What do you do when buying a property

[Wearyheavyladen]

A property I’m interested is being marketed at £15k less than the almost identical house next door except the house next door has 4 bedrooms including a properly done up extension above the garage. The house next door is also slightly bigger. They are both in the same condition, needing lots of work.

I like the house for the potential it offers. The location is great but I am wondering whether the asking price is crazy. Don’t most people research what houses sold for in the area before making an offer? The house next door was only sold in January.

I’m wondering whether to wait it out to see how long it stays on the market because I highly doubt someone would be naive about the price a 4 bed literally next door was sold at.

So next door completely in January for 15k but it was extended? You can always offer less for the house you’re interested in. However, there’s a bit of a mini bo going on at the minute so many areas will be more expensive than a few months ago.

Ultimately you have to make a judgement call on how much this house is worth to you - can you afford it? Is it better then anything else in the same price bracket? Think about it and then offer what you think it's worth.

To be clearer, the 4 bedroom with an extension above the garage sold for £675k in February this year and the 3 bedroom one is now being marketed at £650k. A fully refurbished 4 bed house opposite of the same style sold at £700k this month. No work needs to be done.

Would you not look at this info or would you just base it on how much you desire the house?

The work needed on the 3 bed £650k and the 4 bed £675k to make liveable long term is loads. Easily near £100k if not more.

I’d definitely look at the comparators and offer what I thought it was worth. They may of course say no.

People research similar properties for sure, but prices can differ significantly sometimes. It all comes down to what the buyer is prepared to pay, and the seller prepared to accept.

It is more expensive than the other ones. You could always put in a much lower offer if you love the location and want to stay long term but be prepared to have it rejected.
You can also keep an eye out for done up houses if they work out cheaper. My area is a bit like that: you never add much equity by doing up a fixer upper so it’s easier to get sth that doesn’t need much work.

We don’t want to put an offer in until it’s been in for a while but there may be someone who is prepared to lose a lot of money for a while. It’s also about £30k-50k more than the estate agent valued it at. I found out by chance but I doubt others will find this out.

It’s all such a game this house buying business and I fear we don’t have the skills or energy for it.

If the vendor is unrealistic, they’re more likely to keep it on for a year than take a lower offer after a week or a month.

Have you seen many other properties? Is this the only one you like?

JoJo, actually yes and that really stresses us out. We’ve been looking for months. I’m sure there must be something out there but nothing else have come up. At the same time, our head and financial sense tells us that paying that price is ridiculous because it genuinely isn’t worth that amount. I guess we are envious that someone would be willing to pay it and we would lose out. Relying on other potential buyers to go with their head and for us to play the waiting game may not pan out.

Your 'needs £100k of work' could be someone else's 'just a new kitchen and bathroom', or 'we want a house in this street at any cost'.

We've just paid over asking for a house that is perfectly liveable but to be our dream/forever home will need a loft conversion, side return and a fair amount of period restoration. The market is hot here post-lockdown and I think we were lucky to get it for what we paid, but a year ago it would have sold for 15% less.

The houses here that are truly priced unrealistically don't sell, or take a very, very long time to sell. Only you can decide if the vendors have their heads in the clouds or are likely to achieve that price, or near to it.

I’ve just had something similar OP. House has been on market for 14 weeks, they haven’t had any offers - I’ve placed an offer £ 25 K below asking as (for me) it needs a new kitchen, flooring, bathroom and plasterwork. Vendor reduced slightly but we were unable to meet in the middle. My advice would be do not set your heart on just one property unless you are able to meet the vendors asking price (or close too). This can mean paying over the odds.

We paid asking for a property that really we should have got for about 20k less. But we’d have lost it because it’s a good solid house on a great street.

We are quite happily living in it but will shortly be spending about 100k on it. The owners were quite happily living in it and others would quite happily live in it without that work.

There’s a lot of heart over head in house purchasing.

I think buyers are fuelling sellers greed and the problem gets worse as each successive seller tries to increase the equity upon sale. It’s a farce but what’s the solution when you need to move for good reasons?

because it genuinely isn’t worth that amount.

It may not be worth that amount to you. The value may be different for others.

It is in fact worth exactly what any buyer is prepared to pay for it. If that is a price at which the sellers are prepared to sell...

A few extra thousand to secure a forever home could mean very little spread over decades of living there. The calculation would be very different for someone looking to turn a quick profit on a doer upper.

At the end of the day, if the house ticks all of your boxes, you have the money to buy it and it doesn't seem to be wildly overvalued for the current market, £15k here or there on a property of that value makes very little difference.