Feeling bullied, should we pull out?

[DobbieFreeElf]

I’ve come here to get some opinions from people removed from the situation.

We had an offer accepted on a house in September, the house fits our, very specific, needs and although we would like to improve it over the years (new kitchen, bathrooms, maybe extension) we would be planning this to be a home for 20 years.

The house is an adjoining paddock, a couple of acres, which is ideal as I have always had horses (prior to kids) and when the little people are bigger I would like to get another.

We were all set to exchange on the Monday before Xmas when our solicitor calls to say that the sellers want to impose an Overage clause (also called uplift/ clawback) on the land. In essence this means that if planning permission is granted on the land we must pay a percentage of the increase in value to the sellers. We felt completely blindsided as we had never even heard of this before that date.

Aside from potentially building a couple of stables in the future we have absolutely no plans to develop the land. (Why would we, we love the house because it is rural).

I can’t decide if we should cut our losses and walk away now.

Now the seller is threatening to put the house back on the market next Monday. We feel backed into a corner and bullied.

Initially we were dead set against the overage (especially as it was dropped on us at the 11th hour) but having had time to look around at what else is on the market (nothing that meets our needs), thinking about the 15k extra we will have to pay on another property (as it’s doubtful there would be a house we would complete on before the SD holiday ends), the £2k+ we’ve already spent on conveyancing, searches, surveys, inspections etc. and many other factors we had decided that we would be open to the overage (as long as we negotiate terms that we are ok with)

Are we stupid, should we walk away, is this fate giving a massive warning sign...

I can’t help but feel that this is a massive red flag being waved in our faces and we really will be better to walk away...

I'd tend to agree, OP- saying they will put it on the market for more money is odd. I think there is a reasonable chance that if you concede and spend another couple of K drafting the overage you may find there is another price bump before exchange.

If they really want to sell then they will compromise at 15 years, I would not offer further concessions. If they don't compromise then they don't want to sell (either fleecing you was always the plan or they've decided they can get more).

I'd call their bluff and say that you will leave your current offer and 20 year overage on the table for 14 days and they are free to proceed straight away or remarket and see how they get on. However after 14 days you will only proceed with no overage and will start to view other options.

OOooft... walk away OP

I'd probably just not engage any more. Let them relist, why would someone pay 65k more - is it actually worth that much?

You need a rics surveyor to advise. No one on here can. It might be totally reasonable given the plot. Shit of them to bring it up late but they may have only just got proper advice (as opposed to an unqualified estate agent). Agree with pps - try and negotiate on the time period for the overage clause and also when it's payable.

They have behaved badly. In your position I would be genuinely concerned that if I agreed to their terms on this they would come up with something else.

I also agree with PP that whatever you intend, sometimes life throws a spanner in the works and although that doesn’t mean you shouldn’t go ahead, I’d be wary of thinking you’ll definitely be there for x number of years.

I would be inclined to call their bluff, quite honestly. If what the EA says is true - which I doubt - then they will have other interested parties deciding whether they want to buy a house that’s suddenly £65k more with a 40-year clause they didn’t know about, just as the stamp duty window closes.

@chocolatepowder this is the best advice... I was previously a rural surveyor and they specialise in this sort of thing. Estate agents will know nothing but the really, don’t have any qualifications. Surveyors have four years formal education in the matter and another minimum two years to qualify.

I can’t legally give advice but I’ve never ever come across a land sale which didn’t have an overage clause... it’s just good business 💁🏻‍♀️ Best of luck trying to find land that doesn’t have it

If you give in to this- and you class it as bullying- remember that when you give in to a bully there will always be further behaviour you don't like.

So walk away, or just say no to the demand.

If I possibly could I'd walk away. I hate these cheeky last minute people and wouldn't give in to their 'demands.

Hmm. If you really like the house and other properties nearby are more expensive I’d actually consider it after everything that has been said on here. Especially if you could sell the house separately if you needed to sell. I know it’s extremely frustrating, but you might be cutting your nose off to spite your face. Building stables/an extension isn’t going to be an issue for you, which is one of the things you were worrying about.

OP, to echo some of the other posters, overage in itself isn't that unusual though really bad that they've only woken up to thinking about it now. 40 years is really long though - and I've drafted and seen quite a few overage clauses over the years.

Fingers crossed that the cold light of day and the bird in the hand approach makes
the sellers see sense and agree your compromise.

I wouldn’t sign 40 years. It’s a mistake to decide now you won’t be selling it, things change. We bought our forever home a year ago and govt announced recently they are merging two local train stations into one- the idea our closest train station would be closed was simply outside the bounds of probability, but it’s happened. We will stay 10 years, see the effects of the station change and decide if it is still a forever home or time to move on.

Just no.

Tell them to fuck right off.

This will probably be the start of even more shit. I would say no before you fork out more money on legal fees!

Aside from the principal of the whole thing, it's a fairly complex area of law so to say that they'll put the house on for higher on Monday is bullshit. If they want this, a)it shouldn't have been at the last min and b) they should recognise it's going to take time to deal with.

Sounds like they haven't a clue. 40 years is unreasonable and would cap the value of the land.

@chocolatepowder

You need a rics surveyor to advise. No one on here can. It might be totally reasonable given the plot. Shit of them to bring it up late but they may have only just got proper advice (as opposed to an unqualified estate agent). Agree with pps - try and negotiate on the time period for the overage clause and also when it's payable.

Agree with this. But it's the last minute Monday deadline that shows they're not reasonable people. If they had truly "forgotten" they'd be mortified and give you the time to get expert advice etc etc. I hope you find a way forward that you're happy with. Remember though - you have a multitude of houses to choose from, they only have one to sell. So they don't hold all the cards here.

Guess one thing you could do is make an appt to view another house which is on with the same agent this weekend. It’s a bit of a gamble though....

Don't give in.

Consider asking them to name a price for a fixed-term lease on the paddock rather than a sale? If you ask for it to be 100 years then you can sell it on when you move on and retain some value, or you could just leave for the circa 20years you live there and it is an expenditure rather than an investment.

But I suspect they will refuse as they actively want to find a buyer who intends to develop the paddock and will pass on a slice of the profit to them.

I would pull out. I just couldn't own something that in reality you will technically be sharing. Id always feel like I'm using someone else's land. It would put me off completely!
Would they have rights to be able to access the land at all??

Walk away. There will be other houses. These people are greedy dicks.

OP, if you want to put stables on it, check that the local planning department doesn't need a full commercial application for them - mine does, it insists stables come under commercial leisure activity, even if they're just for personal use in a field next to a residential property.

But I'd tell them to get knotted and start looking elsewhere, to be honest.

@whatsupbuttercupx that's not what an overage is.

Honestly sellers who will mess you about this much, and will refuse to budge on timescales etc, are likely to be a pain in other ways. If you agree to this, they’ll come up with other stuff, or instruct their lawyer to have the most difficult/onerous provisions in the contract and refuse to negotiate.

We’ve bought a lot of properties, and now walk away at the first sign of sellers being difficult, it’s not worth the hassle to us!

They’re going to put the property on for £65k more, at the start of January (so more competition), missing the stamp duty holiday, in the middle of the pandemic and just after Brexit? Are they quite mad?

I’d back out now- this won’t be the last demand before exchange. Be wary of the Sunk Cost Fallacy.

I can't believe people can act like this. I'd walk away if possible. Good luck.