The thing is, how can you expect it to be 330k to be sold when banks down-valued it?Negotiating after the fact will always carry some degree of risk. Mortgage valuation will play a part, an in-depth survey could throw up expensive work required as well, I don't think you should never negotiate based on these factors, but if you do I think it's best to be prepared for the eventuality the seller could walk away. Until exchange of contracts nothing is legally binding.
A lot of people can't afford the additional after a down-valuation by a surveyor from the officer price, but I suppose the difference here might be the advertised/expected price and the offer made, for example if I list a house for £300K and EA goes "yep £300K is about right" and then a buyer comes in and offers £330K to secure the deal, then I'd not be too happy about them coming back to me later and asking for £300K instead because their lender values it at that price. I'd be expecting the person offering above list price to realise they'd potentially need to fund that gap.
On the other hand, if someone offers £300K and the valuation came back £270K, then at least they could have not foreseen that as easily, I'd probably be more understanding in that scenario.
Bruh. If your property is in a area i am looking at and meet my budget i would snap it up and try and get the deal done ASAP lol.Soo....
We agreed a low ball offer from our buyer with specific conditions.
He move fast (I paid for the searches from the last buyer) - He's been useless
We Exchange prior to the 1 July - This didn't happen
We advised from the outset that if he wanted a survey it was done ASAP, he appears to have contacted the survey company on 29th June
We pushed our reservation the new build as he said he would go with whatever they told him verbally on Monday - He now says he's waiting for the report on Friday.
Agreement that he waits for our new property with w/build window SEP-NOV - He's now said he wants in BY Sep
What an utter ****
Like most things, the price is whatever people are willing to pay for it.The thing is, how can you expect it to be 330k to be sold when banks down-valued it?
Eh? How do you know how much equity a buyer will have? Simple maths:Every other buyer will have the exact same issue unless there cash buyers or at a rare chance, are able to make that 30k difference and go into negetive equity.
EA will know what LTV a buyer has. The EA we have dealt with in this area all ask us what our LTV is and even ask for mortgage in principle. The seller gets feeded some of this information so they can either accept someone making a silly kfderWith only LTV of 90 percent,or go with someone lower that's a cash buyer or better LTV etcLike most things, the price is whatever people are willing to pay for it.
Eh? How do you know how much equity a buyer will have? Simple maths:
Buyer A offers 300k as they have a 30k 10% deposit and their income enables them to borrow 270k. 10% equity, 90% LTV. Let's say here the bank values it at 300k. If they offered more they'd have to provide cash to do so, not borrow it.
Buyer B offers 330k, they have a 110k deposit and are able to borrow up to 220k also. Obviously they request a mortgage of 220k. House gets valued down at 300k as above. That's fine, they still borrow their 220k but it's at a different LTV.
Expected LTV at 330k: 67%.
Actual LTV after valuation: 73% so they'd probably have a higher interest rate/less options.
No negative equity in sight anywhere Just that they put 30k of their cash into the house which isn't realised as value yet.
This can happen anywhere e.g. you want a graphics card. RTX 3090, MSRP £1000, no stock available from shops who were selling it at £1100, can get one if you're willing to pay £1500 on eBay. What you have then is a card valued at £1000, that the typical price should be £1100 but due to demand the market price TODAY is £1500. That £400 was your choice to tie up in the card cos you had the cash.
This ^ It's a specific term with a definition that's used to describe your mortgage status.That's not what negative equity means.
Negative equity is when the mortgage on the house is higher than the market value.
That's not what "OP" meansYeah I think OP is possibly conflating negative equity with negative/poor investment return.
Sorry yes. But if you bought a place that's 50k above market rate in a fixed 2 year deal and if **** really hits the fan, you are most likely not going to remortgage in a positive equity if that makes sense?Yeah I think OP is possibly conflating negative equity with negative/poor investment return.
Yeah you are FUBAR. This is how repossessions happen, as your LTV will be higher than what the market is willing to offer. You either pay "another deposit" on the place you live to get back to the minimum 95/90% LTV, or foreclose.Sorry yes. But if you bought a place that's 50k above market rate in a fixed 2 year deal and if **** really hits the fan, you are most likely not going to remortgage in a positive equity if that makes sense?
So you could be in negetive equity at the time you are ready to remortgage
But as I said. You as a buyer would know that someone offering on your property what LTV they have and what silly money they offered.But all the above hits a lot harder if you ARE borrowing a large amount and running a 90/95% LTV. We bought at 61% LTV because we had big deposits and very low borrowing power (only one of us earning) so there's a pretty big margin before we're in the ****. So it depends on your circumstances. While I think deposits (in conjunction with high rent/living costs) are the thing that blocks reasonable earners from getting on the ladder, only owning 5% of your house in a wildly variable market seems risky.
I think our house would need to devalue 86k before we'd be at 5% equity. And it's not a very valuable house (for the south).
Bruh. If your property is in a area i am looking at and meet my budget i would snap it up and try and get the deal done ASAP lol... no buying/selling outside of the mm!
Completed as scheduled on Thursday, received the keys and moved a few bits. Friday, Saturday, Sunday and all day today have been moving days!Money received by solicitor. Building insurance purchased and confirmation of exchange completed!
Completion is on schedule for next week. Fingers crossed.
Completed as scheduled on Thursday, received the keys and moved a few bits. Friday, Saturday, Sunday and all day today have been moving days!
Finally got there and now the fun begins to decorate and spend even more money!
Huge relief to have finally done it, we started looking in January 2020 when we left our rental. After several lock downs, a couple job changes and two houses falling through we are finally here and I dont think I will ever leave again, the stress is too much hah