Vendor not budging on house price

[BananaMoon4]

Hello Mumsnetters,
We have sold our house and about to exchange. We found a property that we like, that ticks almost all of the boxes, but is located on a very busy and fast moving road. The house has been on the market for 6 months, having also been on the market last year for 6 months. Last year, they had 'a buyer' that offered their asking price, but ultimately this buyer did not proceed as apparently there was an issue with their mortgage. So essentially, they had no buyer!
There are 3 other houses on this road, all priced 100k less, who have also been on the market for 6 months plus. The reason we want the house over the others is because it has a bigger garden and a separate annex for my mum.

We offered 8% below asking on this house and it was rejected, with the owners citing 'we got the asking price for it last year' (which has made me mad as they clearly didn't get the asking price from a proceedable buyer or it would have been sold!)

As soon as we find something we are ready to exchange on our house. Our AIP and solicitor is ready to go. The vendor has said they will accept 2% off their asking price (for reference, the house is just under 1m)

I am getting super frustrated as we have accepted a 5% below offer on our own house due to the market being a buyers market at the moment.

I suppose I am just looking for some advice, for someone not emotionally connected to this, on how we should proceed. My thoughts were to place a 5% below offer and walk away if they don't budge. The reason being the house is overpriced (but suits our needs) and is on a road that we will likely struggle to sell again in the future as it's so busy (but it's going to be our forever home to raise our family, so I'm not too bothered about that)

I also want to feel like I have got a good deal (who doesn't?!)

Should we just keep looking?

I wonder if the annex needed planning permission which wasn’t sought at the time it was built and that’s why the previous buyers dropped out?

Offer five percent less then leave it on the table for them. Keep looking. They can always get back to you.
you have dropped 3 percent off your initial offer. That’s only three percent off there counter offer so your not miles off. Who knows that may say yes.

Thanks everyone,

There are lots of points on the 100k for the house and garden and I think I probably didn't make myself clear - what we offered is 100k more for this house than the other houses on the street (that are all sitting unsold) to account for the larger garden and annex. What the vendor wants is 160k more than what the other houses are listed for. Same sq foot and condition.

Having spoken to their agent again today, they are wanting to hold out for their price, which of course they are entitled to do so. For us, my worry is the risk of our mortgage company not lending as it's overpriced, or a falling market. We will sit on it for a few days and decide what to do...

Your worries are well founded.

i had a neighbour who was convinced he could sell his house for 350k sat there for a year he finally got 290

they might not be in a rush though in which case either start looking elsewhere or hold tight

On the other hand at current prices an annex will cost at least £150k to build, and probably £200k, and they’ll still need (a) to get planning, which in the current climate is by no means a certainty and (b) to have the larger garden in the first place. So from that perspective £160k for both things seems fair, if not cheap. And yes, it might well be or become a falling market, but that’s going to impact the smaller cheaper houses with little gardens too and then they’d still be overpaying, just for a less desirable house!

It's very annoying but you can't force the seller to accept a lower price.

Annex and a bigger garden seems like it would be worth more than the other houses, just not sure by how much more.

It's up to you, if I thought it was way overpriced and would find it difficult not to lose money on it when selling I wouldn't buy it. But then if you live in it for 20+ years, what does it matter in the grand scheme of things.

I was also thinking that sometimes the vendor can make the conveyancing process more difficult than it has to be and initial negotiations over the price are the first red flag. You have to be realistic and put forward the offer you have and if it’s rejected then keep searching for your perfect property. Good luck.

I think you're being a bit silly tbh. An annex plus bigger garden are probably worth the extra expense anyway.

But if its a long-term house for you that works better for you, then you pay it.

This is from someone who has just had to offer above asking price by a not insignificant sum to secure a property that ticked more boxes than the slightly cheaper but worse location homes. We plan to be there 20+years so it'll all work itself out over the course of time.

I reckon they will wait now til sept as Aug is a bad time to sell. If they get to end sept no offers then you might be able to negotiate more

Frustrating as it may be, it’s their house, they can accept what they want for it, regardless of whether it’s overpriced or not. Go and find a house you can afford.

Your worry that the mortgage company won’t lend you the money as it’s overpriiced doesn’t seem right to me, are you getting a 100% mortgage? Your mortgage company are only interested in getting their money back so if you are getting a 75% or less loan to value then you will get the mortgage. Have you looked around to see if their are any better houses out their for you before you walk away? We will be getting into the quieter house selling period very soon so if the house you want is very specific you may struggle to find another house and you may find the same problem of a house being sold for more than you think it’s worth. It will not be easy going into rented, that’s if you can find somewhere!

That still sounds cheap though, an annex and garden are MASSIVE added value. I would expect it to be about 30% added value and if the house is in the million pound region that would be more like £300k not £160k.

Higher priced houses take longer to sell, its not that they are 'badly priced' and should 'reduce', its that they have far small pools of buyers to fish from. A million pound house is far out of the realms of most buyers but a house can still be worth that much even if it takes years to sell.

Another one coming on to say that the current cost of building an annex is likely to be well above £150k. Then factor in the bigger garden.

I don’t think the £160k price difference is at all surprising given the annex exists and the garden is bigger.

Re mortgage lending. A mortgage company will usually only lend against the lowest of Valuation, Asking Price or Agreed Price.

Anything above Valuation will need to be met by your cash reserves.

While there is no problem with offering over (and I live in Scotland where most houses are 'offers over' and in many places do consistently go for over asking), you do start straying into overpaying.

And of course anyone can hold out for any price they think it is worth. But I think many people over value houses, the online free valuations from Zoopla etc are all very ill-informed, and frankly we have all got used to house price inflation for 20+ years now. This incessant rise in prices means folk spend a lot on doing up houses, expecting more. As prices in some areas drop or stagnate, this will surprise many.

At the end of the day if you cannot reach a deal you cannot reach a deal.

If you're planning to stay there for the next 20 years, is £60k difference really going to be that significant?

You're not likely to lose it over that time scale, and as others say, you are probably underestimating the cost of building your own annexe.

You'll very quickly spend a good chunk of £80k renting while you faff around looking for another house. An annex and more garden sounds worth it?

Exactly, a down market affects everyone, including OPs buyer.

And the cost to build and finish an annex would be £100k plus - add in the stress of doing a build, it sounds about right.

I always find it amazing when people insist a house is overpriced. I mean, no one is forcing you to buy it. If it’s overpriced, find another. The fact that you’re getting upset about it suggests it’s not overpriced to you.

I bought a house last year that had been sitting on the market for 18 months with no takers. We saw it and fell in love with it. To some people it’s not worth the price but to me, it was worth more! We felt so grateful to secure it. Had I not, I’d have kept looking like I did with the previous houses I’d viewed.

You can’t have it both ways.

If you want the house pay the price, ridiculous that you think you are that important they should take less because it’s you.

The vendors can see right through you and they are calling your bluff. They know how much you want the house and that you are unwilling to compromise on the annexe and garden. They can see you trying to negotiate rather than walking away and looking at other options. They are in a very nice position of just waiting to see if you will cave in and offer the asking price as they are clearly in no hurry. Ultimately, the house is worth what you are willing to pay for it. Call his bluff and walk away. He may relent.

What is the condition of the house.

If getting them to meet you halfway now is like getting blood out of a stone then what will happen if you try to negotiate down following a poor survey result ?

Is it worth risking the survey price ?

It is a buyers market, but they probably do that know it.

I would suggest telling them that properties are being left on the websites for months, and if anything they are going down, not up or remaining the same.

Show them the properties which are similar around the area and how much they sold for.

I did this early this year, house was perfect, but too expensive for what it was and it was on a busy road. I have now found something much better, and that house is still on sale!

I think you either keep looking, and wait for that house to go down, of course it will. Or just forget about it

You can give them your best offer and they can accept or hold out. Its their house they are obliged to give you a good deal

A house is only worth whatever someone is prepared to pay for it. We have been led by the nose into these situations by greedy estate agents for years. I do think these situations need to be treated without emotion.
Put in the offer and keep looking for the house you want. I live in a crazy area where the house prices are out of control and I wouldn’t be able to buy our home we bought 5 years ago but I did want it and paid the asking price. At first the agent wouldn’t accept it on the basis that all the “down from London” brigade were coming at the weekend to see it. I said call me when they don’t turn up ( just after covid) and he did. This is the second time I’ve had this situation. Make your offer and let it go.

We’ve only ever done this - and I don’t think I’d do it differently unless I really really had to. The stress of trying to exchange on a whole chain and all move at once would probably do me in!