Advice needed! Landlord is selling...

[HowToBuy]

I'd love some advice ladies...

Was given notice this week that my landlord is selling up. Have been here 5 years, in the area for 12, it's 10mins from work and my teenage DC school, 5 mins from my parents and we're pretty happy here. Notice is 6 months.

It was my agent that gave me notice so have yet to speak directly to owner. I apparently have first refusal and should make an offer.

The rental market is dire where I am (I'm in Ireland)... literally nothing suitable for under €500 more than what I'm paying now. There are also zero houses to buy.

I think I have to try and buy this house. My plan was to emigrate when my DS went to college, but he has 3 years left so I need stability for him for at least 4 years.

My budget isn't huge, I can maybe get €240k maximum which is probably the lower end of what the property would go for. I think if it went to the market, it would be €250k - €275k.

My work contract expires in August so I have asked to fast track this with a raise by the end of this month. (Sickeningly I just had an incredible job offer I now need to turn down because I won't get a mortgage on probation).

I have an appointment with mortgage broker tomorrow.

How can I position myself best to buy this property? What can I highlight to reduce the price?

If it's a straight sale then we don't need a real estate agent so he saves that fee. Presumably straightforward with solicitors as well so he'll save there? I'm also in situ so he won't have any loss of rent, whereas it might take a while if it goes to market.

There has been zero maintenance done on the property, except by me, since I moved in. It's across from a, now very loud, business that has expanded majorly in the last 2 years so that would likely affect the price.

Do I need to get a structural survey before I make an offer? Should I have it valued myself?

I'm honestly clueless, please help!

Awwwwww I meant every word!
Yep, I find this country a total nightmare financially tbh 😬
This sounds like it'll work out brilliantly for you 😁 look forward to the updates! X

So a little update... spoke to an amazing broker today (free and gets paid by lender @BooomShakeTheRoom 😊) She talked me through everything and was able to find a lender that would take my whole annual bonus into account (apparently some only give 50%) so I can qualify for a mortgage of €228k bringing my buying power to €253k!

I then rang a local property law solicitor and he has said that the fact it is a leasehold property should be taken majorly into account when making an offer.

Looking at the 2bed house that sold recently for €225k just by me, I calculated roughly they had spent a minimum of €30k on renovations and upgrades, bringing the cost without to about €195k.

For an additional bedroom in a house with no upgrades, I figured €25k was reasonable (?) so I rang my agent, told him I could immediately get €220k together, that I have wiggle room but it would take a while to get additional finance together which would slow things down.

He said to come back with my mortgage approval when it comes through and he'll make a case to the LL to sell me the property for that price based on ease of sale etc. He didn't seem anyway negative about the price at all, told me I'd be the best buyer for the LL even at that price.

Does anyone know... do I have to show my approval in principle when making an offer? Will the LL/agent see how much I have been approved for???

This gives me hope! Even a few thousand would make all the difference to me.

So glad you got a good deal and congrats on the flat purchase! X

Hi OP ,
That is sounding very good.

Don't show any paperwork that shows you can borrow more. See if you can just get your broker to confirm that they have looked at your finances and you can get the relevant mortgage. Or ask them to get an agreement in principle for the offer amount - ask your broker's advice they are the experts.

Don't move too fast with providing everything. Make sure they know you are keen but don't make it look too easy for you. I'm only talking a couple of days but talk about getting everything together/organising proof of deposit - getting the cash together. Just giving a general impression that getting this money together isn't a breeze.

If your landlord accepts your offer and the survey does not show anything of major concern I would be very wary of reducing your offer. Your landlord probably wants to help you and would love to sell to you, but push it too far and if they already feel they are accepting a low offer that might risk them pulling the plug. If it's a good/fair price then don't try to reduce it.

Good luck!

Sorry if I have missed the info but do you know how many years are left on the lease? If it is short you will need advice on how much it will cost to extend it. I don't think you can value the property without knowing the length of the lease.

I’m a landlord, I’ll be honest, I would not agree to a sale for under an evaluation price, most will be aiming for the top end. (You don’t make that much profit on rentals after mortgage, tax, insurance etc).

Are you sure you can’t get a mortgage on a probation contract? I did 5 years ago, also your landlord may be open to waiting 6 months for you to pass your probation if the offer is reasonable

The agent is working for the seller so dont be too open about your finances.
You can usually get the lender to do a letter with the offer price rather than the total approved amount ask your broker on that.

If you are in a leasehold you need to look at the accounts of the development

https://www.citizensinformation.ie/en/housing/owning-a-home/home-owners/management-companies-for-apartment-blocks/

https://cro.ie/

And check the planning file on the LA website to see if there was any planning conditions or enforcement notices against the development.

Good luck

I believe that when the property was built in '98/'99 it was subject to a lease of 999years, so plenty of time left on it 👍

Would you really not take into account things like not having to paint and prepare the property for sale, no downtime on rent while the property sells, no estate agent fees, buyer not in chain and funds ready for a quick sale? I'd imagine when taking that into account it could amount to at least €9k / €10k?

There hasn't been an official valuation done on the house yet but no house here has sold for more than the €225k that the last house with major renovations sold for last year. The closest any other house has gotten in the last 10years is €190k.

Probationary period is not the only issue, it's the drop in income due to lower base and little commission for the first few quarters.

@AnSolas @Winter2020 thanks so much on the advice about the AIP paperwork. I'll see if I can get documentation/confirmation for the €220k and if not, ask them to revise the AIP to that amount.

I'll try to keep my cards close to my chest while showing I'm keen and ensuring they know it's an initial offer. If I have the offer accepted at that price, I definitely won't muck around with negotiations after the survey, unless there's something serious highlighted.

My head is still addled with all of this info but I'm definitely feeling a little more positive today, thank you everyone x

£220 you’ll get it for don’t stress

I’d be tempted to get your own valuation done to get a figure, from what you’ve said there it might be in reach?

Oh @Parsley1234 I love your optimism so much! I really hope you're right 🤞

@Laralou999 if he comes back and asks for vastly more than that offer, I'll definitely look into trying to get my own valuation. A PP mentioned it may be difficult if I'm not the owner. However, the lender will want a basic valuation done anyway.

Ladies, I’m further along in the house buying saga and back for more advice please.

I’ve been approved for my mortgage (yay). Budget is €240k ish.

im going to make an offer of €220k to my owner for the house I’m currently in. Led to believe by my agent that the owner will accept that. However, it appears there is holiday home planning only on my property and my lender won’t lend me the mortgage under those conditions. So I will have to ask the owner if he will apply for change of use planning which will take minimum of 3 months approx. Also an issue of Japanese knotweed in the garden which I’ll have to get him to agree to have the management company deal with also. The house is 3 bed, 2 en-suite with WC also.

However, another property in my development has come up. I’ve been to see it. It’s a 2 bed with downstairs shower room and upstairs family bath, both small. It’s not in great condition. All of the external doors and windows need replacing (grants available), both of the bathrooms will need renovating and there is no kitchen to speak of so full kitchen required as well, painting, new carpet throughout. Living area is relatively similar sized to what I currently have. What would be my bedroom is ample size, my DC would be slightly smaller than what he has now. Back area is slightly bigger and communal garden/grounds to the back are nicer than mine currently. The house gets a lot more sun than mine, never sun in my kitchen. He was looking for €200, I made an offer of €185, he agreed to €190.

What would you be inclined to do under these circumstances? Is the additional bedroom, en-suite as well worth an extra €35k do you think?

@HowToBuy
I would absolutely think that an extra EUR35,000 (approx just under £30,000 GB Pounds at today’s exchange rate) for an additional bedroom and en-suite is worth it.

For what it’s worth, I know a lady who lives behind my son’s house. She has a two bedroomed detached house but is finding it very difficult to sell; most viewers also go and look at three bedroomed properties on the same estate and they’re the houses which are selling.

My son actually lives alone with his dog but works from home….he preferred to have a three bedroomed house as one of them has his bed, another one is his office and the third one he uses as a ‘games/media/guest’ room.

The extra bedroom can be an additional source of income for you if you wish to take a lodger for instance.

Good luck!

@Roaminginthegloamingthanks so much for your thoughts, and I’m inclined to agree with you, I think my own house is my preference at the moment, I just can’t help but think that the other is €30k cheaper and I’d have the opportunity to put a real stamp of my own on the property as it needs total redecoration and some reno. But do I actually want the hassle of that? Do I really want to deal with the grant applications and tradesmen? I’m just a bit torn.

But either way, it’s really positive that I have 2 properties to potentially choose from… this time a week ago I was losing sleep and feeling like the worst mother in the world that I was facing potential homelessness and upheaval for my lovely DS. So I’m taking this quandary as a positive 🥹

I will say, the 2 beds in this development get snapped up in no time, a few have been sold in the last couple of years and they’ve been taken off the market super fast, so selling on in a few years I don’t think will be a massive issue… unless we hit a major recession of course (cheers Trump 🙄)

It depends if a reno is something you really want to have to do - it absolutely consumes your time. Not just the doing but the shopping for tiles, fabrics, flooring, then doing and renovating every weekend. You could easily sink 30k into it, will that add the same value or more on? It doesn't seem like a huge difference for a massive lot of hassle? If it excites you then definitely an option!

The Japanese knotweed in your current property would be a massive red flag for me, I'd go as far to say it devalues the price further. Nobody will buy the property with that there, and lenders will not lend with it on site usually. Does that potentially give you some wiggle room to reduce your current offer?

Have you shopped around lenders to see if any others will lend to you despite the planning on it?

Gut feel for me says 35k difference for the second property does not seem like enough to justify a big difference in state of the property, as well as one less bedroom.

Thanks so much @Thegreyestatethe renovations excite me a little, it’s nice to think that I’d have the extra money to spend making the place a home with me and DCs stamp on it. My fear is things not going to plan, or taking longer than expected… I’m a planner and maybe a bit of a control freak so could see this really causing me stress if throngs go awry.

ive told the owner of my current property that my offer is subject to him sorting the planning permission and having the HOA deal with the Japanese knotweed (leasehold property). He is due to come back to me before the end of the week to let me know if he accepts my offer and the conditions with it… still a chance he’ll say he’s just going to sell as is and then I’ll be down to 1 option with the 2 bed.

If both options are on the table, I’d be inclined to stick where I am and just take more time to do the work that I’d like to do. However, I’ve had a good chat with my DS and surprisingly, he’s more excited about the 2 bed, even though his room is smaller. Excited to make the new room his own and help with the reno process. I know I can’t make a decision about house purchase based on his preference but it’s good to know he’d be excited about it.

I suppose I just don’t know if the extra bedroom and en-suite is worth the extra €30k, but it likely is in the long run I suppose.

Just another little update (mostly because it’s nice to read back myself on what’s happened, it’s like a journal that gives you advice!)

My current owner accepted the €220k and has agreed to apply for change of use planning!

So I’ve informed my lender, engaged a solicitor, need to book a mortgage valuation and survey tomorrow and then choose insurances. The yellow engine light has come on in my car, work is insane and I’ve just had to pay €2k for DS orthodontics! I’m stressed 😅

But I’m happy and feel a bit more at ease now, I just really hope everything goes okay with the planning application. I’ve kind of put all my eggs in this basket now so I’m hoping for the best!

Thanks again for the previous advice ladies and I’m sure I’ll be back with more pleas for help and advice in the weeks to come! 😅

Ah, and another thing to add as I read my last post before this evening, brought DS for another viewing of the 2 bed and while I chatted to the lovely owner he went off to measure what would be his new room. When we got back it was very evident that it was much smaller so he changed his preference on which house he’d prefer and I’ve promised his room will be the first we’ll do once we buy. We’ve been talking fitted wardrobes, desks, day beds… it’s been fun! And I’m glad he’s changed his mind as I was afraid he’d be disappointed staying where we are after seeing somewhere new he could work with. But the bigger house is definitely a better option and in the long run would be with the extra €30k so thank you @Thegreyestate@Roaminginthegloaming

Thank you for the update, @HowToBuy !
That's good news, and it sounds like you have a good plan!

I also hope everything will be fine with your son's orthodontics, and your car.

Thank you for the well wishes! Ortho work looks like it will be fine. I absolutely tempted fate by mentioning to my family last weekend that I’d passed a KM milestone in the car (it’s has a lot of miles!) and how she was going great! And by Tuesday the engine light had come on 😅 Booked in for a service tomorrow, crossing my fingers it’s not a big issue, I absolutely can’t afford it right now! 🤞