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Original poster

Going over asking price by 150k…stressed!!!

94 replies

MovingandStressed · 06/07/2023 00:22

Hi all, I need someone to calm me down! We offered in March on a property that we loved, asking price 700k and because there was so much interest (think could barely get a viewing etc) we offered 150k over in a sealed bid process to secure it. We were told after we won the bid by the agent that someone actually went slightly higher but they wanted to sell to a family.
Now the market has gone down considerably since then, we had got a really good offer on our house (also paying over asking) but they have now pulled out and we are looking to have to reduce our asking price by 50k. Fortunately we can borrow enough to allow us to buy the property we like before selling ours (paying an absolutely extortionate mortgage in the process).
Now massively panicking that the price we are paying for the house we love is way too high in todays market (it’s a very lovely location - bit of a one off - which is why all the interest). We would intend it as a forever home. Needs oodles of work extensions etc and totally gutting (we are used to doing big projects but this time I wouldn’t have the intention of moving!!), but the plot is fab and I love it. In terms of buying the property, if we had sold this, we would only have a tiny mortgage, but we need a bigger one for all the extension work, but still half what we are currently paying, so the interest rates don’t worry me tooo much. I want a good investment though and I’m getting really nervous about the fact that we are overpaying asking price hugely for this and that they probably wouldn’t get that in todays market.

help!!! Do we renegotiate the price?

OP posts:
LadyVictoriaSponge · 06/07/2023 00:29

Personally I think you are being foolish, honestly a one off unique house that you love in a perfect location in a great plot and you would risk losing it for 50k? it’s a drop in the ocean for a forever home, give your head a wobble.

Stripeysocks0 · 06/07/2023 00:46

I personally wouldn’t choose my forever home based on investment opportunity.

User19844666884 · 06/07/2023 00:49

It’s an investment or your forever home. Not both.

Decide which it is and then you have your answer.

C4tastrophe · 06/07/2023 06:53

LadyVictoriaSponge · 06/07/2023 00:29

Personally I think you are being foolish, honestly a one off unique house that you love in a perfect location in a great plot and you would risk losing it for 50k? it’s a drop in the ocean for a forever home, give your head a wobble.

It’s £150k over.
Asking 700, offered 150 over, purchase price £850k.

Because of market change, they have to reduce their asking by 50k.

Diymesss · 06/07/2023 06:56

I think you could come back with a reduced offer based on the work needed done and the changed market now. The worst that can happen is they say no!

Changingplace · 06/07/2023 06:56

I think you’re insane, there’s a huge risk you’ll end up in negative equity, don’t do this.

BillyNoM8s · 06/07/2023 06:58

No advice, but I can't believe you offered so much in the first place, that's insane!

Would you not have been better just looking at 850k houses from the get go?

Ihavekids · 06/07/2023 07:00

I think what you're suggesting is cheeky. You made the offer and haven't found any issues to justify the price drop, it's just cold feet on your part.
If I was the seller I'd definitely worry about more requests to drop price from you, and I'd put it back on the market or return to some of the previous offers. As you said, there's been lots of interest.

Roselilly36 · 06/07/2023 07:01

Market has taken changed, I would act cautiously. Properties are taking longer to attract a proceedable buyer. What if you can’t sell?

ownworstnme · 06/07/2023 07:04

Are you even still proceeds Le now your own buyer has pulled out?

MushMonster · 06/07/2023 07:04

I would not buy the property in these circumstances.
I would stay put in the property I have, at least there is an actual need for me to move.

ownworstnme · 06/07/2023 07:04

*proceedable

BanditsOnTheHorizon · 06/07/2023 07:06

If it's your forever home and you can afford it then go for it. If you're buying it as investment then it's a bad one.

The only time I'd be cautious is if you're deposit is a small one, as you may end up with negative equity, which isn't an issue if you can continue to pay the mortgage, but you might come unstuck if you get made redundant etc.

We paid slightly over the asking price for ours during Covid, but we had no intention of moving again (unless it's health related), so all I'm interested in is insuring I can meet my monthly payments easily as I'll never have to worry about how much it may sell for in the future. We have a small mortgage so if the shit did hit the fan and we lost jobs and couldn't meet the mortgage, we'd still have enough equity to buy a small house outright

Weal · 06/07/2023 07:08

How upset would you be if they pulled out of the sale when you ask for a reduction? If there was that much interest and they had multiple offers over asking my they may choose to just put it on the market again. Also I’m assuming maybe the price drops wouldn’t apply so much to a house that is very popular and unique…probably likely to hold its prices better if it’s extra special.

Goldfoot · 06/07/2023 07:09

I've never seen a home as an investment.

If the mortgage is small relative to the value then begative equity us less of a risk, though still possible if the market really crashes like the 90s, butbthat only matters if you need to move.

You need to choose, either you're buying a house you love to live in forever or you want an investment. If you're lucky it could turn out to be both, but which is most important to you?.

If it's about investment I wouldn't be buying anything in the current market.

silverlentils · 06/07/2023 07:09

If the financial landscape has changed since you put the offer on, and this makes it too much of a risk for you, then it is perfectly reasonable to have cold feet and pull out. Tell the seller you are very sorry but your sale fell through and now you can only go to X amount. They can make their own choice based on whether they think they can still get £150k over if they marketed again. Yes they will be annoyed but you have to make the right decisions for your own situation.

£50,000 is a lot of money, that's an extra £350 a month on a mortgage!

user6482959 · 06/07/2023 07:12

BillyNoM8s · 06/07/2023 06:58

No advice, but I can't believe you offered so much in the first place, that's insane!

Would you not have been better just looking at 850k houses from the get go?

Agree

BingBongDingDong · 06/07/2023 07:12

You say it's going to be your forever home, but then later say you want it to be a good investment.

These two statements are contradictory. If it's truly your forever home, then it doesn't matter if you go into negative equity because you never intend to sell it. But if it's an investment, then what you pay for it and how much you spend on renovations matters a great deal.

If it's the former, and presumably you've done the sums and you can afford it, then I wouldn't risk losing it and I'd carry on.

If it's the latter, there's no way I'd proceed.

You need to decide whether it's a forever home or an investment, because the answers to your predicament are different depending on which it is.

GoldDuster · 06/07/2023 07:13

If it went back on the market today would it be likely to sell for 150k over the asking price? It's worth explaining your situation and renegotiating if possible, if they say no then you'll know how desperate you are to buy the house.
Nobody knows what the housing market is going to do, so an investment it is not.

tenbob · 06/07/2023 07:16

Has the market actually dropped for that sort of house, or are you just assuming it has because you’ve lost your buyer?

One-off/trophy houses/houses that tick all boxes often don’t really fall that much, because as you saw, they have a number of buyers willing to pay above and beyond to get the house. And ultimately, you thought the agent valuation was ‘wrong’ last time because you were happy to pay nearly 25% more than they thought.

So if you speak to an agent who says the house would now be marketed at £650k, where does that leave you? Offering £650k or offering 25% above it?!

A house is worth what someone is willing to pay, and it sounds like there are several people willing to pay well above what the agent values it as, so it’s up to you to decide what it worth or how sad you would be to lose the house.

Another way to look at it is if it’s your forever home, and you think you’re paying £50k too much… what does that work out as per year of being there? £2.5k a year? Is that a fair ‘forever home tax’? Personally for me, I would b pay it

Goldfoot · 06/07/2023 07:17

The sealed bid process is different though. Asking price is a starting price in that system, so offering £150k over isn't as extreme as it sounds.

Mildura · 06/07/2023 07:19

Changingplace · 06/07/2023 06:56

I think you’re insane, there’s a huge risk you’ll end up in negative equity, don’t do this.

Given the OP says they will have a tiny mortgage when they sell their existing property, negative equity seems highly unlikely.

Greenfishy · 06/07/2023 07:19

I do think £150k over asking price is nuts and I’d never do that tbh, but I agree with other posters - if it’s a forever home and you are totally in love with it and you can afford it and are comfortable with it as it is then just stay as you are as you may risk losing it. The market isn’t being affected evenly by all the chaos - sensibly priced houses round here are going SSTC in days (South East commuter belt).

Mildura · 06/07/2023 07:22

User19844666884 · 06/07/2023 00:49

It’s an investment or your forever home. Not both.

Decide which it is and then you have your answer.

Exactly, if it really is a forever home what the property is worth over the coming years is largely irrelevant if you’re not selling it.

CockyTeeHunz4Eva · 06/07/2023 07:23

LadyVictoriaSponge · 06/07/2023 00:29

Personally I think you are being foolish, honestly a one off unique house that you love in a perfect location in a great plot and you would risk losing it for 50k? it’s a drop in the ocean for a forever home, give your head a wobble.

Agree with this.

Also another PP rightly pointed out that a forever home isn’t the same as an investment. If you’ll be there 20 years and do a load of work you’ll come out on top.

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