Buyer wants £8k off parents' London flat just before exchange

[LondonSeller]

Parents flat for sale as they passed away in london - Took 18 months to get probate sorted out but finally got it - Property listed with agents and it is in dated ocndition and needs work - Also has a 70 year lease. EA told us not an easy market

After five weeks advertising price agreed at 500K which was a bit lower then we had hope for but EA told us buyer is known to them and this would be very quick sale

Was meant to exchange on Friday and EA has come back and said buyer is ready to exchange, has sent deposit monies to his solicitors but wants a reduction of 8K. EA has said this is less than a 2% drop so not massive and believes we wont get better if we reject the offer

Buyer is cash purchaser investor so quite rare and I worry that if I dont accept property will be stuck for months for anothr cash buyer who might offer lower.

I live in Scotland and the flat is in London so I am miles away - Paid to have the place emptied and solicitor fees so am already down. By contrast buyer has not paid anything other than a few hundred for solicitor fees - No mortgage, no survey fees nothing

Whats the best angle here - Call buyers bluff and risk losing the sale or take the money and run. Feel quite cross as this money was going to be used for real stuff and to clear debts

It does seem like a small price to pay, to secure the sale OP, but it’s a dirty trick all the same. Similar happened to us when we last sold, a few years ago. We went back with a firm ‘no’ and stuck to it. After a bit of back and forth the buyers accepted that we weren’t going to play their game and the exchange went ahead. Having said that it was a better market than today, our home was freehold, and we hadn’t incurred any more expenses than the buyer at that point. You’ve also got a cash buyer - another major consideration. Can you not counter offer a bit lower and see what happens. What’s the £8k reduction based on ?

I would accept the reduction and move on with your life.

I'd refuse. I've bought and sold many times and don't deal with scum. The more people accept last minute blackmail, the more it becomes normalised.

You are massively underestimating the renovation costs plus stamp duty is not included in your sums. Take the risk and re market it if you feel you can get more money.

It's annoying, but a bird in the hand and all that.
Accept the reduction.

Take it. The London flat market is dead. Selling a flat like yours is near impossible

OP, it’s filth, but it’s what the purchasers did on my DM’s house after she died - we wanted rid so grit our teeth and took it, but it does leave a very nasty taste. If you can meet half way, that’s probably your best bet.

They want your flat as they know they’ll make a good profit on it when they’ve done a few cheap improvements and they’re playing hardball to squeeze more profit from their eventual sale.

I’d counter their offer with £4k drop as final.

The buyer will also pay legal fees, stamp duty and insurance costing around £45K altogether; there is presumably also some sort of liability for ground rent and service charges. It's highly unlikely that renovation costs will be limited to £20K, given that they probably need to gut and replace both the kitchen and bathroom, and probably rewire and put in new central heating.

As it's only been on the market for a month I think you could gamble and refuse - I'd think of moving estate agents too, it could be that they have an on-going business relationship with the buyer, they don't seem to be trying to get the best price for you.

To advise you to drop £75k over the short lease is very poor - they should have taken the short lease into account when advising on the advertised sale price.

If it was just £8k for a quick sale, you could suck it up, but on top of £75k, that's a big lose.

I know you think it's a lot of hassle, but I think you should extend the lease yourself - you should be able to get a loan for it. Will make the flat more attractive to a lot more buyers.

I know it's an inheritance, but your family members worked hard to buy their flat, and would want the benefit to go to their family, not to benefit a property developer who wants to short change you.

Have they given a reason for the reduced offer or are they just chancers I'd only agree if it was the final,offer and they exchange complete the same day. Even if you agree they could still pull out or ask for another reduction,

Very annoying but I’d take it. We’ve just sold for way below our asking price but we sucked it up as it’s a terrible market.

How desperate are you to sell? Why did you hope for more than 500k in this market? A flat is a very wide spectrum. If not desperate, I’d tell them to F off.

They underestaimted the cost of lease extension and refub will cost much more than they had budgeted for is the reason given - All pretty lame excuses

They agreed to exchange Monday and complete by friday so I think they are serious that this is the final price they will negotiate at

That doesn’t sound very savvy.

You’ll be paying that in extra costs keeping the flat if they withdraw. (Extra council tax, service charges etc). It could be on the market again for months or longer. And as you say, their outlay so far has been minimal so there’s no costs for them to be concerned about.

I’d accept the drop.

Did you have any other interest?

A flat is worth what anyone is prepared to pay.

I don't think buyers can get a mortgage on a flat with a 70Yr lease? Or not a good rate. So this is going to sell to a cash buyer investor. Who will almost by definition pay dirty tricks.

You could maybe ask the solicitor to reply to their request with that? I think they are being v cheeky.

Exactly. Everyone should heed this.

Refusing the price drop is not the end of the conversation.

I’ve been buying and selling property professionally for over 30 years. This is simply a developer tactic. You must negotiate.

If the auction house quoted 450k max then the reality of something in the high 300k's is what may be the fact at the hammer drop.
Your really fortunate to have a cash buyer, flat prices in London are continuing to fall in most areas. If you go back on the market to try and find another cash buyer in a falling market you may regret it... The result could be a lower price for you.
It feels cheeky I know, but dont take it personally, its just business and the extra reduction is small.
Get it done - I really wouldn't be suprised if flats in Z2 are worth 20% less than they are today by this time next year.

Iam going to accept the drop and get shot of it - In 2020 this would have got 600K even with the short lease so I cant believe that flats have gone down 20%

If I was close by I would have increased the lease and done the refub work but I am too far to make that happen so I will just get rid of it

Winkworth were absolutely terrible agents

They’re cash investors they don’t need a mortage. They will gut the place and extend the mortgage.

It’s cheeky and irritating, but if just take the drop and get it done.

Just say yes then it's not worth the grief, you'll still be getting nearly half a million and you'll be happier when it's all settled. Just ensure you have everything in writing and I'd ask for a quicker completion, there cash buyers so doesn't. Need to be any delay.

Take the money and run