Would you buy a house you know is overvalued? [Content warning: contains mention of suicide]

[propertymug]

If it was the perfect location?

House has been on the market at current price for a year. Prior to that it was priced approx 10% higher so this is the reduced price. It is in an affluent area but clearly overvalued - nearby houses have been selling for approximately £540/sq ft. This is on for £720/sq ft. It needs full renovation, so much so, we're thinking it may be more cost efficient to knock it down and rebuild and get exactly what we want/save VAT on costs etc. So it isn't priced at a premium because it's in immaculate condition or anything like that.

Vendor is adamant they won't sell for much less than the asking price. They did have an offer for approx 7% below current asking from a developer but they then pulled out.

The property works for us because it's on the street we want and walking distance to the village/train station etc. We currently live fairly rurally and the independence our teenagers would gain would be amazing. The views are stunning. Overlooking a lake on a golf course so will always be there (even if golf course gets sold to developers they can't build houses on a lake).

There's not many houses that come up for sale on that road, particularly undeveloped ones, so chances are if anything comes up it will be even more expensive and still unlikely to be to my taste.

Cons - plot is smaller than we would like but that seems to be the case for all the houses closest to the village.

• Garden is NNW. This originally put me off but having done some research and viewing the house at different times - the garden is still big enough that it gets a lot of sun. I'm also thinking I would like to make the most of the view with a lot of glass at the back so maybe that's actually a pro.

• Turns out the vendors spouse committed suicide in the garage. Not sure how I feel about this - i guess if we're knocking the house down then it isn't really an issue.

So, what would you do?? We keep going back and forth - we're in a great position (chain free cash buyers) and so I was thinking we should be able to get ourselves a good deal - instead we may end up overpaying, in a falling market! Any thoughts/opinions would be much appreciated

[Title edited by MNHQ to include content warning]

You reckon it's overpriced by 30%. No idea what that is in ££ terms but it would be utterly ridiculous to have overpay that much for a house you're planning on spending a fortune renovating.

If the bank downvalue it, can you afford the shortfall?

It sounds very like what we’re going to put up for sale (no golf course or suicide!) We’ve lived here 18 years and loved it. We’ve not finished the work as my husband and parents have been very sick over the last few years. We’re only moving next door, I’d be hard pressed to give up this location.

The golf course wouldn’t put me off. As you say it pretty much guards your view, especially with a lake. The suicide wouldn’t bother me, much as it is sad. And it wasn’t in the actual house.

If you’re cash buyers then you’ll never really lose on profit. Especially if you’re going to do it up. Ours would be worth £150k more finished and probably cost £60-80 to finish. If you can afford to do the work, really love the house and plan to be there for a long time I’d go for it. But I’d try to get a bit off if it’s been on the market a while.

Yes, I definitely would if location and plot were perfect AND I was planning to stay for the long term because the purchase price is pretty irrelevant then.

And re: garden, ours is probably NWW rather than NNW and it is fabulous. Ours is a reasonable size (maybe 90ft) and fairly wide and we have sun in some part of it all day long. It really is perfect IMO.

Yes I forgot to say, our garden is north/north-east facing but long enough that it gets sun at the end of the garden in summer afternoon/evening and morning sun near the house.

I just don't think I could ever bring myself to overpay by that much. It's a lot! (going by your per sq m prices).

DH won't view houses that have a N facing garden unless the garden is huge. He lived in one growing up and said the patio was a slippery mossy mess.

I wouldn’t be faffed about the golf course, unless you are at the end of a driving range!

Are you intending to buy this as a ‘project’ and continue to live in your current house? Because if you are going to knock it down or do major structural work, you would be ill advised to live in it, especially with teenagers . I would also be cautious about demolition and starting from scratch, there are a lot of onerous (and probably short lived) regulations and requirements which you can avoid if you leave a certain proportion of the house standing.

The financial aspect is up to you; some people would gnash their teeth every day if they felt that they had ‘overpaid’, some people ( amongst whom I probably would be included) would just be glad they had the money to live in a place they loved.

Some houses are built on land that have had all sorts of horrors take place on it throughout the years (ignorance is bliss). I think I read of one being build on an old burial ground (the owners were unaware). Even houses without deaths could have had loads of negative situations occur in them. I think being aware of a tragic event like this, and it being so recent would be hard to ignore for alot of people though. There may have been so many happy memories made in that house, before this horrendous event, but for me, every time I walked into that garage I would feel sadness. I wouldn't want to feel this way in my home.
I didn't think I was a spiritual person at all until buying a house. Some just seem to have a negative energy/feel about them. The house we bought just had such a nice happy feel about it; they say you know instantly when you walk through the front door, and should go with that gut feeling. Maybe get a surveyor out first though!

If its the forever house then I might. If it was a rung on the ladder then no, you can't afford to overpay, but the forever house is different.

Exactly. It depends on so much. People overpay for things all the time.

The fact the guy committed suicide wouldn't bother me. Most old houses will have had people die in them.

Growing up our back garden backed on to a golf course. We didn't get loads of balls in our garden, those we did get got collected by my DB. He then sold them back to the golfers 😂

If you are not looking to make a profit, but just want to live there (forever) then it really doesn't matter what you pay as long as you can afford it. If it's really what you want go for it, but you do seem to have a few quibbles other that it being overpriced.

It's not overpaying if you're willing to pay it because it's ticking boxes that other properties aren't. All properties go up in value eventually, if you're there for the longterm it will even out.

Btw I would also be loathe to pay the asking just because the vendor's being stubborn but at the end of the day if it's the One, get it! It's only money 😆

You are somewhat limiting yourself if there is only one road you want to live on. Surely there are other nice places too? Given the amount of work that needs doing, are you sure you can afford that on top of the purchase price? It sounds like the vendor might be difficult throughout the purchase process.

All that said, it's your money, so you should do what makes you happy.

Location, location, location.

Honestly, if you can afford it and you can see yourself living there for a long time, I would investigate the knock down/build new option.

That way, you can build now for your needs in future years. Ground floor bedroom suite, doorways big enough for wheelchairs, flat entry and exit etc.

If you have the funds & can see your family living there & then using it as a base for all of life's stages, then go for it.
I'm sure you can come to terms with the sad death of the vendor's spouse, perhaps with a little memorial of your own to enable you to move on, emotionally.
Make it your home, and be happy there.

But don't offer the current asking price - at least match the developer's!

Apologies @EggbertHeartsTina, I wasn't aware of the correct terminology so thank you for letting me know - I will try and get the Op edited to reflect this and put in a TW in the title - I'm so sorry this upset you this morning.

Based on the local average sales price/sq ft I'd say the house is worth about 20% less than it's currently listed for. The agent reckons we can get it for £X which means we'd be overpaying by about 16%.

Not sure if house is structurally sound but we are thinking of knocking it down anyway so really we're paying for the plot and not the bricks and mortar. The house is empty - owner is elderly and in a care home. Negotiations are with her and her children/grandchildren who obviously have an eye on their inheritance. Clearly, they're not desperate to sell!

What does it matter if you overpay in a falling market if you are going to live there for the foreseeable future and you have the means. It's going to be your home.

Annoyingly there really is only one road we would consider. We made a mistake with our last house and bought because we fell in love with the house (still love it) but it was in the wrong location and logistically life has been very difficult. This will be a move back to the village we previously lived in but walking distance to all the amenities. The other roads within walking distance are smaller semi-detached houses, this is the only road with large detached houses, on slightly larger plots. Similar, larger houses are slightly further out hence this being the road for us.

No I wouldn't overpay in this climate & the suicide would put me off.

But if money isn't an issue then do it.

My first step would be to consult the local planning authority to see what their policy on demolishing/rebuild would be. There’d be a tremendous Ho-Ha round here if anyone wanted to knock down even the blandest of properties.
Or maybe see what a local planning firm advise?

But price wise, if you're planning to stay there forever and can afford it then it’s a bit of a non issue. But first, find out if there’s a good chance you will get permission to rebuild.