Buying a house - is it overpriced & what to do about it?

Breezer

First time buyer here. I've found a house that I love. I was watching it a few months ago before I had sufficient deposit. It went sale agreed at the asking price but the sale fell through and it's now back on the market at the same price.

At first I thought the price was fair, but I've discovered another house on the same road, same style, approx. same size, sold for 100k less a few months ago.

There's a few differences:
- the one I'm looking at is finished to a much higher standard
- both are extended to a similar size but "my one" arguably has a better layout
- "my one" has parking available, albeit on street. The other one, while technically entitled to use the same spot, has nothing in front of it. Parking on this street is very limited and I'd imagine if anyone parked in front of someone else's house there'd be war.
- there's a small brick outbuilding/shed in "my one" which is plumbed and wired
- "my one" is end of terrace. The other one is mid terrace. The garden isn't worth talking about but it means I could likely put in a side window to light up the dark front room. The other one would be darker I reckon. Although this window doesn't exist yet.

I don't know if this makes up 100k of a difference. My offer (and mortgage) will obviously be subject to valuation, but could the price difference be so huge that I'm barking up the wrong tree altogether here? Affordability isn't an issue, but I want to get my money back when I eventually sell.

Should I offer the asking or near it and just wait for valuation, and potentially have to revise it something crazy? Or go in way under the asking and potentially annoy the seller and EA? Bearing in mind they previously got an offer of the asking.

Brioscai

Offer less if you think it is overpriced. If it is very up to date, don't forget that it is hard to add value. If a lot of housing stock becomes available over the next few years, you may find it hard to shift, having overpaid. You don't seem to be thinking long term in it.

Breezer

I'd be considering adding a downstairs window to create more light, and adding an upstairs extension (decent en suite) if possible. I am thinking of longterm to be honest, certainly at least 10 years and possibly much more, but you never know how plans might change.

pilly

My advice would be if you're buying as a home buy a house you love. 100k does seem a huge difference. Maybe the last sale fell through because of the valuation. Can you get a valuation done before making an offer ?

Breezer

pilly wrote: »

My advice would be if you're buying as a home buy a house you love. 100k does seem a huge difference. Maybe the last sale fell through because of the valuation. Can you get a valuation done before making an offer ?

No idea, this is all new to me. I could ask.

pilly

Breezer wrote:

No idea, this is all new to me. I could ask.

Don't ask the sellers agent. Get an independent valuation.

johnnyskeleton

100k on a 2/300k house is much more significant than 100k on a 1/1.1m house.

Ultimately the house you are bidding on sounds better. Its ultimately up to you what youre prepaed to pay.

And there are no guarantees that you'll get your money back no matter what you buy!

L'prof

It's only "worth" what people are willing to pay for it. All those extras, especially being semi-d do add to the value of it though. If you're buying in Dublin then maybe the €100k difference is about right, if it's elsewhere then maybe not!

ted1

Breezer wrote: »

I'd be considering adding a downstairs window to create more light, and adding an upstairs extension (decent en suite) if possible. I am thinking of longterm to be honest, certainly at least 10 years and possibly much more, but you never know how plans might change.

An upstairs extension could cost 100k or there sbout, have you allowed for that ?

Breezer

pilly wrote: »

Don't ask the sellers agent. Get an independent valuation.

Definitely.

johnnyskeleton wrote: »

100k on a 2/300k house is much more significant than 100k on a 1/1.1m house.

Ultimately the house you are bidding on sounds better. Its ultimately up to you what youre prepaed to pay.

350k-ish vs 250k-ish. It's a better house, without a doubt, but I don't know if it's that much better. There's also another one down the road at the same asking price. Extra bedroom and half the square footage again. Different style and I personally don't like it but it does lend weight to the overpriced theory I think.

L'prof wrote: »

It's only "worth" what people are willing to pay for it. All those extras, especially being semi-d do add to the value of it though. If you're buying in Dublin then maybe the €100k difference is about right, if it's elsewhere then maybe not!

It's in Dublin.

ted1 wrote: »

An upstairs extension could cost 100k or there sbout, have you allowed for that ?

Nope, not at all, potential long term project, currently pie in the sky and totally unnecessary!

bleary

Unless you were involved in the bidding for the other house you don't really know why it was so much cheaper, it could have been a family sale, they may have found survey issue, bank sale drawn out for a long time etc.so it could have been undervalued.
I would probably think the parking would have been the biggest issue
I bought a house for a little less than the house next door for no real reason other than vendor fatigue I think.
Valuation is a complete waste of time, there is no right price. Estate agents use experience to value but in the current market it's a rough guess. Offer lower than asking and a quick uncomplicated sale with offer letter from bank in place etc .

Penalty

Bear in mind if it's a public street people hCan park where they want. Just because there is a space outside your house does not make it yours unless it's allocated to you officially (private estate) - anyone has a right to park there particularly if it's a busy street with limited parking

Grawns

I've seen similar cases and couldn't figure out the giant disparity between the asking price of one house and the sold of a similar. My guess is it's down to the vendor not being really keen to sell. Maybe the bank is encouraging them to sell and they are stalling. Is it owner occupied?

Nothing to stop you making an informed and reasonable bid.

Ayuntamiento

Having been on the market for the last year, i've noticed often inexplicable price increases in virtually identical properties being sold this week versus 6mths ago. Maybe not quite 100k, but enough to explain away the difference with your property when all the other selling points are accounted for. I think a lot of new buyers have arrived on the market this year.
I've gotten to the point now that I'm happy with the price i'm paying for the property I'm buying. It's not a bargain but we have bought a home that will do us for the rest of our lives. It's in our perfect location and also has scope to extend. The repayments are affordable. Its market value fluctuating will have absolutely no effect on me as I won't need to resell for many decades. If that's where you're at, go for it.