Buying our landlord's house

[BigPawsBrown]

We currently rent from my boyfriend's sister and her husband and they have said they would like to sell up in the next sixth months and have given us a kind of first refusal.

They are going to get it valued and we are going to have a meeting about getting a mortgage and save like mad for the next six months It's come at a good time for us - we have both just had salary jumps, mine significant (trainee to qualified solicitor) and wanted to start saving properly.

What would you be considering here? The relationship between my DP and his sister is a close one, so we don't want to quibble. However I'm not sure either that this property would fetch the asking price immediately. I was tempted to do our own valuation - or get them to put it on the market to see what it's really worth, but there would be a risk there'd be an offer higher than what we could afford that the landlords would take.

I think they are prepared to knock a bit off for the value for the saving they will make on not using estate agent's fees, but generally want to sell it at market value.

We are doing the same thing. We live in a house owned by my dad. He's said he wants/needs 100k for it. He has plans for an extension on another house he lives in and it would fund that so the price is non negotiable. I think looking around the market, the price is about 5k over the market value but we do have a huge garden, around a third of an acre. It's actually big enough to build another house on and still leave us with a big garden so we aren't going to quibble over the price and hope the mortgage valuation goes through without a hitch.
He said we could pretend we were selling it and get an estate agent out for a valuation but what's the point? It wouldn't change the price and we've spent thousands making the garden nice, fitted wardrobes, double drive and other improvements so we aren't just going to leave it. Plus we love the house and where it is.

you offer what you are willing to pay and that's it.

same as any other house. You just add a rider that 'if you don't want to accept our offer, no offence meant and none taken'

Hm - the problem is I don't know what it's worth. I don't want to offer the asking price and be stuck with it later if it won't sell, or be in negative equity etc. And I'm not sure an estate agent who thinks they will put it on the market with them will provide a true valuation initially either. So I don't really know how best to find out the value, that's the problem.

same way as the agent will. Look at sold prices for nearby similar houses (not asking prices, sold prices). Compare with yours. Stick wet finger in the air and guess somewhere near!

You can search rightmove and other property websites to see what similar properties in your area are being advertised at, and also the actual purchase price (although I think these have a 3 month delay from the date of completion) this will help you gauge what your house is worth

Get three valuations from estate agents and pick the middle valuation as a starting point for negotiations.

Bowlers advice is what I was going to suggest.

Have looked on rightmove but in our area it's basically the only new house (12 years old on a road of houses 100 years old - all houses around here are Victorian except our row of five - the only one sold in last ten years is our neighbour's which is an end terrace with an extra bedroom). Really hard to call the price!

Just get some estate agents round to value it! They don't know it isn't yours to sell. It's obvious, isn't it?

So if they give a fairly high figure representing where they would put it in the market as a start point knowing a) they would bring it down if it didn't get offers at that price and b) it may not even sell for the eventual asking price, but I am not going to go through that process as I am not buying on the open market, so I worry they would say it's worth X, i'd pay X unknowingly thinking that was market value, come to sell and realise I have vastly overpaid? That's the worry.

We did this, my uncle owned our house and we bought it off him after a few years, was a great move for us, but was tricky negotiating the price, especially as we knew what he payed for it and it had gone up a lot in the few years we rented, but we payed pretty much market value less estate agents fees. We did get it valued by afefew fonts on his behalf (although Ithink there was one very high one we lost somewhere
Good luck

I agree, three valuations and go with middle.
My experience, the estate will say put the property on for X amount, but expect to get around this amount.

Start looking for other houses at the same time. At the very least do lots of right move and zoopla research and find sold prices in the area. It's not just the street you're on but the area generally.

You will start to get an idea of what you can get for your money. Might also be a good idea to look at other areas you'd consider moving to.

I think any price an EA gives you is still a starting point for negotiation. If your ILs do go with putting it on the market it doesn't preclude you still putting in an offer later and might help family relationships by being an all round market tested offer.

If they want the convenience and cheapness of a private sale they will still have to meet you halfway on price.

See what else you can get for your money. If you're a qualified solicitor it's worth 'jumping up' a few rungs on the housing ladder as your salary should rise comfortably and it will be cheaper for you longer term if you stretch yourself now. Your current house might not be to your requirements in a few years and you'll be glad you opted for something bigger / nicer than the one you've been living in to date.

But you aren't in a different situation to anyone else looking at a house to buy. No one knows if a house is worth what they are paying for it, or that the market won't go down in the future instead of up.

I would get three agents round, and do as much research as I can.

If you can see a figure your brother is happy with, you think is in the right area, then you could look at a few houses in the area to see how it compares. You might even find a different house you would prefer to buy.

Or you might decide you'd rather rent and rent a different property.

Do you know any surveyors? They would have a much better idea of the value of a property than an estate agent would.

Why would a surveyor know better than an estate agent rallytog?

If you invite estate agents round to value with them thinking you are the vendor you can ask what they realistically think the property will achieve, which is different to the figure they would market at. At the end of the day, something is only worth what someone is willing to pay and you have to use the data available to work out what you are willing to pay (on any property, not just this one)

If you need a high percentage mortgage then you need a surveyors market valuation rather than estate agents one. Otherwise you'll just have problems come your mortgage valuation survey.

If you get a basic valuation report, not bank linked, you're probably looking at about £200 (based on the last one I had done 2 years ago).

But mortgage surveyors price their valuations on what other properties have sold for. Through estate agents. Surveyors don't go round valuing properties for the open market; they get confirmation from the market that the bank/building society's client is paying the right sort of price.

The first port of call really is through estate agents for market valuation.

OP, if you have 3 valuations and they say 170,000 170,00 and 170,000 for example, you know the property is worth 170,000.

If they say 150,000 170,000 and 200,000 for example, thats trickier, and when you would need to look into it much more thoroughly.