ft long - then we may well have gone for it because it would be our forever home and overpaying for it wouldnt have been so bad in the long term. But it's a lot of money for a house that we'll have to move again from in a few years.

Ps I'm quite envious that you get to property develop day in day out - I'd love to do that.

As PigletJohn says, why would he sell it to you when he could get more ?. To be honest I have sold to a cash purchaser and those who have needed to get a mortgage and the timescales have never been significantly different. If I was going to get another 200k for a couple of weeks wait I would.

Yes you're right Havetowearheels. As it happens there's another property we've seen just this afternoon - a lot bigger and in a better street and we're going to make an offer on it! Just goes to show - one door closes, another (bigger one) opens :-). Thanks all!

Glad to hear it, I hate greed. But unfortunately in this market it does happen as there are always people with too much money.