Sold price is much lower than asking price

[rabbitcarrot]

I just checked rightmove the sold house price, two houses are sold with the price lower than asking price in my saved file.

I remembered one back to late Feb this year, I want to book a viewing, the agent said it's fully booked already & they had several over asking price offer on the table. Then the house actually sold on 07/04/21 for £535,000 the advert in rightmove on Feb is £570000 over..

Another one is on the rightmove early September asking is over £550,000 , then early March sold price is £529000. They both adverted over asking price.

I felt very strange is it some landlord company collaborate with agent, deliberately not let other people viewing, at the same time said to vendor this is the cash buyer, the price is the highest you can expect.
Once they bought the property, they will let agent to handle all the renting issue?

If this is only one case, it's probably vendor accept cash buyer with low offer. However when I booked a viewing back then, both agents were very confident to reject me because it's a bid war, best & final offer involved.

Both properties are no chain, & need some refurbishment.

If they were in need of refurb, they could have come back with bad surveys and the buyers negotiated a reduction to reflect that.

I’ve had this, abs it’s usually been the estate agent in cahoots

I’ve sent offers direct to vendors to get around this when I suspect it’s happening by the words ‘there’s a lot of interest abs offers already on the table’

@ Onfire

How could you get vendor's contact? Agent won't give you any information about vendor, not even mention contact details.

House is in no chain situation, owner already passed away or moved to care house. I don't think their relative visited the empty house so often.

@ readytosell

The house is not in so bad condition, kitchen & toilet still very good, just need paint the wall & do flooring etc. It's definitely not a big project.

One of the risks of offers over in a bubble market is that the valuation comes in much lower. If the buyer requires a mortgage then the seller typically has to reduce the price to the mortgage valuation, look for a cash buyer or for someone with ready cash to top up the mortgage.

Simple version

House for sale at overs over £100k
Buyer offers £110k. £11k deposit and £99k mortgage
Valuation comes back at £100k. Mortgage company will only lend £90k with an £10k deposit

Buyer has to find another £10k deposit. Most cant and so they either reach a compromise say £105k with the buyer finding £5k or the sale falls through or they drop the price to £100k. Or look for a cash buyer for £110k

I once met someone who boasted openly of his ‘arrangements’ with local EAs. He would get the properties cheaply, do them up cheaply, and sell on.

Also, I once put in an offer, only a very little below asking, for a flat. Offer was turned down for what seemed a very weird reason.

I checked the sold price 3 months later - it had sold for way below my offer. I’m talking £180kish instead of £220k.

As the blurb had stated, it was owned by someone at the EA (it was a rental) - they were evidently only going through the motions of having it on the open market. I dare say it had been earmarked for a mate or relative of the owner, and the low price would mean a lot less capital gains tax for the owner to pay.

I’m not saying all EAs are dodgy, I know there are very good ones, but I’m afraid some of them are most definitely bent.

It is not unusual to accept a lower price.

Some higher offers may be in a chain, the finances are stretched, the timeframes do not suit the seller, the background info is less clear, additional work is needed, the survey highlights issues, the sellers situation has changed. The EA should be pass on info about the buyers to help the seller may a decision.

Definitely common around here in the commuter belt. A few times we've been offered viewings on properties (as investment purchases) after others we know have been refused viewings.

Investment buyers get given viewings first, everyone else told that no viewings are available but they'll call you in a week if the house is still available. Usually the house goes before anyone else gets to even view it, let alone make an offer.

The estate agent gets slightly less commission from the first sale, but there is a verbal agreement that they'll get future business with you. Either as commission from the resale after it's done up, or (most commonly) acting as the leading agent when you rent it out.

The whole thing has left a sour taste and ultimately seeing our friends and family
struggle to get on the housing ladder because of things like this put us off of investing in property.

@rabbitcarrot

@ Onfire

How could you get vendor's contact? Agent won't give you any information about vendor, not even mention contact details.

House is in no chain situation, owner already passed away or moved to care house. I don't think their relative visited the empty house so often.

@ readytosell

The house is not in so bad condition, kitchen & toilet still very good, just need paint the wall & do flooring etc. It's definitely not a big project.

Yes, so you think, but readytosell's point stands, unless you have seen the survey(s) you can't know what's going on. Might be that the wiring is so bad nobody would lend without a rewire, and/or work has been done without planning permission or building regs, could be all sorts.

Vendors contacts are really only possible if they still live at the house. I’ve sent letters to the actual house

Not too sure what you could do if the house is empty

Unfortunately i have relatives who are estate agents who boat about unscrupulous practises like these