Buying & Selling

20LEgend

Hi,

Me and my girlfriend have identified a house we would like to make an offer on. We both own our own individual properties (mine is owned jointly with sister).
The thing is its going to take a few months to market our houses and sell them but we would like to make an offer on the house we want before then.

The house we are interested in is a newly built rural house so it is a builder selling it.

The question iam asking is what is the options available to me in making trying to buy the house.

i.e. could i agree the mortgage in principal with the mortgage company on the condition of us selling our houses (we want to sell them), make a bid for the house before we sell our own (maybe pay a deposit to hold the house) and then when we have our houses sold draw down the mortgage and finalise the purchase.
Obviously this will depend on whether the builder wants a quick deal (the house is a couple of months away from being finished)

Sorry about the rambling!! Is whats outlined about possible or any other suggestions?

Thanks

Gurgle

20LEgend wrote:

The thing is its going to take a few months to market our houses and sell them but we would like to make an offer on the house we want before then.

The house we are interested in is a newly built rural house so it is a builder selling it.

The question iam asking is what is the options available to me in making trying to buy the house.

i.e. could i agree the mortgage in principal with the mortgage company on the condition of us selling our houses (we want to sell them), make a bid for the house before we sell our own (maybe pay a deposit to hold the house) and then when we have our houses sold draw down the mortgage and finalise the purchase.
Obviously this will depend on whether the builder wants a quick deal (the house is a couple of months away from being finished)

Sorry about the rambling!! Is whats outlined about possible or any other suggestions?

Thanks

Yes, thats all absolutely normal.
Its pretty much what everyone does when they move house.

Make an offer, wait until its accepted then get your houses on the market. It might be as well to mention to the builder that you have to wait until your house sells to close the deal. He will probably want a deposit, just in case it takes you forever to sell.

But then, if he says he is 'a couple of months' from finished, you will probably be ready before he is. You would be doing well to be in by christmas.

20LEgend

Thanks Gurgle. Just wanted to clear it up in my head before i get down to agreeing mortgages and making offers etc!!

Cheers

Sponge Bob

Liquidity is everything nowadays , start off by getting cash for the existing house(s), even selling one and keeping the most rentable _may_ be enough .

The "most rentable" is the one that pulls in €1000 a month and is worth €300k not the one that is worth €200k and pulls in €500 a month ..do the math.
Proximity to a rented asset is not a bad idea either, no point living in Leitrim and keeping an eye on a house 100 miles away.

Also note some rural areas have massive oversupplies and you can get a lot of 'extras' out of the builders in the negotiations , this applies to north leinsters/s ulster/e connaught for example. That plan will not work in Wickila though as there is no oversupply

Rural houses are often a "builders finish" , you basically get a shell and must do all the second fixes (kitchens bathrooms floors) yourself. That finish can vary by as much as €50k and the bank will be a lot more amenable to finding and extra few €€ to finish the job if you have sold and have cash in the bank.

Assume a good finish will cost €120 a square foot and a fantastic finish with the best of materials will cost €150 a square foot. Then theres landscaping, the builder may have a JCB while you do not so that may be where you get the builder to throw in an "extra" even if its only a crudely levelled topsoil and kerbs and gravel and rocks removed .

You can then do the rest with a wheelbarrow and shovel

But above all do the math and do not get landed with 3 unsellable houses and chronic illiquidity.

20LEgend

Thanks spongebob.
The problem is that the house we like has an offer on it (which has been rejected) so its highly likely that we will have to make an offer before we sell our places.
Another question spogebob, is it possible to include in your mortgage the cost of the 2nd fix (kitchens, floors etc)?

Thanks

Sponge Bob

long story mate, if you do not ALREADY have 2 mortgages then yes , you get avaluer to value the "end product" as it were.

if you already have 2 mortgages the banks will be less helpful, hence liquidity .

that offer may well be a phantom bidder so you are offering against yourself , where is it and how long is the builder trying to shift it , if in the midlands then reduce your offer by €1k and resubmit so they know you know the score ??