Buyer dropped their offer

[Areyootakingthepish]

We secured a buyer on our property back in May, and it took us ages to find anything due to the market being dead. Our buyer has been patient and held on and we had an offer accepted in our onward purchase last week. That’s chain free. So a short chain.

Since May the EA has been checking in with the buyer if they are still on, and told them last week it was looking like we were going to get an offer accepted and if they were still on. They said yes, they knew there wasn’t another house of that quality for that price in the area. At the time we accepted 4% under asking which we thought was a good offer in this market.

We managed to agree to 5% under on our onward purchase but the seller was very reluctant, and initially rejected but we were the only proceedable offer.

Tell our buyer hurray we are on, they go quiet for two days and now say they want 20k off. Which is about 3% off again.

We really can’t afford to absorb the hit, as we’ve maxed ourself to get our new house, which is a dream house. We have told the seller on our onward purchase but they’re not prepared to budge.

What happens now? I really can’t blame the buyer given the market and given how long they’ve waited, but if our seller won’t move then the deal can’t be done?

Well if you can't afford the decrease then you can't afford it ?

You've informed your seller of the situation so they had the choice as to whether to take the hit, and they said no ?

So I don't see what more you can do other than refuse to budge and hope someone at either end folds.

Where is your buyer in the buying process ? If they have not yet had the survey done they might be looking for further reductions if that does not turn out as expected. Where would that leave you ?

Your the only proceedable buyer your vendor has. I think you can do no more than tell them you love the house, you really want it, but that you now have 20k less as your max. Leave them to consider it.
Fingers crossed you will get a call.

Almost 7 months later I've no doubt the market has changed, only you know if it's lowered enough that it's reasonable of your buyers.

Did your buyers give a reason for wanting to reduce their offer?

I can’t really blame your buyer because it’s still a fair offer ( in most areas anyway) at 7% off the asking price. They will be well aware it’s a buyers market and will probably have listened to all sorts of people telling them they overpaid. However, it’s frustrating for you.

I don’t think you want to lose them as buyers. I would just explain the situation that you can’t proceed on the other house with 20k less in your budget so it’s back to square one. Also communicate the situation honestly to your potential sellers.

There’s nothing more you can do. I hope you have a good EA because this is where a good EA could really earn their commission by talking to everyone in the chain and getting everyone to compromise a bit in the hope that a deal between the 3 of you in the chain can somehow still be done. It may take some time.

I don’t think our buyers are being unreasonable as the market has changed and if we relisted, we probably wouldn’t get what their new offer is. I’m just annoyed as they should have revised their offer when we checked that they were definitely still on last week, so we could have made our offer based on that to our seller. Gosh why is it all so stressful!

Our buyer hasn’t done anything yet, but our house is only a few years old, so no survey issues I wouldn’t think.

Your buyer as waited so long, they really must want your house.

Go back to your EA and let them try to sort it out by negotiating a smaller discount along the chain, that way everyone takes a small hit and can move on.

or go back to your vendor and explain without a further 20k off you can’t proceed, due to your purchaser. And of course if they can purchase at 20K less then it’s no loss. At the end of the day it’s not so much about the buying and selling price it’s the difference you have to pay that counts.

Really your EA should be doing all this, it’s all about handling the emotions of the people in the chain.

The pressure needs to go upwards, towards the people with more expensive homes and probably more equity. The people you are buying from are going to have to negotiate money off their onwards purchase.

This is where you need to step back and let the respective EAs argue this out and earn their commission.

From a lot of the EA programmes I watch (though you will never read it in the news headlines) most places were losing about 2% per month off their value during the time your buyers were waiting. So, as annoying as it is, I think they are still being reasonably decent. I would absolutely be renegotiating in a falling market if I had still not got anywhere after six months.

Alternatively, you need to buy a cheaper house :(

As above. With our EA all parties were asked to ‘split the hit’ (😆). It might just work to get the sale through. Can you afford to share the drop?

If it doesn't work at least you know you've tried.

Yes we’ve left it in the hands of the estate agents.

At the end of the day our buyer can only have our house if we move, and if our vendor won’t accept then we need to find somewhere else and he needs to wait longer. The other option is we all take a hit and move on as someone else suggested.

Honestly I feel like giving up! If this move ever happens I’m not moving again 😂

Offer was agreed in May, and there's no survey?

I was going to agree with you that the Buyer hasn't been unreasonable in revising their offer after being so patient for six months. But if they haven't had a survey done in that time were they ever serious?

To be practical, if you were listing the property today what would the asking price be and what would you accept?

I think they've been sensible. Why would you pay out for a survey if the people from whom you're buying haven't even found an onward purchase at that point?

You've clearly never modified or withdrawn an offer following the results of a survey.

If you waited six months before doing the survey, and then it turned up something that made you decide to reduce your offer or walk away you'd feel a bit stupid at having wasted six months.

I wouldn't wait 6+ months for them to find an onward purchase, so it's a moot point, but in this scenario I'd rather wait to do a survey than fork out money only to risk the house being taken off the market because they can't find an onward purchase.

We did say to our buyers not to fork out any money on searches etc until we had found an onward purchase. As we wanted to be fair to them. Only now that we have found somewhere are they using it as leverage to lower their offer. Which worries me as to whether they will play with a straight bat going forward.

if we had to relist today, we would have to relist at their offer and would likely achieve less. So in principle I can accept their offer, but it means I can’t buy my onward purchase, which means they can’t buy my house yet. So we have left it with them that if they’ve waited this long, are they prepared to lose out now?

They don't seem to have been playing with anything other than a straight bat up until now. Instead they've been remarkably patient and trusting of you. In the meantime the market has dropped, and by your own admission the market value of your property is now inline with their revised offer.

I can understand your concerns but equally I can see it from their point of view. If I was in their shoes I wouldn't want to be negotiating the new price every 3 months say, I would wait until the deal was ready to proceed and only then re-evaluate how much I felt the market had fallen.

All the time they have been waiting for you, they have seen other properties come to market and often get reduced before selling. They have had 6 months to reflect on the fact they may have overpaid and there has been loads of stuff in the media about house prices "crashing". Maybe that was an exaggeration but nevertheless they will have heard those opinions being aired.

Obviously they do really like your house as nothing has come up in all that time that they prefer. Nevertheless, they don't want to feel they may have overpaid to the tune of thousands of pounds. It's always the danger if sellers don't get the deal done quickly that the buyer will withdraw from the sale at some point or lower their offer. I'm not blaming you in any way for the delay but you would have been very lucky if they had patiently waited 6 months for your house in a falling market and not tried to re-negotiate on price.

Try to take the emotion out of it and work with the EA who will hopefully be trying to find a compromise solution that everyone can accept.

You could always sell your house anyway and rent for a bit. Then you are in a better position for buying in future.

"The pressure needs to go upwards"

Exactly.

@Areyootakingthepish what happened in the end?

We completed two weeks ago and we are in our lovely new house! All of this feels like a bit of a distant (bad) memory, and so if you need to move (like we did) do whatever you can to make it happen would be my advice.

Sounds stressful but congratulations on completing 😀

@Areyootakingthepish

What did you do in the end?

@Areyootakingthepish that's amazing news, nice to know things do work out. We have a buyer waiting hope once we find somewhere there are no dramas. Enjoy your new home 😄

Thanks for updating. Always interesting to see how things pan out in a falling market.
Did everyone take a little reduction to get things moving?