Viewed A House Today

[HenryWeston]

Because of an inheritance, we own our own home, all but for a £4k mortgage, and I have £60k in the bank.

Stay where you are for the next few years, most people would love to be in your position right now.

[RDW]

Cheers Chaps

My revised letter, coments appreciated

Dear Sir,

Further to our viewing of ***** Cottage on the 24th April 2009 we have had chance to discuss and consider our position. Consequently, we would like to make you an offer to purchase this property.

We think the cottage is lovely and that it would make a wonderful family home for us.

Whilst we are very keen on the property, I am sure that you are aware of the deterioration in the country’s economy since the beginning of this year and that you are particularly aware of the bad news surrounding the long term future of house prices.

We also notice that the property has been marketed since mid 2008 and has been priced at £297,000 since early December 2008. According to your negotiator, Tim, no offers have been received thus far.

Taking all of this into account, we would like to make an offer to purchase this property for £222,500. I would also ask that you include the curtains fitted in the property as well as the appliances stated in the particulars in this price.

We do need to sell our existing house, before proceeding, which is not presently on the market. If our offer is accepted we would prefer Simon & Son to perform as our agents to help ease the sales process and chain.

We would welcome your proposal to act for us and market our property. At our viewing I asked Tim to contact our local office with a view to appraising our property.

I have also obtained an independent valuation of our current home and assuming that this is somewhere near correct then we are prepared to ‘price sensibly’ to facilitate this transaction.

To fund this purchase we have next to no mortgage on our current property, plus an amount of cash that we are willing to commit. Therefore, with our equity and the money we have in hand we would only need to agree a new mortgage for a low loan to value and low multiple of earnings to complete.

If you would like to discuss this offer further I can be contacted at the above address, or on my mobile, ******.

Yours Sincerely

RDW.

Cc The Vendor, ********* Cottage.

[johnny5thumbs]

Cheers Chaps

My revised letter, coments appreciated

Dear Sir,

Further to our viewing of ***** Cottage on the 24th April 2009 we have had chance to discuss and consider our position. Consequently, we would like to make you an offer to purchase this property.

We think the cottage is lovely and that it would make a wonderful family home for us.

Whilst we are very keen on the property, I am sure that you are aware of the deterioration in the country’s economy since the beginning of this year and that you are particularly aware of the bad news surrounding the long term future of house prices.

We also notice that the property has been marketed since mid 2008 and has been priced at £297,000 since early December 2008. According to your negotiator, Tim, no offers have been received thus far.

Taking all of this into account, we would like to make an offer to purchase this property for £222,500. I would also ask that you include the curtains fitted in the property as well as the appliances stated in the particulars in this price.

We do need to sell our existing house, before proceeding, which is not presently on the market. If our offer is accepted we would prefer Simon & Son to perform as our agents to help ease the sales process and chain.

We would welcome your proposal to act for us and market our property. At our viewing I asked Tim to contact our local office with a view to appraising our property.

I have also obtained an independent valuation of our current home and assuming that this is somewhere near correct then we are prepared to ‘price sensibly’ to facilitate this transaction.

To fund this purchase we have next to no mortgage on our current property, plus an amount of cash that we are willing to commit. Therefore, with our equity and the money we have in hand we would only need to agree a new mortgage for a low loan to value and low multiple of earnings to complete.

If you would like to discuss this offer further I can be contacted at the above address, or on my mobile, ******.

Yours Sincerely

RDW.

Cc The Vendor, ********* Cottage.

I don't think you've got a cat in hell's chance of knocking them down from 297 to 222 without being in a total cash position. The EA is going to hold out for a higher offer, or someone completely liquid and ready to rock 'n roll. The same agent thing will help, but not enough to swing it. (imho).

Sorry.

[Bardon]

Cheers Chaps

My revised letter, coments appreciated

Read up on negotiating skills before you do anything.

[Rachman]

What will you do when someone offers £80K for yours ? Will that be different ?

[Downtraded]

Cheers Chaps

My revised letter, coments appreciated

Dear Sir,

It went wrong from the second word....

All an EA wants to hear is "I can complete in 6 weeks".

Anything else and you are just another "wannbe" timewaster.

There is only one language - MONEY.

Current Housing market is this...

1) APRIL - Sell your house first and rent....

2) SEPTEMBER - negotiate 20% cut on houses

[D Vardy's Shadow]

Too long , cut the crap.

Cheers Chaps

My revised letter, coments appreciated

Dear Sir,

Further to our viewing of ***** Cottage on the 24th April 2009 we have had chance to discuss and consider our position. Consequently, we would like to make you an offer to purchase this property, subject to contract and survey.

We think the cottage is lovely and that it would make a wonderful family home for us.

Whilst we are very keen on the property, I am sure that you are aware of the deterioration in the country’s economy since the beginning of this year and that you are particularly aware of the bad news surrounding the long term future of house prices.

We also notice that the property has been marketed since mid 2008 and has been priced at £297,000 since early December 2008. According to your negotiator, Tim, no offers have been received thus far.

Taking all of this into account, we would like to make an offer to purchase this property for £222,500. I would also ask that you to include the curtains fitted in the property as well as the appliances stated in the particulars in this price.

We do need to sell our existing house, before proceeding, which is not presently on the market. If our offer is accepted we would prefer *** & *** to perform as our agents to help ease the sales process and chain.

We would welcome your proposal to act for us and market our property. At our viewing I asked Tim to contact our local office with a view to appraising our property.I have also obtained an independent valuation of our current home and assuming that this is somewhere near correct then we are prepared to ‘price sensibly’ to facilitate this transaction.

To fund this purchase we have next to no mortgage on our current property, plus an amount of cash that we are willing to commit. Therefore, with our equity and the money we have in hand we would only need to agree a new mortgage for a low loan to value and low multiple of earnings to complete. [they'll be on you like vultures to up your offer if you leave your earnings multiple in !!!!]

If you would like to discuss this offer further I can be contacted at the above address, or on my mobile, ******.

Yours Sincerely

RDW.

Cc The Vendor, ********* Cottage.

BTW, not good to put the agents name in your post.

Edited April 26, 2009 by D Vardy's Shadow

[D Vardy's Shadow]

... This is a lifestyle move so I'd rather not put mine on unless we have the house we want to move into lined up, is this reasaonable.

No, it is not reasonable. You are not sufficiently committed to your lifestyle choice! Seriously, you should sell your house and be prepared to rent in order to get what you want - and probably not muddy the waters by making an offer at this stage on a house you are not in a position to complete on.

As and when you get a buyer, you should make your offer based on going into rental: "I offer £x or £x+10,000 if the sale can be done so I do not need to rent."

[RDW]

Too long , cut the crap.

BTW, not good to put the agents name in your post.

It was a made up name, Simple Simon and Tim Nice but Dim

[quibble]

Best advice I have seen around here.

Are you sure you live on the other side of the planet, and not on a different one?

To fund this purchase we have next to no mortgage on our current property, plus an amount of cash that we are willing to commit.

I wouldn't make it obvious that you can afford much more than you are offering. Would just say you are mortgage free and can be certain of getting a 225k mortgage.

[Bardon]

Are you sure you live on the other side of the planet, and not on a different one?

Nope I genuinely beleive that that was a very good and financialy sound option that was posted.

[Mal Volio]

There is absolutely no point putting an offer in if you haven't sold your own house. A seller would be mad to accept it, even if it's good

We got a full asking price offer from the first people through the door on our house, last year. 12 months on they still haven't sold theirs, and we got nearly as good an offer from someone who had sold so we bit their arms off and sold within 3 weeks

Just don't waste your and their time. Don't offer until you are in a position to proceed.

[quibble]

Nope I genuinely beleive that that was a very good and financialy sound option that was posted.

The OP is already increasing his exposure to the housing market by approx 100%. It would be daft to increase his exposure by approx 200% when it is widely accepted that this is the worst recession since ww2. There's a good paper by someone from the federal reserve knocking about here, examining the average length of house price crashes in the developed world; average 5 years. There is no particular reason to believe it wlll be much different this time.

[Bardon]

The OP is already increasing his exposure to the housing market by approx 100%. It would be daft to increase his exposure by approx 200% when it is widely accepted that this is the worst recession since ww2. There's a good paper by someone from the federal reserve knocking about here, examining the average length of house price crashes in the developed world; average 5 years. There is no particular reason to believe it wlll be much different this time.

I still sat it was good advice and thats whatI would do if I was the guy, 5 years is a short time.

Edited April 26, 2009 by Bardon

[Mal Volio]

5 years is a short time.

That just gets you to the turning point. Then it's 5 more years for prices to recover.

[quibble]

I still sat it was good advice and thats whatI would do if I was the guy, 5 years is a short time.

You are wrong. It is bad advice.

If the OP has a yearning to invest in BTL, it makes more sense to leverage up when prices are lower & less likely to fall substantially. Less leverage, more profit, less stress.

Now is not the time to go from a small mortgage on 1 home to a large mortgage on 2 homes. Not the time to go from no debt to 200% leverage, rather than a 'mere' 100%.

The bulls on here go on about inflation bailing out the feckless. This is to ignore the current trend, as evidenced by the difference between CPI & RPI; which is an increase in the price of low order goods and a decrease in the price of leveraged assets. When looking at trends, the most likely thing is for the current one to continue. It is entirely possible that 'inflation' (CPI) will result in higher interest rates, hastening & deepening the current house price crash.

Over the next couple of years, 'inflation' - if it occurs - may well be (very) bad for house prices.

[Bardon]

You are wrong. It is bad advice.

Each to their own

[Bardon]

That just gets you to the turning point. Then it's 5 more years for prices to recover.

Cost of selling and reduced price he got selling in a slump.

[Mal Volio]

Cost of selling and reduced price he got selling in a slump.

Doesn't change the timescale.

You are suggesting that unnecessarily increasing exposure to a falling asset, less than 2 years into a 10 year fall/recovery cycle, is a good thing. If the OP wants to buy a house now cos it is what he wants and he likes the price, that's one thing. Suggesting that he fund it via unnecessary further exposure to risk is madness.

[Sybil13]

if I had a house to sell and someone who also had a house to sell offered me 25% below asking, I'd say "come back when you've sold your house matey!".

tim

More like 39% isn't it? £365000 at peak to £222000 now?

My question is, is the buyer going to reduce his property 39% too? Or accept offer at 39% below peak ?

Of course it is all madness.

Property should now be trading at 30% below peak (2007), the Director of Rightmove stated this in January and a LOT has happened since then. 30% that is :

£300000 2007 now £210000.

That will still mean buyers are going to lose 20% + in the next year, that is £60000 and that is a BIG loss, but it honestly can't be any other way.

Mortgage lending 2007 - £363bn

Mortgage lending 2008 - £258bn

Forecast lending 2009 (CML) - £145bn and how much of that is government money?

The War of the Bulls and bears left us with more debt than WW2 yet Hamish says the people on this website are "selfish morons" :

personal debts of £1.5 trillion; national debt rising to £1.4tn; unfunded public-sector pension liabilities of another £1tn; and all this on top of a £1.3tn bank rescue programme. Britain is in deeper debt now than after the second world war and our children will be paying it off for most of their working lives

There are doubts about whether the government will be able to raise even the £220 billion it needs this year to keep its head above water. Public borrowing is running at 12% of GDP: the highest in the G20 nations. Not even Ireland is in such a bad way.David Cameron was right to warn about the debt crisis last year, when everyone else was talking about fiscal stimulus and the need to boost spending. You can't stimulate a corpse.

Meanwhile Rinoa asks us to REJOICE that irresponsible mortgage lending at the Rock rose 70%!

But to get back to the £300000 property now £210000, if you were thinking of trading up from £250000 say to £300000, it would have cost you £50000, but if you take a 30% drop on your property at £250000 that gives you £175000, and 30% off the £300000, the trade up will only cost you £35000.

I guess this is what the Director of Rightmove meant last week when he said that :" deals were being done at the new level."

So even if anyone feels they have £60000 to lose in a year even with 30% off a £300000 home, one can hardly say" now is a good time to buy" can one?

EA's / and sellers still don't seem to get it though do they, that they are not in a bargaining position. I posted on a thread yesterday that a friend was phoned about a £250000 new Barratt home that the sale has just fallen through on and asked her position. It ended with the agents offering it for £195000. Friend not really interested, and certainly not at the price but agent said "the asking prices are going up 1% in May." 1% of what, when they were offering them at £195000?

Edited April 26, 2009 by Sybil13

[grumpy-old-man-returns]

basket

one

eggs

all

in

Rearrange above words to form a phrase which could equate to financial suicide.

You are in an envialble financial position. (RDW that is)

endofcrash2, you are a financial f*ckwit.

RDW

nice plan

safer option

gamble would be to sell, rent & shop around in the hope of upgrading and being mortgage free.

endofmyknob, why do we need to purchase/rent from bank more than one house???????

good post.

[RDW]

My question is, is the buyer going to reduce his property 39% too? Or accept offer at 39% below peak ?

Not quite, but nearly,

The more expensive houses will fall further as a % though as the rungs get closer together.

[D Vardy's Shadow]

The more expensive houses will fall further as a % though as the rungs get closer together.

??? If they fall by the same %, the rungs will get closer together anyway, certainly in £££

[endofcrash2]

I still sat it was good advice and thats whatI would do if I was the guy, 5 years is a short time.

Cheers. Although I would give it 10 Years.

What the bears on here don't realise is that we will have inflaltion possibly not this year but most likley starting next. Any one with any savings will watch them go POP over a few years and the STR's on here will be crying.

Yes House's might still drop in REAL terms over a five year period because of inflation (NOMINAL falls have all but stopped and will after this months Halifax and Nationwide figures are publised) , however it will be better to invest in property than have cash.

I remember talking to an old German lady many years ago. She had lived through the Hyper inflation in Germany during the 20's-30's. She said the only people that where saved where the one's that had property. If you sold your property you stood no chance.

Edited April 26, 2009 by endofcrash2

[tim123]

I remember talking to an old German lady many years ago. She had lived through the Hyper inflation in Germany during the 20's-30's. She said the only people that where saved where the one's that had property. If you sold your property you stood no chance.

ISTM that's a statment of the bleeding obvious.

But we aren't going to move into Hyper inflation

tim