Should we go to asking price?

[herewegonumberthree]

Any advice please! We have found a house we like which is up for £495k. We know one exactly the same sold next door for £480k within the past month so we are pretty sure it's overpriced.

We've put in three offers and been clear we don't want to go above £480 and at a push £485 but the vendor won't budge below £490.

Should we up our offer to £490 even though we are definitely paying more than it's worth, or cut our losses and walk away (knowing he won't be able to sell it for £490 so might come crawling back in a week or two)

Keen to stitch things up before stamp duty holiday ends so it's a now or never thing

How long can you realistically hold off? Don't forget they will be holding out too knowing the stamp duty holiday will be adding pressure on you.

I personally would walk away, unless it ticks absolutely every box on your wish list and you dont think.you will find another as good for the price.

You could always bluff. If you don't mind losing the house in the long run.

"Our offer of 485 will stand until Monday. We are looking elsewhere, and would rather buy this property, however 485 is the max we will pay"

@BernadetteRostankowskiWolowitz we could hold off for a bit but risk someone else coming along and buying it for what we didn't pay

@Bitchysideisouttoplay we would be hard pushed to find somewhere quite as good but I don't know if that's just us having thought so hard about it we've mentally moved in

How would you feel if they sell to someone else for 490? That they overpaid or that you lost it for 5k.

@BernadetteRostankowskiWolowitz we bluffed to begin with but when we said we'd walk away he said that was fine as he has other people lined up to view

@BernadetteRostankowskiWolowitz I would think someone else overpaid but would also be gutted someone else had the house and we didn't if that makes any sense. Per square metre it's reasonably well priced- if the one next door hadn't gone for cheaper I wouldn't be questioning it I don't think

It's worth what you're prepared to pay for it. You're quibbling over a small percentage of the overall price. If it's the house for you don't risk losing it for that.

When we bought this semi-detached rural property oddly next door was also for sale. Long story cut short, we bought this one because we preferred it although the layout, etc was mostly the same. Next door sold for more a month or so afterwards.
Can't see that £5k is much extra to pay for a house you really like.

Is the house next door the same as this one and in the same condition, ie does this one have a brand new kitchen or is it in a better state of repair to justify the higher price?

If not I think you would be foolish to over pay. In any case, if you need a mortgage, the bank may well down value it based on other local values.
The stampy duty holiday has only caused prices to rise and by a much higher amount so you are likely saving money upfront but losing much more money because of price increases. I expect the prices will fall back next year.

Only you can decide but ...

1. house next door could have sold for less due to a reason to do with owner's personal circumstances, rather than house value.
2. if the vendor holds firm and you then take a while to find an alternative house to buy, you could be down £15k (stamp duty) rather than £5k

I would use the argument that another buyer may offer more but likely to be valued lower by mortgage company due to neighbouring house only recently sold.

www.independent.co.uk/money/house-prices-mortgage-latest-stamp-duty-holiday-b1179046.html

I am only seeing predictions that reduction in stamp duty has pushed prices up temporarily and mortgage valuations are reflecting this (see attached link)

£5k in the grand scheme of things is nothing. I agree with PP. Sometimes people sell because they are desperate, its a probate sale, it doesnt have exactly the same layout as someithing similar. At this price its likely to be your house for a while.

With the stamp duty offer going next year I wouldnt hesitate to go for it. I am a great believer in going with your heart for £5k. What does your heart tell you to do?

Thanks all, this is helpful. @Bathroom12345 my heart says go for it as I can see us living there, we're still in our starter home but now have a family and this would be a great family home for the foreseeable. But I'm also mega pissed off that all negotiations have been blocked... I don't like being held by the balls so to speak! But can totally see why he is holding out as he knows we are keen but also is in a position where waiting longer for a higher buyer wouldn't affect him financially.

This house has got a newish kitchen which is his reason for why it's worth more but the one next door has better parking so I'm not sure I buy that a kitchen adds that much value over parking.

@NorthernNic

It's worth what you're prepared to pay for it. You're quibbling over a small percentage of the overall price. If it's the house for you don't risk losing it for that.

This. If you want the house and can afford what the vendor is after, then surely you'd pay it. If you're happy to lose the house for 5k, it isn't the house for you

@NorthernNic

It's worth what you're prepared to pay for it. You're quibbling over a small percentage of the overall price. If it's the house for you don't risk losing it for that.

What this poster said. We bought our house in Jan 2019 - a house two doors down was bough four weeks before we bought ours and they're very similar in terms of overall sq ft, size of garden, condition etc, though floorplan is quite different. I kept tracking it on Zoopla for ages because I wanted to know asap whether they paid more for theirs than we did for ours (they did, by 5k). This made me feel good about it but equally, it was a negotiation so we would have gone up another 5k had the sellers stood firm.

As the previous poster has said, forgetting what another house has sold for, this house is worth what you are prepared to pay for it. If there has indeed been a lot of interest, not many houses come up in the area, it's in the perfect location etc - then the seller is doing right to hold out for £490k. Having said that, real estate agents will say anything to get the deal done, they get paid commission and not till the house is sold so if you do leave it a week or so, quite possibly they may come back.

It all boils down to whether or not you want the house. The amount you are thinking about is roughly two months additional on the mortgage, about 1% of the total value of the house. It doesn't put you in a great negotiating position to have become emotionally attached to the house but in the grand scheme of things, 5k is not a lot - about £500 on your deposit for instance.

Are there other things you can do to make yourself more attractive as a buyer? Guarantee quick completion or delayed completion depending on how fast the seller wants to move etc? Good luck!

A new kitchen is ££ let alone the upheaval it entails. I work on the fringes of property and people are very keen to take advatage of the stamp duty holiday and get in before Xmas. Whatever Xmas is going to be like this year!

Thanks all. I think we will go up to the max tomorrow- I wouldn't be happy to lose the house at all. I guess worst case scenario we overpay now and then when we sell, presuming it isn't during a crash, we just won't make as big of a profit but that's worth it to get some happy years living there.
We are as attractive as possible as buyers- not in a chain ourselves so I don't think there is anything else we can do to change his stance. So no chance but to pay or lose it

Could I give you what I have picked up in my new role. Move quickly. Very quickly, everything that comes to you sign immediately. Dont trust the post. I put too few stamps on some key documents once and it took 2 weeks to arrive at the solicitors. I ended up making a 120 mile round trip but it was worth it.

Dont give anyone the chance to change their minds, say you are being slow or worse sell it to someone else.

Dont worry about whether you lose or win that £5k when you come to sell. You have a house I can see you really want.

Good luck!

How long are you planning to stay? Will you be replacing the kitchen?

I wouldn't pay extra for a kitchen I was not happy with - in fact I did walk away from a nice house which had a recently installed grey kitchen. I would have only replaced it anyway.

Otherwise as PPs have said £5k is nothing to be quibbling over.

Best of luck.

@Sadhoot the kitchen is actually ok. I guess everyone is right about not quibbling over £5k but the other one went for 15k under so I at least hoped to meet a bit more in the middle rather than him moving by £5k and us ending up moving by £20k from our original offer and only £5k below asking.

Ah well I'm sure we want it so will have to concede, just unfortunate he knows that too!

maybe next door undersold

As you're only quibbling over 5k I'd go to asking price if you really like the house. Any more and I'd walk away. We walked away from a few houses where the price became very high. At the time I was gutted and really wanted to stretch our budget, but DP talked me out of it. Now I am really glad as I'd feel really ripped off and be saddled with a massive mortgage.

You are being ridiculous to think that two houses next door to each other should go for exactly the same price. There can be many differences in the fixtures and fittings even if the layout is the same, plus it comes down to supply and demand when they are sold. If you're happy to lose the house, carry on and stick to your principles.

@mumsy27 @yearinyearout
We've looked at so many houses in the same area recently so we have a good feel for what houses are going for- the one next door was much more in line with all the others that have gone recently. The house is definitely overpriced so it is a question of whether we are happy to pay over in order to get a house we know will bring us happiness and the answer is probably yes.

@yearinyearout this one needs stripped of all wall paper and carpets for new ones, all the light fittings need to come out and the garden needs completely relandscaped. The other one was good to move into just had a slightly less modern kitchen. He is being a total chancer, if I could see any sensible reason for it being so much more I wouldn't be questioning it