Advice on whether I’ve made a terrible financial decision!

[EmeraldSunnset]

Hi, hoping for some perspective here.

15 years ago I bought a house for £200k. I know I slightly overpaid at the time as there was a lot of interest in it and I really wanted it and it absolutely suited me down to the ground so I was prepared to do that and I don’t regret that.

Over the years I would guess I’ve spent £40k on various improvements (all small things like new windows, a porch, floors, driveway etc etc).

15 years later I am ready to move on and found the perfect house. After 4 months on the market and several price reductions, I have accepted an offer for £275k, much lower than I was hoping for and with all that I’ve spent on it, I’ve only really made around £30k in 15 years. However I am ok with that as I believe I am getting the house I’m moving on to for less than it could be worth too. I thought it was just the current market and was feeling ok about it. I live in Dorset so very sought after area if that is relevant.

Here is what’s thrown me! My house is a semi and my neighbours have the mirror image house. If anything my house is slightly better now with a porch and new floors. Undoubtedly though they have a much better outside space, an amazing garden which is double the size and beautifully landscaped, a large outbuilding which could be a brilliant workshop/ home office or even converted to a granny annex or something, several sheds, a car port, stables and a very fancy pond with fancy fish in it. My outside space is a slightly messy garden with a falling down shed.

Well theirs has gone on the market and sold within a few weeks for £440k, so £165k more than mine. Is the extra outside space and buildings worth that much more?! Or should I have tried much harder to get a better price for mine? I’d be so grateful for perspective as I’m struggling here! Thank you very much

Tricky one OP. If next doors sale does go through at the price agreed (by no means a given if they haven't completed yet) and the price eventually goes on RightMove it could mean you could get more for yours if you wait, as people will compare what's sold locally and obviously next door is an immediate comparator.
But if you've put good effort into selling,you have one you really want to buy and you're getting that for a good price too, you could just cut your losses and sell. Whatever an estate agent says, a house is only worth what someone will actually pay.

Having something that could be converted into a granny annexe (or separate AirBnB unit) is very valuable.

Agreed. And the other outbuildings will have potential for granny annex or airbnb ie an income stream etc.
people are increasingly looking for both

Also i think a bird in the hand is worth two in the bush. You have an agreed salw.

If you want to move why block yourself from the life you want to be living?

It's the outbuilding. No need for planning permission if using the footprint, if in good condition no need to build again. We've just been quoted 120k for a small bare shell and we still have to try for PP and then spend on electricity, plumbing etc

Sorry pressed too soon. And stables, there are people that have this as their main search term. It is an essential to some horsey people, especially with the increasing costs of livery yards.

No harm to get yours valued by the same EA. They might be able to explain the difference in value to you. It sounds like next door is a completely different prospect for buyers with developmental potential. Their interior finishes could be more appealing also. For example, some might think your added porch could need to be removed as it detracts from the look of the original house.

Comparison is the thief of joy, OP.

You have enjoyed your house, you have lived happily in it, you have ‘made’ some money ( I’m not really sure what that means over such a long time scale) Now you have found a buyer who seems serious ( no mean feat in today’s market) and a house you want to live in, can afford and which it looks like you are going to be able to buy. Don’t let someone else’s good fortune ruin yours.

I hope everything goes smoothly, and you have a very happy time in your new house. 🕊

We would have paid that premium. Our house is a semi, another was for sale on the same street at the same time. We big over asking for a huge garden backing onto fields (no outbuildings)

The other was on at considerably less and still hasn't sold. So yes. The right garden and land can attract a considerable premium!

It would be helpful to see links for both houses to compare.
Risky strategy getting next doors agents out to value yours, they have nothing to lose and everything to gain plus they won't care if you don't resell at a higher price and miss out on your next purchase.

Did you get 2 or 3 EA valuations @EmeraldSunnset ?

If I assume you did I would also assume your property was valued for about the right price. If it was way too cheap you would have had a queue of people wanting to buy it. The house next door sounds considerably better in terms of usable outside space.

With that much garden and outbuildings it might be being bought by someone who intends to partition the plot and build a new house and sell that off and still retain a garden the size of yours. Subject to planning of course but that sort of thing would add a premium. My sister and BIL are paying 600k for a plot with a falling down length of barn buildings with planning permission. Not inhabitable but it’s for the development potential and they plan on building five new houses.

Absolutely yes

I would pay more for larger outdoor space and a functioning office. Whether I'd pay that much more would depend on the market in the area etc.

But, I think providing what you've done suits you, you can buy what you want and you aren't putting yourself in a dire financial situation by doing so with the lower price of yours, then don't worry. When it comes to your home, in all honesty the money made on it is a secondary consideration. Whether it works for you and makes you happy it's the primary.

Properties don’t have an intrinsic value, other than the cost of rebuilding, they’re worth what someone will pay. It sounds like you tested the market and got a fair price for your house. Your neighbour’s house has different things to offer and appealed to a different buyer.

We sold our house in a strong market and had keen interest but took an offer because we had a property lined up and our buyer was in the best position to complete quickly. A year later she had our house on the market for £50k more, having done nothing significant to it. It didn’t make any difference to us, we got the house we wanted.

Comparison is the thief of joy, OP
Absolutely this ^

Risky strategy getting next doors agents out to value yours, they have nothing to lose and everything to gain plus they won't care if you don't resell at a higher price and miss out on your next purchase.
And absolutely this. Of course the EA will revalue at a higher price. Why wouldn't they ?

Honestly, id just keep your sale especially as it took a while to find a buyer. Its a strange market at the moment with some things doing really well and some things not so much. It sounds like the neighbours land has far better prospects and its been a bit of luck their buyer might have bug bucks to spend and if they are specifically looking for stables etc then they might be willing to pay over the odds. Id also add that landscaping is extremely expensive. I used to live in a house with a flat patio and then a sloping garden. I dont no how big the garden was but id describe it as slightly bigger than average for a semi - certainly nothing like yours or your neighbours. We had quotes to level the garden and it was coming out at around £45k. So if your garden is a good size maybe it would be double or even triple the cost to get jt flat like the neighbours and they have the outbuildings on top.

Thank you everyone, I feel so much better! I was happy previously as I’m getting my onward house for £60k less than it came on the market at which offset the disappointment at mine selling for less than it was valued at (by £55k) so I think I am doing what works best for me and I need to ignore the situation with my neighbours house. Also, it hasn’t actually completed for that price as others have pointed out. You are all really knowledgeable and kind and some of the posts have made me a bit weepy as I really don’t have anyone in real life to help with this sort of thing (I do have some friends but not the sort who would have any clue about this kind of stuff!). Thank you so much

Just wanted to say OP I can really relate to not having anyone to talk about this sort of thing with, and having to make these decisions on one’s own is so daunting. I have been looking to move for a few years now and keep getting stuck. Well done for making a decision and finding a new place you like! It’s been v helpful to me too to read through the replies.

It’s so hard isn’t it. I was the same for a number of years but then this house came up that was exactly what I wanted so I sort of pushed myself into it. I was happy albeit very anxious until this happened with my neighbours!

I hope you manage to do what you want to. I would now recommend posting on here if you need advice, it’s been so helpful for me!

Well, when we sell, we'll be losing around £40k on our house. So I wouldn't be upset about not making profits. I wouldn't even be upset about losing something like £5k.

Houses are for living, not for making profits.

Well they are selling multiple buildings + land.

Rephrase it

'someone sold their house (same as mine), as well as their workshop/small bungalow and a large plot of land... but they got twice as much as I got for just my house alone, is this fair?'

Also a house bought 15 years ago isn't garanteed any profit... houses bought prior to 2000 make large profits now 25+ years on. Anything bought 15 years ago is subject to wildly jumping housing prices and bought well after prices jumped up.

Houses are terrible investment as anything other than security for your family. Most 'cosmetic' works add no real value at all and maintence is just a requirement so unless you increase floor space via a large extention, loft conversion etc... then most work (new kitchen, adding french doors, removing walls etc...) is just the same as wall paper in your taste its a design choice for you and you only not 'value adding'.

Good gardens and large outdoor space however adds on average 20% to the price of a home since lockdown.