First offer

Peonygrace

Hi all
I'm a first time buyer with a small mortgage fully approved
Found a good house 3 bed (you'd want to either extend or knock a wall to make it 2 bed though, teeny rooms) in an ok location (not a desirable location but I know the area and like it a lot, convenient for work and crèche also)
The house is in an area where other houses on the street are selling around the 100k mark.
He is asking for 125 and hoping for 130....the ea told me he bought it for 80k two years ago and has put 40k into it, unless he buried it in the garden I really don't see how this is possible. It is in decent livable condition but done up cheaply....v cheap f&f.....smell of damp downstairs alarms me, as does the fact that the shower room is practically in the v. Small kitchen, and there is a damp stain where the shower pipe seems to be, on the interior living room wall.

New boiler but it's a small baxi boiler, everything looks pretty basic to my untrained eye.
I think he said triple glazed windows?! Is this even a thing.....

These things considered, I want to make an offer of 100k but Is this outrageously low?
The ea thinks (of course) 125 is fair. I don't know how this works, really. They say offer what you think it is worth. Would this be offensive?

Across the road a total wreck just went sale agreed for 95k
I feel a bit cheap going in so low, but wanted to leave some wiggle room also.
I have approx 120k to offer in full but would only go up to 110 for this particular property I think.....

What I do like is the fact that there is garden space back and front, and room for extending out the back in future.....
On street parking.

Your advice is much appreciated.

Ps it's been on for three weeks with a number of viewings but no offers yet.
As far as I can tell, the properties I am looking at all have offers within four weeks of being put on the market....so I don't know if this supports my feeling the house is simply not worth that much!

The ea sold across the road for 102 end of last year and maintains they would get 130-40 for it now which I do not believe.

MarkAnthony

Trippe glazing is relatively expensive, could have sunk considerable money into that alone. Other than that you wisely seem to be taking most of what the EA is saying with a pinch of salt.

Ireland is a strange one, I always take any offer on anything I'm selling seriously. It might be a simple no thanks but at least it shows interest. I think you've two options:

(i) Go in at 110K and stand firm. Say you really like the house and for a quick sale you'll go in with your final offer no messing.

(ii) Go in at 101K and wait for a reaction. If they're insulted by it they weren't going to take 110K anyway so you've lost nothing.

Either way pick a top price and stick to it! Check out the property price reports on daft and myhome, apparently there are significant rises hitting places outside the pale.

Peonygrace

Thank u MA for quick reply
what would you do....a or b?

If i say 101 and they balk at it....could i leave it and watch for a while and if no movement come back and say 110 is my final offer or will i just look ridiculous? As u say they wont likely take 110 if rejecting 101...

Not sure why i care what they think of me...but ive never done this before and im relatively crap at poker!!

Rackstar

Start with 95k. Tell the EA you don't like the windows and would have to replace. Tell them there's a leak and the place smells of damp.

MarkAnthony

I went in high on mine as I had another place that had gone to best and final offers. To me €20 a month on the mortgage doesn't bother me, others will make out I just slapped their granny and peed in the sink for a comment like that!

You'd wait for an accepted offer then renegotiate if issues come back on the survey. If you're sure there are issues then perhaps a higher bid with a reduction/onus on them to fix things. You'll get as many different opinions as you'll gets posts tbh!

The very best of luck with it - I hope you get it.

ted1

MarkAnthony wrote: »

I went in high on mine as I had another place that had gone to best and final offers. To me €20 a month on the mortgage doesn't bother me, others will make out I just slapped their granny and peed in the sink for a comment like that!

You'd wait for an accepted offer then renegotiate if issues come back on the survey. If you're sure there are issues then perhaps a higher bid with a reduction/onus on them to fix things. You'll get as many different opinions as you'll gets posts tbh!

The very best of luck with it - I hope you get it.

It's about 50 euro a month for every 10k.
So 20 euro would only put you your offer up 4k.

Would you consider an extra 4k as going in high or did you make a mistake with your figures?

Peonygrace

Rackstar wrote: »

Start with 95k. Tell the EA you don't like the windows and would have to replace. Tell them there's a leak and the place smells of damp.

He will say the wreck across road went sale agreed for 95k last week.

i say i was viewing that and dropped out early as its not worth 80...thats a cash buyer who will do up v cheap and flip it. Also it has a big bathroom w bath, stellar view of cork, large.attic conversion and off street parking which this house does not.

i am worried about the damp and cant see where 40k has gone....would need to extend out the back and put in a proper bathroom cos we have a child. House is small and considering those points and local property register, thats my justification for my offer. What do you say?


Do they typically come back with counteroffers or tell you to get lost if you go in low?
Thanks!

Peonygrace

Ps the windows are triple glazed prob best thing in the house :-/

ted1

Peonygrace wrote: »

He will say the wreck across road went sale agreed for 95k last week.

And you tell him that your not buying the house across the road , that your making an offer on this house

John Mason

Do you have the 50-60k to extend? if not, I would walk away, the house sounds like a nightmare.

too small, bathroom not big enough, damp.

I bought a doer upper 11 years ago and I am not still not finished doing everything

johnp001

http://www.boards.ie/vbulletin/showpost.php?p=96140361&postcount=2

gaius c wrote: »

The old rule of thumb is that if you're not embarrassed by your first offer, you've offered too much.

MarkAnthony

ted1 wrote: »

It's about 50 euro a month for every 10k.
So 20 euro would only put you your offer up 4k.

Would you consider an extra 4k as going in high or did you make a mistake with your figures?

Not with the interest rate and length of mortgage I have. Admitadly it might be more than 20 but it's less that €50 for 10K. Either way you're point is you feel your granny has been slapped here Ted?

Peonygrace

I would have 40...

what condition was the house u bought in?

It is small but not *too* small for our needs. The bathroom is the major downer though. The pluses are locatio re proximity to work,, rear and front gardens, space to work with if needed.

Trouble we are having is finding turnkey houses at our price point whereas this one is the most liveable i have seen. That damp seems to be an isolated leak from shower but want to use it to bargain down.


uote="John Mason;96174348"]Do you have the 50-60k to extend? if not, I would walk away, the house sounds like a nightmare.

too small, bathroom not big enough, damp.

I bought a doer upper 11 years ago and I am not still not finished doing everything[/quote]

MarkAnthony

We looked at everything from listed wrecks (came oh so close but glad we didnt!) to new builds. Eneded up buying a house built on a corner site about 13 years ago with issues on the title over one (of the four!) gardens. I've a legal background so hopefully I can keep the costs down in sorting that out over the next number of years.

I went in 15K over asking; we loved the house and I wanted to shut anyone else out. In terms of the cost of the house that was a big chunk. That said I have the house I want in an area on the up swing. The problem is where I am is very difficult to compare. Behind me are two houses going for 560K I paid no where near that although my house is 100m2 where as they are 150m2. Down the road is a 3 bed a little smaller than ours going for 220K but with no where near the land we got.

The house was walk in condition with loads on extras included. If there was a lot of work to do I'd maybe have been more cagey to be fair. When I bought though it was madness over the new mortgage rules so again, my situation was significantly different.

Justb realised that question was probably not directed at me :pac: oh well posted now!

spaceHopper

Sometimes you are better of buying the wreck that you can put money into rather than a "good" house which you end up having to do everything to in the end. I'd go in at 100 K and list the problems which need to be addressed, tell the EA you might be able to find 5 or maybe a max of 10 K more but would be happy to keep looking all the same. That gives the EA something to show the client and leaves it up to him to say OK you can have it at 110. Don't come back with another offer if they reject the 100K, move on and keep looking if you go back it at 110K they will hold out for more. As you will have a kid living there make sure to get the damp looked at.

Peonygrace

He outright rejected 100k and said 120k is the minimum he will accept. I said 110 is my absolute max so to avoid wasting anybodys time with increments.....He can tell him my offer and if he doesn't like it then no worries that's the name of the game. We want to move quickly on the right property so will continue our search if he won't go for it..confident we will find our home at that price.
EA said would speak to him tonight again and be in touch.

We shall see.

spaceHopper wrote: »

Sometimes you are better of buying the wreck that you can put money into rather than a "good" house which you end up having to do everything to in the end. I'd go in at 100 K and list the problems which need to be addressed, tell the EA you might be able to find 5 or maybe a max of 10 K more but would be happy to keep looking all the same. That gives the EA something to show the client and leaves it up to him to say OK you can have it at 110. Don't come back with another offer if they reject the 100K, move on and keep looking if you go back it at 110K they will hold out for more. As you will have a kid living there make sure to get the damp looked at.

MarkAnthony

Just make sure you set a max and stick to it! Luckily I have my wife who keeps me grounded.

Peonygrace

Won't budge on 110 so we will see what they think. If it doesn't sell at 125 which I don't think it will maybe they will come back to us. Thanks all for the advice!

athtrasna

Peonygrace please take care when posting, lots of your posts are double posting. I have removed a number of duplicates. Thanks

Mod

Peonygrace

Sorry Mod don't know what happened there.

So, we offered the 110 and he came back and said if we could meet him at 115 that might be considered.

Debating now, because if the bank valuation is is line with what I am thinking, this house isn't worth that.

So, should I stick to my guns at 110 and see if they come back if no one else bids, or will I meet them at 115 based on the shower leak etc being sorted in full.....and see? I wondering if the agent is just trying to tease out how much we can afford.

Thinking I should bide my time here. Looking at another property at 120k but it would need money put into it and with small baby don't really know if I can deal with that at the moment. This house can be moved straight into so while I could afford the 115k, I think he is taking advantage of prices going up and overselling the renovations done.

Can I ask, if we go with the 115 and the bank come back and value it at 100-110k could we use this as leverage to get him to go with our original offer....OR would we be better off to stick to 110k just step back and wait and see what happens here?

I really wanted to stick at 110 as my max. Could manage the 5k if needs be but don't want EA to know that, and as I say don't thi it is fair.
I would normally just wait it out, but with small baby and imminent return to work I also want to be done with this whole process as quickly as possible and this is most decent house I have seen at our budget so far......

Here is what I was thinking of saying:

Would love to be able to meet him half way but simply cannot afford it. Would want to be putting in a bath down the line and that money we do not yet have would be very useful towards that work. There is also the major concern of the shower etc. also, I did notice a beer bottle hidden in the front wall of the garden so I am concerned there might be a lot of loitering/drinking activity on the street which would not suit us.....our offer stands but is only on the table until the end of the week, and conditional to him sorting out the shower etc before any further action is taken.
Otherwise we are happy to keep looking for now.

Is this reasonable?

Thanks all.

alastair

I'd lose the stuff about the beer bottle / loitering tbh. It makes you look like a potential messer - If the property 'doesn't suit you' because you've an issue with the street, is your offer a serious one or not?

Peonygrace

Thanks. Yes my offer of 110k is a serious one, but it is very clear the agent is spoofing us re:amount of money put in to the property which has clearly been done up to sell, with cheap everything. I feel he is trying to test our limit as we seem to be the only bidders as yet....

As a ftb I'm going on instinct and common sense here....other properties are selling up to 100k on and around the street....he maintains one he sold across the road last December at 102 would go for 130-140 now. I don't see how...maybe I am wrong!

The street seems okay tbh, just thought leaving the beer bottle there was sloppy of them and it did raise the question! I guess trying to think of all the reasons to justify myself staying at 110k. You are right, lame idea.

I think 110 is a very reasonable offer.

The damp/apparent leak in shower is my only true concern.

I don't want to lose the property for the sake of 5k, but on principle I guess I don't just want to hand it over if I don't believe the agent. He says 40 went into it, I say probably 15.....which means he is making 30k on it if he accepts our offer of 110.

I guess if I am right the bank valuation will tell us that anyway.

What would you do?

Dr Strange

Peonygrace wrote: »

...

I guess if I am right the bank valuation will tell us that anyway.

...?

Sorry to butt in here on this but I thought a bank valuation will only give the rebuilt value of the house, particularly in cases where you get your life assurance policy through the same bank you have your mortgage with? This may not be correct but that was my understanding of a bank valuation.

MarkAnthony

Preusse wrote: »

Sorry to butt in here on this but I thought a bank valuation will only give the rebuilt value of the house, particularly in cases where you get your life assurance policy through the same bank you have your mortgage with? This may not be correct but that was my understanding of a bank valuation.

It's what they think they can safely get for the house if they were to sell in the case of default.

Dr Strange

MarkAnthony wrote: »

It's what they think they can safely get for the house if they were to sell in the case of default.

Thank you. Is the rebuilt valuation just something for the house insurance then? Can't remember where I got it from but it sticks in my mind somehow.

farrerg

Preusse wrote: »

Thank you. Is the rebuilt valuation just something for the house insurance then? Can't remember where I got it from but it sticks in my mind somehow.

It's also on the valuation, they give a market value and a rebuild cost which can be hugely different depending on where you live. Rebuild is just to set the level of home insurance required to protect their asset

Dr Strange

farrerg wrote: »

It's also on the valuation, they give a market value and a rebuild cost which can be hugely different depending on where you live. Rebuild is just to set the level of home insurance required to protect their asset

Thanks!

MarkAnthony

Preusse wrote: »

Thank you. Is the rebuilt valuation just something for the house insurance then? Can't remember where I got it from but it sticks in my mind somehow.

Yep, that's the one. Your buildings insurance is the rebuilt cost as you would already have the site.

MarkAnthony

audi12 wrote: »

you might not have heard but the market is in trouble

OP is clearly not buying in Dublin at the prices mentioned. You may not have heard those markets are still quite buoyant.

spaceHopper

He said if you go to 115 they might..... not would. Ask him have they a better offer.

Bank valuations aren't that detailed i don't think they would have a problem with 115 it's really down to you are you happy to pay it.

If you do offer 115 tell the EA that if it's not accepted the offer is withdrawn

Peonygrace

Hi all just to say thanks for your advice here, and I am glad I didn't get this house in the end.
Have now had offer accepted on a cheaper and better option, in a better location.
Contracts are in process, and speaking with architect and QS and bank and just crossing everything that it works out.....

Now to embark on the scary road of renovation on a budget.
I am closing my ears to pessimists and hoping I don't live to regret it!