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]

From your updates, it sounds as if this is literally the only road that you want to buy in and as if money isn't an issue for you at all, unlike most people, particularly someone relying on a mortgage. As I already said above, you could definitely try the flyer idea. Failing that, decide if it is worth potentially losing large amount of £££ in order to live in that exact road long term. It may be that you have so much to spare that the top priority is getting exactly what you want. What is making you doubt your decision here?

The suicide wouldn't stop me buying a house I really wanted. It's concerning this house seems overpriced based on square footage price though.

If the vendor accepted 7% below asking price from a developer then I don't see why they wouldn't accept the same from you - or possibly 10% under?

If you’re going to knock the house down and rebuild then you’re going to end up having spent way more than the value of the house anyway so it’s kind of a moot question anyway, surely?

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.

I don't really understand this, in conjunction with what you're saying about cost per square foot. If this house is overpriced, why would any others be even more expensive? Especially given the views/protection from development that the golf course gives you, is it even overpriced in fact? Square footage isn't the only thing that dictates value.

Personally, I would go for it if it's the dream location and you can afford it. The death wouldn't bother me unduly though I might say a little prayer or something. My only concern on that front would be the possibility that it's overpriced (if it is) because there's some ambivalance about going through with a sale because of the history. Like, they can only bring themselves to part with the place if someone offers them megabucks. The fact that they changed their mind about the sale to the developer adds to that concern imo.

I don't think it will be overpriced because of a desire to maximise inheritance btw, because if the owner is in residential care, won't her assets go towards that until they deplete to like £25K or something, leaving nothing much to inherit if she lives long enough? But it may be more complicated than that, since you'd expect some anxiety to sell quickly in that situation.

For me, the suicide is irrelevant as it was in the garage. I’m not sure how I’d feel if it was in the house.

But I can’t get over someone wanting to pay above the market value and THEN rebuilding the house. I mean, you clearly have money to burn so part of me thinks ‘why not’. But the other side of me thinks of all the valuable things that money could go on so I think you’re crazy.

I personally would never knowingly overpay, but then money has a value to me as we have limited supply. If I were a multi millionaire, I suppose I wouldn’t blink twice if I felt the house was worth it in ways that others didn’t.

I’m also assuming you’re buying the house solely in your name.

If you have a spouse who’s joining you on the deeds, then hell no. There are a multitude of reasons why you may divorce in the future (no one thinks it’ll happen until it does) and trying to sell a house you’ve over spent on would be difficult. Unless you’d be happy to walk away with less than you came with between you.

Honestly if you can afford it I'd go for it. Our house isn't on the market yet however I'm on right move everyday and there has been nothing in our village (or the neighbouring one) that I've liked for months. If one came up I honestly think I'd overpay.

North facing garden would be a no for us. Hated the one house we had with this. Just not enough light in the house especially in the winter months. It may also be a deal breaker so less people through the door if trying to sell. Wouldn't ever overpay either regardless if I could afford it.

the north facing garden would put me off in your circumstances more than the overpayment. (As cash buyers etc.)