Last and final, tricky to value, risk of down valuation WWYD

[Bobblesock]

Viewed and loved a property at the weekend. We were the first to view but there were 7 more booked on straight after us. We have accepted an offer from buyer with one other in chain.

The house is really hard to value. It hasn't been on the market for 40 plus years. It sits in an area of small 2 bed houses so any local sold prices will be for those. This house is much bigger - it is near an old mill and the 2 beds were for the workers, this for the boss. Crucially it has a gate with direct access to the canal, which is lovely. This apart, the area is not considered especially desirable - not grotty or unsafe just a bit of an odd strip on edge of former industrial area that is due for regeneration.

Asking price is way over other houses in the area, but comparable to other parts of town.

Estate agent was anticipating it going to last and final. We know there has been a huge amount of interest. Asking price is below our budget, but we need to keep some back to make some improvements.

I know there is a lot of down valuing going on at the moment and I don't want to get carried away with a stupidly high offer. But we really love the house and would plan to live there for 20 plus years. Our mortgage would be 70% LTV.

What would you do???

Make a good fair offer. If its valued lower you renegotiate or up the difference yourself. Ie base your mortgage on the lower amount and use other funds or part of deposit to fund.

Offer what you can afford and think it’s worth, that’s what everyone else will do. Then it’s up to the buyers.

There is no magic formula here. To say it’s worth x. It’s subjective. Make a decision on what you think it’s worth and what you can realistically afford and be prepared to walk away if you don’t win.

If it hasn’t yet gone to last and final, offer the full asking price to begin with.

But also tell them how ‘proceedable’ you are:happy to work with vendors timescales, good ltv that should help with the lender being relaxed and not insisting on retentions etc. Any points that make you a strong buyer.

Then if it goes to last and final, increase by what you would be happy to pay. If it is the sort of house you envisaged and has everything you needed for your top budget, go to the top of your budget.