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zemphis

True Value Of A Property

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We are considering selling a property. It's a 3 bedroom detached house that needs a full refurb. Basically the house is a dump and everything needs doing including:

New bathroom

New kitchen

New rear windows

Replace central heating system

Possibly a rewire and full replumbing

Most ceilings and walls need replastering

Drive needs new tarmac

If we had the money or the experience to do up the place, i probably would. But we cant afford it and there is so much to do that is overwhelming.

In the current market i think it would be a waste of time putting it on the market. The thought of waiting months and months for a possible sale is discouraging. Any potential buyer viewing the property would be put off by the amount of work needed and the cost of it. Plus there is the embarrassment side of it when people come round to view the property. They will probably laugh at the state of the place.

So we have decided to try the cash buyer route. But only had a couple of offers recently which are about 40% below market value. Would this be a fair price to sell at? For example if a similar property on the same road in good order sold for £220k last year, how much would be a fair cash offer for ours now taking into account the condition?

Is there a way to work out the true value of a property? Does anyone have a formula or does it come down to what people are prepared to pay for it?

all thoughts welcome thanks

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We are considering selling a property. It's a 3 bedroom detached house that needs a full refurb. Basically the house is a dump and everything needs doing including:

New bathroom

New kitchen

New rear windows

Replace central heating system

Possibly a rewire and full replumbing

Most ceilings and walls need replastering

Drive needs new tarmac

If we had the money or the experience to do up the place, i probably would. But we cant afford it and there is so much to do that is overwhelming.

In the current market i think it would be a waste of time putting it on the market. The thought of waiting months and months for a possible sale is discouraging. Any potential buyer viewing the property would be put off by the amount of work needed and the cost of it. Plus there is the embarrassment side of it when people come round to view the property. They will probably laugh at the state of the place.

So we have decided to try the cash buyer route. But only had a couple of offers recently which are about 40% below market value. Would this be a fair price to sell at? For example if a similar property on the same road in good order sold for £220k last year, how much would be a fair cash offer for ours now taking into account the condition?

Is there a way to work out the true value of a property? Does anyone have a formula or does it come down to what people are prepared to pay for it?

all thoughts welcome thanks

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We are considering selling a property. It's a 3 bedroom detached house that needs a full refurb. Basically the house is a dump and everything needs doing including:

New bathroom

New kitchen

New rear windows

Replace central heating system

Possibly a rewire and full replumbing

Most ceilings and walls need replastering

Drive needs new tarmac

If we had the money or the experience to do up the place, i probably would. But we cant afford it and there is so much to do that is overwhelming.

In the current market i think it would be a waste of time putting it on the market. The thought of waiting months and months for a possible sale is discouraging. Any potential buyer viewing the property would be put off by the amount of work needed and the cost of it. Plus there is the embarrassment side of it when people come round to view the property. They will probably laugh at the state of the place.

So we have decided to try the cash buyer route. But only had a couple of offers recently which are about 40% below market value. Would this be a fair price to sell at? For example if a similar property on the same road in good order sold for £220k last year, how much would be a fair cash offer for ours now taking into account the condition?

Is there a way to work out the true value of a property? Does anyone have a formula or does it come down to what people are prepared to pay for it?

all thoughts welcome thanks

My first pitstop would be http://www.nethouseprices.com/ to get an idea of what similar properties in the area have achieved. Then price in for all of the work above a good guide for pricing can be found at http://www.whatprice.co.uk/. Once you have worked this price out knock at least another ten per cent off, as no one is going to want to take this on without seeing some potential instant equity.

The above will give you an idea towards a guide price. However, you do need to bear in mind that currently even the most sought after well maintained property is struggling to attract buyers, so you will have to be particularly harsh with your pricing to attract a buyer.

Ultimately it is as you have stated "what people are prepared to pay for it?"

Best of Luck

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Cheer up!

If it's in need of a lot of repair, and is cheap I'd say it's actually got a better chance of selling.

People like to have a project that they feel like they've bought as a real bargain to "do up" on the cheap and then let out, your cash buyer 40% below market value offers probably represent that.

It sounds like it needs a hell of a lot of work, and is a bit of a nightmare... 40% off £220k might sound pretty bad, but consider this -

That 40% off is £88k of "potential" money.

How much will it cost to do up? Probably £55k from the sound of it?

How much will the value fall by while you're doing it up? Takes a year to do up, reasonable to suggest that it'll have lost another 15% of it's value by then? There's your other 33k.

In the current market, I'd take that 40% BMV offer and enjoy the cash in the bank earning interest instead of having some wrecked shell that's leaking money sitting around and depressing me.

Edited by DementedTuna

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We are considering selling a property. It's a 3 bedroom detached house that needs a full refurb. Basically the house is a dump and everything needs doing including:

New bathroom

New kitchen

New rear windows

Replace central heating system

Possibly a rewire and full replumbing

Most ceilings and walls need replastering

Drive needs new tarmac

If we had the money or the experience to do up the place, i probably would. But we cant afford it and there is so much to do that is overwhelming.

In the current market i think it would be a waste of time putting it on the market. The thought of waiting months and months for a possible sale is discouraging. Any potential buyer viewing the property would be put off by the amount of work needed and the cost of it. Plus there is the embarrassment side of it when people come round to view the property. They will probably laugh at the state of the place.

So we have decided to try the cash buyer route. But only had a couple of offers recently which are about 40% below market value. Would this be a fair price to sell at? For example if a similar property on the same road in good order sold for £220k last year, how much would be a fair cash offer for ours now taking into account the condition?

Is there a way to work out the true value of a property? Does anyone have a formula or does it come down to what people are prepared to pay for it?

all thoughts welcome thanks

If the 'good order' one sold for £220K last year, then it would probably fetch a max of £190-200K now. Then you have to deduct the cost of all the work that needs doing (sounds like £50K-ish) which = £140-150K max. Plus there's all the time and hassle involved in renovations, for which another % should probably come off - say 10%.

So if you really want to sell it, you'll be looking at an asking price of £130-140K max, which will probably mean offers of £120K if you're lucky.

But since the cash buyer you say you're looking for is in a strong bargaining position, then realistically (depressingly) it's probably more like £100-110K. If the house is in a good location and has potential for extension you'll be in a better position.

Obviously I don't know your circumstances, but could you not live with it and do it up a bit at a time? Because that's what any potential buyer would probably be doing - I'd guess the hordes of do-it-up-and-flog-it-on buyers have mostly disappeared. Most places can be vastly improved by a cosmetic quick-lick to make them livable for now, and even avocado bathrooms (is it?) don't actually give you plague ;)

Good luck anyway.

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Some good points made by the people above and i agree with you. It seems i may have underestimated the cost of the work required. I was thinking about £25k maybe £30k tops for everything.

And yes we were hoping for a cash offer of about £140k-150k, but the offers we are getting are closer to £110k now :(

I cant believe the price has dropped so low in just 12 months. The feedback we are getting from cash buyers is that the place needs so much work. I think this is what scares people off now. Because buying a property at too high a price in the current market, then having to spend a lot of money on it; not knowing if its worth investing in.

I suppose if the property was in better condition and more 'sellable' then we could probably put it on the market for around £175k and see what happens. But on the other hand we are in two minds about moving because we really like the location and it might be a bad idea moving anyway. So its a mix of feelings really.

By the way whats this business of bears and cows? If anyone can explain cheers

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By the way whats this business of bears and cows? If anyone can explain cheers

Basically - BULLS = House Prices Only Ever Go Up.....

- Bears = Yeah, Right...!

or alternatively - click HERE

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I suppose if the property was in better condition and more 'sellable' then we could probably put it on the market for around £175k and see what happens. But on the other hand we are in two minds about moving because we really like the location and it might be a bad idea moving anyway. So its a mix of feelings really.

So it's somewhere you'd consider living? If so, is there anything that actually makes it uninhabitable at the moment, and if so is it something that can be fixed relatively quickly? If it was a house I liked, in an area I wanted to live, I'd consider moving in and fixing the place up slowly (in fact I've done this before). Naturally it depends on your other circumstances, whether you're paying rent or mortgage elsewhere, whether you're terrified of/useless at DIY, etc.

Bear in mind that people in the building and associated trades might well be hungry for work over the coming few years.

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Yes its a nice area and we would probably stay here if the work was done. But as ive listed above there is so much to be done. The house has not been updated for the past 20 years. Habitable, yes i think so. As long as you dont mind.

Our employment situation is not as good as it used to be. So we cant really afford to get all the work carried out and doing it myself is not an option as i dont have the skills. Even small jobs like changing a bath suite or plastering etc are a nightmare with tradesmen not turning up to give quotes. It seems they only rush round to quote for larger jobs e.g. full kitchen full bathroom. If its a job they estimate at a couple of hundred they dont bother. Im sure its easier if you know family or friends in trades. But if you dont, then all you can do is call up strangers hoping they turn up and quote you fairly and deliver what they promise.

We have been thinking about this move for a while and decided perhaps it would be easier just to move to a property where the work has already been done. But it will mean losing the current location and a smaller property. This is only possible if our own property attracts a buyer first. Otherwise we are stuck here whether we can afford the repairs or not..

It wouldnt be the end of the world if we cant move, but would certainly make life easier.

So it's somewhere you'd consider living? If so, is there anything that actually makes it uninhabitable at the moment, and if so is it something that can be fixed relatively quickly? If it was a house I liked, in an area I wanted to live, I'd consider moving in and fixing the place up slowly (in fact I've done this before). Naturally it depends on your other circumstances, whether you're paying rent or mortgage elsewhere, whether you're terrified of/useless at DIY, etc.

Bear in mind that people in the building and associated trades might well be hungry for work over the coming few years.

Edited by zemphis

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We are considering selling a property. It's a 3 bedroom detached house that needs a full refurb. Basically the house is a dump and everything needs doing including:

New bathroom

New kitchen

New rear windows

Replace central heating system

Possibly a rewire and full replumbing

Most ceilings and walls need replastering

Drive needs new tarmac

If we had the money or the experience to do up the place, i probably would. But we cant afford it and there is so much to do that is overwhelming.

In the current market i think it would be a waste of time putting it on the market. The thought of waiting months and months for a possible sale is discouraging. Any potential buyer viewing the property would be put off by the amount of work needed and the cost of it. Plus there is the embarrassment side of it when people come round to view the property. They will probably laugh at the state of the place.

So we have decided to try the cash buyer route. But only had a couple of offers recently which are about 40% below market value. Would this be a fair price to sell at? For example if a similar property on the same road in good order sold for £220k last year, how much would be a fair cash offer for ours now taking into account the condition?

Is there a way to work out the true value of a property? Does anyone have a formula or does it come down to what people are prepared to pay for it?

all thoughts welcome thanks

Its funny you should ask this, but I think you may be onto something.

Sounds like there could be a market for this sort of service.

You want to sell your estate, and you want it valued.

Maybe you could use somebody else who knows about these things. They could be valuing lots of other estates.

We could maybe call this hypothetical business then, an "estate agency".

worth thinking about.

Edited by Bloo Loo

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We are considering selling a property. It's a 3 bedroom detached house that needs a full refurb. Basically the house is a dump and everything needs doing including:

New bathroom

New kitchen

New rear windows

Replace central heating system

Possibly a rewire and full replumbing

Most ceilings and walls need replastering

Drive needs new tarmac

If we had the money or the experience to do up the place, i probably would. But we cant afford it and there is so much to do that is overwhelming.

In the current market i think it would be a waste of time putting it on the market. The thought of waiting months and months for a possible sale is discouraging. Any potential buyer viewing the property would be put off by the amount of work needed and the cost of it. Plus there is the embarrassment side of it when people come round to view the property. They will probably laugh at the state of the place.

So we have decided to try the cash buyer route. But only had a couple of offers recently which are about 40% below market value. Would this be a fair price to sell at? For example if a similar property on the same road in good order sold for £220k last year, how much would be a fair cash offer for ours now taking into account the condition?

Is there a way to work out the true value of a property? Does anyone have a formula or does it come down to what people are prepared to pay for it?

all thoughts welcome thanks

Are you my husband, you have described our house ;)

My plan is to do what needs doing over the next 5 years, save around £30k too and when we feel the bottom has been reached buy another house and rent out the one we have been doing up with the long term intention of coming back to it and selling the bigger on at the next peak and clearing the mortgage on the current one with the profits. I think it will work for us :blink: but the people I know who have done well out of property basically never over stretch and ensure they can always pay the mortgage on one salary and hold on through the bad times, never let yourself be a forced seller, we will go on bread and water first.

Edited by Girly girl

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Having restored a couple of properties during "the good times", I would

say that now you might well attract FTBs willing to get into the market

who will accept a "project".

50% of the current average "asking" price would be quite fair to both parties,

in my considered opinion.

Good quality properties are changing hands now for between 8% and 15%

off the asking price.

Bearing in mind that even the most conservative estimates reckon a coming

reduction of 25% over 18 months, then 50% for the condition you describe

seems quite reasonable to me.

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Given that most 25 year olds wouldn't know one end of a spanner from the other you are unlikely to attract a first time buyer, they want a nice build with with free mini thrown in, your first idea of a cash buyer, probably a builder is a more likely senrio.

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Yes you're right most FTBs would probably be running away from a property like this. And yes it is basically a ready to start 'builders project' at the moment. In the current market you can tell people are cautious about taking on projects like this. If the prices really come down 50% in the next year or so it would be an even bigger loss than if you didnt need to do any work on a property.

The auction route - this option did occur to me, but there are upfront fees to pay for the advertising etc. Then not knowing how many people will come round on the 'open days'. The embarrassment of it all, crowds of complete strangers gathering outside your door for a nosey round and a giggle. The neighbours coming out investigate whats going on today. I dont know if we could do it. But in theory, possible yes. Just need to set a sensible reserve.

Edited by zemphis

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Personally i'd put it up for auction by the largest auction house they will have a good idea of the REAL value of you property ie what it will actually sell for..... Not some inflated possibly maybe price plus selling at auction is fast and simple as long as it gets a bid that is!

I'd auctionit asap before prices fall furthur even in the "good old days" it could be false economy doing a place up first as by the time youve put far more money into it than you expected wasted 6months of your life and service the mortgage for that period your usually far better of selling as a "bargain" as it will generate much more interest!

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  • 395 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



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