Selling extended house for less than purchase price: how will buyers react?

[Spotteddaisy]

Grateful for any advice please re house selling.
We are not strangers to house selling as have moved 5 times in the last 15 years, (but in the same area) We have always made a small profit on the house sales to put towards the new property.

In Autumn 2023 we moved to Dorset, 10 mins from the coast.
Detached 4 bedroom house with a plot of just under an acre. In a lovely village, good schools etc nearby. Previously lived in Hampshire.

We have extended the house by rejigging the layout and adding a big dining/family room downstairs. We've made other improvements too like insulation, adding solar panels etc.
Had a couple of estate agents out last year to value it who said to market at £850k. But we have been on the market since last June with no offers at all. We have now reduced the price by £100k and changed agents at the end of last year.

We have had a few more viewings with this agent but still no offers. Which obviously means it's the price. So we asked our agent what we can do as we're aware that properties still on the market after 9 months don't look good.

He said we should drop the price to £695k. We are not sure what to think about this (my DH is fuming)as we bought the house for more than that 2.5 years ago and have spent a substantial amount on the extension and improvements. Surely anyone who has done their homework and looked up house prices etc will see that we bought it for more then added an extension so to then list it for less just makes it look really dodgy? I don't think the market has decreased so much in less than 3 years that we would have to list our (bigger, improved) house for less than we bought it for?! I know that ultimately no one will care what we've spend on it but the fact that it's now bigger than it was must count for something?

We really aren't enjoying it here and now need to move to somewhere cheaper and to be back nearer to family. This has all been a massive costly mistake and I feel so guilty. The fact that we could end up in negative equity is just stressing me out even more. We've never made a loss on a house and ploughed all of our savings into this one. We were so full of hope when we moved here, but it's all just been awful.

As a potential buyer what would people think about a house being listed at less than it sold for not even 3 years ago, even after its been extended?

If the kids are settled i’d wait it out a couple more years. I’ve lived 250 miles from family and close friends for 25yrs and wanted to return for around 5-6yrs now, but have waited it out whilst my youngest finishes 6th form. If you’re not desperate to move, just preference, i’d hold out for a year or two.

The house has only been on at 750k since January this year.

695k is the best offer they have received so far. But that doesn’t mean they couldn’t get closer to 750k if they leave it on for longer at this new, more realistic price.

They are getting viewings & someone wants a 2nd viewing. As there’s no urgent need to sell, worth waiting at least a few more weeks to see if they get a better offer than that.

I think it would be a mistake to sell I couldn’t lose that much money. Are things that bad you can’t wait a couple of years?

I love the big garden - a lot of people won’t
I would immediately want a second bathroom

The housing market is doing strange things at the moment - Labour are creating a lot of uncertainty and even the Iran conflict has caused withdrawals of sales according to our agent

Is all the grassed area yours??
get some men with fence posts to plant a dozen or half a dozen fruit trees over it and call a huge area an orchard ie never needs mown again. You put the fendce round irach tree to keep off rabbits and or deer. You could ask a local farmer if you could keep a couple of sheep on the land if it was fenced to keep the grass down. And plant several well placed trees behind the house in garden so house is screened from neighbours. In years to come, some thorny ones to keep people away

Also it will look better ones the trees bloom

You have a gorgeous home OP. Fingers crossed the right buyer comes along soon. Don’t drop your price now, we’re coming into spring and more people are likely to start viewing properties. Good luck. 🤞

I agree.
OP, Imagine dropping your price now and your buyer decides to sell in 6 months or so and get the original asking price that you were asking for. You could purchase somewhere else and experience buyers remorse there too. The grass isn’t always greener.

@Spotteddaisy Your home has a lot of potential but your layouts and style are making it look a lot more cramped than it should (from the size on the floor plans) and the exterior shots look harsh and bare. If you’re seriously considering selling at such a loss I would spend some money on some support from an interiors professional - I think your home could look a lot more appealing.

My view is house has no charm or period features and the layout seems odd, sofas are everywhere and somewhat cold and uninviting. Same with the garden, it needs areas of ‘interest’ and landscaping somehow. Plus for that amount of money would want two bathrooms. However it definitely has potential but would need money spending so maybe this is off putting.

Before reducing the price OP try walking around your house, photos in hand and consider whether each photo really does that room justice.

i have been in your shoes and been pressured by an EA to keep reducing my price. What I actually needed was a new EA and new photos.

My immediate impressions flicking through your photos and deciding whether I would view is that many of them focus on things that would actually put me off.

Most people view the exterior of a house at ground level, so why aerial photos of the new builds, graveyard and solar panels. Probably none of those things would deter me from buying if I loved the house, but the photos are almost a slide show of potential negatives. When it comes to the interior many of the photos focus on the wrong things. The artfully positioned wine bottle draws attention from the kitchen behind rather than being an enhancement and several of the photos make rooms look cluttered.

You know your house best. Ask yourself is every room being shown as you see it when walking around.

In my scenario I could easily have dropped my price by £50k because of advice that if a house isn’t selling it is always price. Instead I rested the house for two months, found an agent on the basis of whose photographer I liked best, spent £600 on new photos, followed the photographer round the house showing him exactly where I wanted the photos shot from and vetted the ‘blurb’ on the new house details.

It was a different market, but I didn’t drop my price and had two offers within 10 days.

The upshot is I no longer believe the ‘it’s always price’ mantra. Sometimes it is just the EA !!

Lose the photos showing the new builds and the graveyard. They are off putting and once you’re at the house they don’t encroach from the looks of it. Turn off the weird blue light on the ceiling. I’d actually pay an interior designer to stage this house. Take it off the market while it’s being done. Then get new photos taken. It’s just presenting as cheap and a bit soulless.

Some truth in the viability of this strategy I think.
But I think what you did by "resting" it for 2 months was probably more why it succeeded. The ops photo presentation is good enough, quite good actually.
The problem the op has is that everyone who is looking in that area has already seen and discounted the house. Its been on too long. If they re-list in June then yes there will be a number of new potentials who haven't seen it so it might work.
What also will work is adjusting the price downward. I guarantee there are a good number of potential buyers who either haven't seen the house (because its just above thier search price perameters) and would be desperate for it - or have seen it but assume its just out of reach financially.
It depends how much they want to move really. There's always the unpleasant possibility that that 695k offer was actually a good offer should the market in that area continue to drift downward this year...

Sorry if someone else has said this but Rightmove first page says you only have one toilet where your plans look to have three.
unfort being next to a cemetery will shorten your list of potential buyers

A few things struck me when looking at the link.
Firstly the graveyard next door - that would put some people off regardless of whether it’s in view or not.
Secondly there’s no plants or flowers outside to make the house look more attractive. Can you put some planters or pots against the house to brighten it up and make it more appealing? Such a large garden but no plants or flowers. Not sure what value a photo of some steps in the garden which haven’t been swept adds to the listing.
I also don’t think some of the photos are the best. They are too focused on the doors or windows rather than the actual room. Your additional photos are loads better in showing the space. I don’t want to see wine glasses on a counter either - so staged and a bit outdated now. Also decorations wise it’s all a bit too cold and grey rather than warm neutrals but that’s more personal taste.
HTH

That is a MASSIVE garden. You could almost have horses..!

It's nice enough house, clean and pleasantly decorated in a modern style (even if the interior decor is absolutely not to my tastes).

I think the issue is the extension has not added the value you think it has, there seems to be too much pointless space downstairs - there is a lot of fairly non functional looking furniture going on simply to fill up the space. So it looks like you don't really know what to do with all the space you have added.

Also massive garden - a huge bonus for those who want it but it currently looks a bit crap and dull, especially at the front of the house.

The biggest issue however is I would be very suspicious of someone selling a house that big after less than three years.

I think it is a beautiful house but I can only see one bathroom, and it's not even very big (no separate shower cubicle). For what is a large 4 bed house I suspect that's putting people off.
I can also see 4 comfy sofa/seating areas but then the only dining space is squeezed in. The whole of the part attached to the kitchen would be better being a big dining/entertaining space.
Then the huge row of solar panels would put me off somewhat, maybe you can emphasise the financial gains of these in the listing?

Why would you say "even" Iran, that is the main driver of inflation and hence mortgage rates in the world at the moment! The Labour Government and the UK housing market are just dots on the global board, globally they are of little consequence.

I see some significant increases in mortgage rates have started today. Lets hope this doesnt go on for months - because if it does property values could tank 👀 - not just slightly slump. Worrying stuff for another round of cost of living increases too.

Falling property prices are badly needed by UK society, can you imagine the position we would be in now if working people had been able to buy basic homes without a 30 year debt! We would be a nation of savers and investors, and spenders into the local economy instead of at the mercy of the bond markets (those of us with debt anyway) Higher rates are great as are lower house prices, the way we are getting there though is not so great.

you have a beautiful house and garden but the photos really don’t do it justice

I would take it off the market, find an agent that deals with selling the more premium houses in your area.

and take their advice on dressing the house
change the blue lampshades in your sitting room to something more in keeping with the lovely room
and dress the garden so it looks gorgeous in the spring
have those gorgeous iron gates fearless on the sequence

better to spend a couple of grand on dressing the house and garden and sell it for more than the current agent suggests

The gates feature much earlier on in the photo sequence I think.

I don’t think your EA understands your property / garden very well at all. The photos make it look surrounded by new builds at one end but I doubt people in the garden feel that way at all. The photos of the seating area are really bad you could stage the seats just for the photos then move them back.
I wouldn’t have your car in the photos either
close ups of a swing are also strange

it looks like a lovely garden but the photos are really poor

You need to stay there for at least another two years. The economy is very unstable right now and this Iran business is also causing problems. You will lose loads of money if you don't.
There is no such thing as bad luck. There is no way i'd be buying a house or selling one right now. You would be mad to sell now.

I really do think the issue is the bathrooms. I can see the living space is huge but one bathroom is not enough. It’s nowhere near the main bedroom and it’s difficult to see how that can be changed. It’s a house designed for you but feels small on the first floor. I guess price reduction or sticking it out because dc have friends. Plus what about disruption to schooling? Weymouth is ok but not the best bit of Dorset. Does that make a difference ?