Revised house offer before signing contract?

CuppaCocoa

So my partner has gone sale agreed on a house she wants to buy. There was a lot of messing around with the vendors selling privately (she made them two offers, both rejected) and then with an estate agent when her offer was finally accepted. Contracts are ready for signing (4 months later!) but house prices have dropped again in the estate she's buying in and I think she offered far too much.

What would you think about her revising her offer at this late stage to say 10k less? The house needs about 80k worth of work to it. The only reason she wants this particular house is because of family nearby in the estate. She has only paid the booking deposit so far. Is this a big 'no no' or is it common practice?

meditraitor

lilybarlean wrote: »

So my partner has gone sale agreed on a house she wants to buy. There was a lot of messing around with the vendors selling privately (she made them two offers, both rejected) and then with an estate agent when her offer was finally accepted. Contracts are ready for signing (4 months later!) but house prices have dropped again in the estate she's buying in and I think she offered far too much.

What would you think about her revising her offer at this late stage to say 10k less? The house needs about 80k worth of work to it. The only reason she wants this particular house is because of family nearby in the estate. She has only paid the booking deposit so far. Is this a big 'no no' or is it common practice?

No Contract, she can do what she likes.. No harm in making a new offer. As you said prices have gone down.

mathie

The outcomes would be ....

1 They say no and tell her the deal is off.
2 They say no and say it's the agreed price or no deal
3 They accept the 10K less

The question is does she want to take a gamble?

*cough* buyers market *cough*

CuppaCocoa

mathie wrote: »

The outcomes would be ....

1 They say no and tell her the deal is off.
2 They say no and say it's the agreed price or no deal
3 They accept the 10K less

The question is does she want to take a gamble?

*cough* buyers market *cough*

Hmmm....she is very reluctant to make the revised offer mainly because she knows the neighbours and wouldn't want them talking about how she shafted the sellers!:rolleyes: I live in the estate myself and couldn't give a monkeys about the sellers feelings! The house belonged to an elderly lady and its not like there was a mortgage on it. Its been unoccupied for over a year!

xE

There's no contract at the moment. A counter-offer of 10k less would be a fresh offer which can either be accepted or rejected.

JoeyJJ

Hell ya, if she is a first time buyer she could use the new 1% stamp as an excuse.

Wasn't there a approx 14% reduction last year, so I would try for 10k or approx 4% which ever is more.

CuppaCocoa

She's not a first time buyer. She sold her house in August which the sellers know!

zac8

Is there anything in the surveyor's report that she could use to renegotiate? It used to be considered bad form to gazunder unless you had a legitimate issue like something picked up by the surveyor, but it's a different playing field now.

The fact that the house is empty for the past year means that the seller is unlikely to take the hump and pull the plug. But then, you never know...

Plates

http://en.wikipedia.org/wiki/Gazundering

Gazundering is the practice of demanding a reduction in price to secure the sale of a property. This is usually done during contract negotiation. The timing of this demand is usually intended to prevent the seller from rejecting the lower price, as the sale could collapse if they did, although it may also reflect a genuine downturn in property prices in an area

It's a buyers market - so I reckon this is happening a lot.

JoeyJJ

So she is probably better off with the stamp duty, still no excuse, gazunder away.

JoeyJJ

You could say the bank has revised its mortgage lending and is only willing to give you less.

CuppaCocoa

Unfortunately she made the offer after reading the surveyors report. Her first two offers were rejected. The surveyor said not to go above a certain price and that was the price that was finally accepted. The house was surveyed in May and I wonder would it be worth it to have it re-assessed to determine its current value? The house proceeds are being split between siblings so they may not mind a price reduction?

CuppaCocoa

JoeyJJ wrote: »

You could say the bank has revised its mortgage lending and is only willing to give you less.

No mortgage, cash buyer which they know!

zac8

Cash buyer looking to buy a property that has been empty for a year? Your partner couldn't be in a better position. Bear in mind that if the seller is prepared to accept a reduced offer they will almost certainly look to split the difference so you should factor that into a renewed offer.

CuppaCocoa

zac8 wrote: »

Cash buyer looking to buy a property that has been empty for a year? Your partner couldn't be in a better position. Bear in mind that if the seller is prepared to accept a reduced offer they will almost certainly look to split the difference so you should factor that into a renewed offer.

I know. It's being split 4 ways so maybe €8,000 wouldn't hurt so bad!

zac8

lilybarlean wrote: »

I know. It's being split 4 ways so maybe €8,000 wouldn't hurt so bad!

That's a good way of looking at it. I hope you can persuade her to do the right thing

CuppaCocoa

zac8 wrote: »

That's a good way of looking at it. I hope you can persuade her to do the right thing

Thanks, gonna work on her at the weekend!

The_Conductor

If the offer was made on the basis of a survey in May- to be totally honest with you- I would reduce the offer by at least 8% and probably closer to 10% (irrespective of what the offer is) if they have dragged their heels in closing.

Regarding not wanting the neighbours to know that she shafted the sellers- thats the biggest load of poppycock I have heard in a long while. The sellers dragged their feet in a falling market. A reasonable market value for the property is a hell of a lot less now, than it was 8-10 months ago (and its continuing to fall).

So what that she is a cash buyer etc- well done her. However does she want to butter up the neighbours at the cost of 20k (or whatever) to herself? I think she'd be stark mad to consider what the neighours think.......

She is a cash buyer. Cash is king. If the sellers dragged out the sale- there is a cost associated with their tardiness. If she walks away from the purchase, which is entirely her perogative- you can be damn sure the sellers will not get a comparable offer elsewhere.

S.

liger

smccarrick wrote: »

The sellers dragged their feet in a falling market. A reasonable market value for the property is a hell of a lot less now, than it was 8-10 months ago (and its continuing to fall).
S.

In a similar situation at the moment. Agreed a price back in Nov and have everything in place but the seller is dragging their heels big time. Took 3 attempts from the solicitor to get a reply and they said something about delay in getting title deeds or some rubbish.

The house is empty about a year. I made a real low offer on it and finally agreed a price 23% lower than the asking price which had just been reduced by 20k. However the house does need some work done, i'd say about 10 - 15k to bring it up to scratch.

Now with all the delays i am getting so annoyed and frustrated and have considered both reducing offer and pulling the plug. A house in the same estate just came up for rent although that would work out about 250 a month more than the mortgage.

I can see why they say buying a house is one of the most stressful things you can do!!!!

Brian2850

Its amusing to read every comments encouraging the OP to renege on the deal agreed with the seller. I would love to see the reaction if a developer came on here and said he was considering doing the same to a first time buyer by uping the price at the last minute!

Dont get me wrong, you've got to look out for yourself in this market and passing up a saving of approx 20K just to keep people happy is hard to justify but this situation is the exact same as the one that drew so much criticisim in the boom years.

liger

I think a lot of people here would have gone thru the experience in the boom of making a deal only to find out there was "ANOTHER BIDDER" suddenly on the scene and being asked to up their offer.

I know I did and i know i want the best deal available for me now. If that means putting in a lower offer because the guy selling wont pull his finger out then so be it.

Brian2850

I agree with you that the plenty of people will have experience with Gazumping in the boom years and I'm sure its not a pleasant one.

If you agree your deal and the seller drags their feet to the point where the delay is unreasonable, then I have no objection with people pulling the plug on that basis.

But what the OP is suggesting is that they lower their asking price based on market movements. That is slightly different.....

Kosseegan

The easiest one of the lot is to say that your mortgage approval has expired and now there is less money on offer. No need to worry about neighbours.

liger

Brian2850 wrote: »

But what the OP is suggesting is that they lower their asking price based on market movements. That is slightly different.....

But isnt that exactly what happened in the boom, just now the shoe is on the other foot.

Kosseegan wrote: »

The easiest one of the lot is to say that your mortgage approval has expired and now there is less money on offer. No need to worry about neighbours.

Seeing as mortgage approval with some places is valid for 3months now thats true more now than back in the boom, But i believe the OP is paying cash.

JuliusCaesar

4 months........get the house re-valued.