Renegotiating price after survey

[Housen]

Hello all, advice please! We have just had a pretty disastrous sounding survey on a property we were hoping to buy. I know surveyors are always negative but this seems more than average. Most things are given a red rating. concerns have been raised about rainwater pipes, gutters, drainage, structure of roof, ceilings , all windows need replacing(!), deflection of extension , (potentially) rotting floors and rising damp 🤦🏼‍♀️, to name some but not all of the issues identified. Also the valuation came back as 40k under what we offered! (NB the property had been on the market for a while and we were negotiated up on a blind bidding process - to be fair we probably over offered because we were over anxious).

For context, asking price was 700,000 (had already been reduced , not sure from what- but had been on the market for a long while), we know they had two previous offers of 650k and 660k. We ended up offering and having accepted 705k after a blind bid. surveyor has valued property at 665,000 and has highlighted all these major concerns.

What would you do in these circumstances? We would like to go back to the estate agent and show them all the concerns flagged in the survey, and re-offer the price as valued by surveyor. We want to be both decent and sensible here, but not really sure what the right course of action is.

Help!

Withdraw. Forget the 40k under-valuation; I'm gonna hazard a guess at 200k's worth of work and a huge amount of inconvenience on top of that.

In case it's passed you by, most building project costs have at least doubled in price the last few years. This house sounds like a massive money pit.

Let it be someone else's problem.

Walk from it - or ask them to fund a full structure survey by an RICS surveyor.

But it looks like it’s well into six figures worth of work.

house could easily be an absolute dog

I would withdraw as well. I had a similar sounding report and decided to move on to other properties, I have never looked back and wished I had bought the house.

Sounds like a wreck.

I would bail.

Its never as black and white as that - depends how much you want the property / can cover the difference. If you went to a blind bidding process, chances are that someone else will step in if you pull out (whether that be a developer or another buyer who doesn't need a mortgage / can do the work themselves).

The seller may be prepared to offer a discount but thinks its very unlikely they'll drop £40k. You can ask but I'd be prepared to walk away / expect them to go elsewhere if you insist.

Ughhh. Thanks all for your advice. It’s so gut wrenching as we loved the location and we are in desperate need of a house. But we definitely don’t want a money pit :(.

It may well still be there after Xmas… it might get to survey and everyone might walk.

it would need a lot in for a builder and he’s have to be confident he could re sell at a strong price and I’m not sure those buyers are there at the moment with interest rates as they are.

just Pull out

I wouldn’t even go ahead with it. You’d need so much money off.

Run away. You’d need to spend ages getting quotes. Youll need so much off to not put yourself in a crap financial position and then you’ve got to actually get the work done. It’s a bad time to need loads of work doing.

Yeah, I'd run away.

If you choose not to -

Gather as much info as you can on the likely costs of doing all the work required, add that up, add at least 10%, and then reduce your offer by that amount.

I'm in Scotland and old enough to have bought and sold before the current system of home reports and valuations provided by vendor in advance of offer. Previously, offers were made "subject to survey" and it would be very much expected that a poor survey and low valuation would see the offer reduced.

When you offered did you offer and know of any of the faults. ? Did the roof look bad. Did the windows look rotten or is all this new news to you. ? If you want the house location is the top thing. If you have the extra money buy it. Sounds like you loved it to get into a bidding war.

Be financially realistic.

Re-negotiation , if you still want the house once ‘done up’ needs to be based on the actual cost of doing all that work plus the mess, time and inconvenience you would experience. And factor in contingency, given that labour is short and prices rising.

The work needed sounds a lot more than £40k.

No we had no idea. The interior decor clearly needed updating, but we weren’t aware of any obvious structural issues. The house looked very liveable and we thought we could move in as is and revamp it over time to add value.

Well if a neighbouring house all done up sold recently for 900k plus then you could take the risk. But your survey sounds pretty bad

We had a RICS L3 survey done on our purchase and it was basically 118 pages of red and why we’re buying a money pit. However, the house we’re buying is old (30s) and having owned a 30s house before, we know this comes with the territory. It was recommended we pull up all floors to ascertain if they’re just slightly wonky because of age (likely) or damp (unlikely). The windows are original leaded glass and perfectly maintained, yet the survey flagged them up as partially rotten and needing replacing.

What I’m saying is, are all these recommendations or requirements to make it liveable? We know rationally that we won’t need to go anywhere near the work our survey suggests, but we know this from experience.

Thank you , this is helpful to know. The property we are buying in Victorian , so perhaps these issues are all to be expected? It’s hard for us to assess as we don’t understand the technicalities and have little experience in this area..

@Housen Can you call your surveyor and ask for a quick chat to discuss what they found?

We've all been inexperienced buyers sometime :) When I got a concerning survey I called and made a human connection and asked realistically what needed doing to make it liveable and safe? What would they expect that to cost (although in my experience surveyors rarely have a clue about this!) I also asked what they would do in our shoes?

Before I ended the call I explicitly asked, would they buy this house and if so at what price? In our case when pushed he said yes and that the price we were playing was fair.

Surveyors are required to cover worst-case scenarios - if they miss something that is later a problem it's possible (though rare!) for them to get sued, so they are always covering themselves... I find that on the phone when they are less concerned about legal repercussions you can get a clearer idea of what's really going on!

Lastly - if you have the resources and the location is great then it may still be worth pressing on! All old houses have something wrong but honestly the biggest house nightmares in my group of friends have been with shoddy 90s/00s "new builds" where corners were cut and disasters ensue... With a Victorian house you at least know it's sturdy enough to have stood 100+ years!

Wish you all the best whatever you decide.

I would also walk away. It’s likely to cost over 100k to remedy, more like 150k.

If the seller is unrealistic on the price, that’s his problem currently, not yours.

This

Hmmn. Our house is 1920s, we had the equivalent of the old Full Structural Survey, and, though both we and the surveyor were clear that it was a doer-upper, it wasn't as bad as the survey the OP is talking about- there is some stuff there that isn't just 'usual old house stuff'.
Usual old house stuff is
gutters, roof tiles, drains needing attention, some damp due to poorventialtion in the house /blocked ventilation under the house, or leaky drains or the like, (real rising damp is very rare and highly unlikely, BTW). Old ceilings are probably lath and plaster, which can fail dramatically but may well never do so, but surveyors have to warn you all the same, replacement of windows needed, well, you do have to expect that in an old house unless it's fairly recently been 'done up'.
Not so good is the possibility referred to of structural 'deflection', and adverse comments on the structure of roof (rather than just needing reslating or retiling, which would be on my 'usual' list).
Middling is stuff like rotting floors. It depends if the surveyor said there were any, or that there might be some. In any Victorian house there might be some, so they will always say so to cover themselves ( like the ceiling thing). We got the 'might' on our survey, but surveyor added she had jumped about on the floors near the walls and not found any deflections. Given the hostility of one of the vendors to our surveyor, I can just picture that. 😆After we moved in, we just found a few joists needed replacing in one room, where it wouldn't have been possible to know from above until three layers of wooden flooring had been taken up (we found it by crawling under the underfloor). Easy to remedy for a competent DIYer.
On all but my two 'not so goods' I'd say this was a doer-upper not a 'made house' and you'd need to set aside a fair bit of money for it. You culd do most of them over time, none of them sound urgent except any leaks. The 'not so good' things need further investigation- might be nothing, might be serious. But if you haven't got the spare money for the rest, it's a no go anyway.
Does it need rewiring?

I'd tell them you can't, in good faith, pay more than £500k given the outcomes of the survey, and let them make the call.

Omg you have no idea how helpful this is. Thank youuu.
Re the rotting floors- he did say “might”- it’s all covered in laminate. But he did say the floors were v bouncy-
does this imply rot? He also went on a lot about beetle infestation..
im going to go through the survey again and might ask you some more questions if you don’t mind!!!

Aw thank you so much for your kind / helpful comment. I’m going to call the surveyor and talk it through.

If you do love the house, I'd also have an independent damp/timber surveyor in.

I had a L3 on this bungalow in March 2021, bearing in mind surveyors cannot lift fitted carpets or move furniture. Six months after completion I found out the floors were wet and sodden with mould. The only room with floorboards had wet rot/dry rot and woodworm. My elderly dog was affected and I believe he had a fungus in his nose when he died last October. If the vendor had told me, I would have had the work done before I moved in.