Buying in London - 2023

[EleMar]

Good afternoon everyone. I was wondering if anyone has some recent experience on buying a house in London? We've found this house that is perfect, and clearly we are not the only one thinking so as there are already 3 offers plus ours all above asking price. The property went on the market last Friday. The EA said we are going to best and final with deadline 6pm tomorrow.

I know the usual rules - offer what is worth to us etc., but I was hoping to hear experiences from people who went / are going through a purchase in London the past few months. Thank you!

I think that most people are expecting prices to fall but it probably depends on the area (eg places that have just got the Elizabeth Line are unlikely to fall loads in my personal view).

I know lots of people who have bought or are currently attempting to buy in London and if there is a long chain it is very tricky because of people's financing and getting nervous about potential drops.

That said, if it is the perfect house and you want to live there a while you should just offer what you can/want to and then put your blinkers on, esp if you can get a good fixed rate. Even negative equity is only a problem if you want to sell or remortgage again soon.

thank you for your response! Yes we are not too worried about prices falling, as we are planning to stay there long term. We are also chain free (we can't sell our flat due to cladding), with an AIP and conveyancer in place so in theory we have good chances. We are thinking of submitting an offer which is 8% higher than asking price (£1m+ property), which is the sweet spot for us in terms of not feeling too upset if we don't get it. I guess I am trying to gauge whether the 10-20% over asking price offers are still as common as they were in 2021 / first part of 2022.

That I don't know. Hopefully someone will come along who does. Sounds like you're in a great position though given what I've been hearing about chains collapsing!

I think that is going to be very area/property dependent. The market in lots of areas of London has definitely slowed and in some areas, is downright slow. But clearly you're not in one of those areas based on the interest in this one property! I think in your situation, you can only do what you're doing - find the right amount that you think is right for the property and for yourselves, and then cross your fingers.

There is a lot of stuff that is mispriced at the moment (mostly over priced)
I found price per sq ft was better comparison tool that % over/under the asking price

Would you be willing to link to the property? Would me much easier to give a view then.
8% over asking in this climate I would say is at least unusual.

Market has slowed here. In North London several have sat on the market for weeks especially those over 1m.

Most houses are over £1M in North London more or less, bar the very small or “compromised” in some way, like an ex council or weirdly designed.
Not seeing a slow down under £2M around here. Over that and it’s slow for sure.

We didn't get it unfortunately. 6 offers, and we were the second highest / very close to the highest offer. They must have gone for 10% above asking.

Ask the agent to give you a call if the sale doesn’t go through.

Thank you, yes they did say we are second in line if the sale falls through.

Wow can I ask which area in London? We have just listed for just over 1.5 and have had interest but no offers as everyone looking needs to sell! I would love buyers in your position 😌. The ‘bones’ of our house are great, amazing street, south facing garden, period features but most renovation was done 8 years ago and I am not sure if buyers want pristine houses or want to put their stamp on something. Best of luck with it! If it’s meant to be, it will come back to you.

@Bearsloth Prime Central and North London aren't really slowing because there's still lots of pent up demand from international buyers who couldn't travel in 2020/21, and also because those markets tend to have many more cash buyers, so cost of borrowers isn't an issue. South West and West London, where you have many more domestic mortgaged buyers, even at the £1.5m+ price point, is massively slowing.

Thanks so much @witheringrowan . Where did you find the info/data? Any idea how it’s shaking down in Clapham, Dulwich, Greenwich, Brockley, Blackheath? I suspect the latter 3 are more domestic but Clapham is also international magnet and Dulwich a cross between the two?

What is Brockley doing in that list 😂

It’s next to Blackheath and Greenwich except with better transport links and enormous Victorian houses and tree lined streets and cafes. Not far off the pricing of those 2 areas as a result.

In some areas there is a huge freezing up of the market, so far fewer properties coming on the market. This keeps prices high, and competition can remain high for those properties that do come on.

Chains are collapsing all over the place, which puts you in a strong position.

It's not an easy time.

If you really want it, offer what you can afford. Don't worry about paying a few k extra. If you'll be in it a long time, it won't matter in the end. They aren't building many new houses in London (flats yes, houses not so much) so I can't see a dramatic loss in value.

In your position I would take my time and speak to all the local agents, let them know what you really want and how much you have to spend as top dollar, that you’re chain free and keen to buy your next home.
You need to be at the front of their minds when they value a property. First to contact with details. First to view.

Build a relationship and you’ll see a difference.

I wonder how Muswell Hill/East Finchley are doing in terms of flats. Looking to sell my 2 bed and trade up to a 3 bed flat.

I think it is rather risky and foolish to start offering 10% over asking price in this climate.

Unless the buyers are cash buyers and don't need to tie themselves with a large mortgage.

Prices in general in London have gone down so I definitely would not entertain getting into a bidding war.

If you are stuck with a flat with cladding you could also face unexpected remediation costs at some point.

Why not advertise your property as a house swap? See if anyone wants to downsize and you would be the only two in the chain? Some estate agents offer this service to make it a smooth transaction.