WWYD: Being offered over-the-odds for your home
Discussion
We are selling our home to buy a new-build and had two agents visit, valuing our house at "offers over £350,000" and "guide price of £365,000".
The builder offered a part exchange price of £350,000 and we decided that this was reasonable as it avoids agency fees, the chain, and other unknowns which could appear. The house was marketed and no fewer than 15 prospective buyers visited within the first 5 days, all of which put in offers above the asking price of £360,000.
An offer of £375,000 was accepted by the house builder. The sales agent for the house builder then called us to let us know that this is far in excess of any offer they expected and that they believe it fairest if we pay their "penalty fee" of 1.6% + VAT for pulling out of the PX deal and selling the house directly instead. We have our own thoughts on why they've done this (it's not pure altruism!) but that is off-topic.
The buyer found is a first-time buyer with more than a 40% deposit and we decided we are happy with the risk of taking on the chain for the benefit of a further £18k in our pocket and, knowing how popular the house was, were confident that if the chain did break we would have no trouble finding another buyer. So far, so good.
We were passed to the agent selling the house for the builder who then told us of another buyer who is eager to buy our house instead. Before the PX deal was stopped, this buyer offered £380,000 without seeing the house and were told no as a buyer has already been found. They also turned up unannounced at our front door the day after the initial offer was accepted and told us they wanted to offer "£15,000 above asking price" before even being allowed inside. This was before we knew the details of the other sale and we again said no and didn't allow them in on the basis that it was a PX deal and things were proceeding fine already.
Since this they have increased their offer to £395,000 and have told the agent they are a cash buyer very keen to buy/live on our street. For the avoidance of doubt, we do not live on a glamorous street. At all.
At this stage I have told the agent to seek evidence of this cash and to carryout required ID checks to ensure this sale could proceed if we accepted the offer. We have also asked the agent to inform this buyer that any survey of the house will show it to be worth far less than this amount and if we were to proceed with them we would not be open to last-minute negotiation under any circumstances.
My partner and I are torn. We don't want to be greedy for the sake of it, and both agree that our house is most certainly not worth the figure being offered, but with the option of a further £19k in our pocket - Almost £40k in total more than we ever thought we'd see from this - it seems very tempting and we feel it should be given due consideration.
We've both decided not to get excited about this other offer and to treat it very pragmatically, but we have an obvious "emotional" stake in this.
So I ask the internet, What Would You Do? What other questions, checks, concerns would you have? Would you take the gamble or consider yourself happy with your lot?
Provide us with some impartial balance, please!
The builder offered a part exchange price of £350,000 and we decided that this was reasonable as it avoids agency fees, the chain, and other unknowns which could appear. The house was marketed and no fewer than 15 prospective buyers visited within the first 5 days, all of which put in offers above the asking price of £360,000.
An offer of £375,000 was accepted by the house builder. The sales agent for the house builder then called us to let us know that this is far in excess of any offer they expected and that they believe it fairest if we pay their "penalty fee" of 1.6% + VAT for pulling out of the PX deal and selling the house directly instead. We have our own thoughts on why they've done this (it's not pure altruism!) but that is off-topic.
The buyer found is a first-time buyer with more than a 40% deposit and we decided we are happy with the risk of taking on the chain for the benefit of a further £18k in our pocket and, knowing how popular the house was, were confident that if the chain did break we would have no trouble finding another buyer. So far, so good.
We were passed to the agent selling the house for the builder who then told us of another buyer who is eager to buy our house instead. Before the PX deal was stopped, this buyer offered £380,000 without seeing the house and were told no as a buyer has already been found. They also turned up unannounced at our front door the day after the initial offer was accepted and told us they wanted to offer "£15,000 above asking price" before even being allowed inside. This was before we knew the details of the other sale and we again said no and didn't allow them in on the basis that it was a PX deal and things were proceeding fine already.
Since this they have increased their offer to £395,000 and have told the agent they are a cash buyer very keen to buy/live on our street. For the avoidance of doubt, we do not live on a glamorous street. At all.
At this stage I have told the agent to seek evidence of this cash and to carryout required ID checks to ensure this sale could proceed if we accepted the offer. We have also asked the agent to inform this buyer that any survey of the house will show it to be worth far less than this amount and if we were to proceed with them we would not be open to last-minute negotiation under any circumstances.
My partner and I are torn. We don't want to be greedy for the sake of it, and both agree that our house is most certainly not worth the figure being offered, but with the option of a further £19k in our pocket - Almost £40k in total more than we ever thought we'd see from this - it seems very tempting and we feel it should be given due consideration.
We've both decided not to get excited about this other offer and to treat it very pragmatically, but we have an obvious "emotional" stake in this.
So I ask the internet, What Would You Do? What other questions, checks, concerns would you have? Would you take the gamble or consider yourself happy with your lot?
Provide us with some impartial balance, please!
I’d be asking the house builder to increase their PX offer…
Assuming you can land on a figure between their previous PX offer and where the prospective purchasers are, and you don’t pay their penalty fee, then there’s money in it all round but you’ve got the purchase underwritten (and eliminated the risk a buyer pulling out puts you in a position where you can’t proceed with your purchase).
Assuming you can land on a figure between their previous PX offer and where the prospective purchasers are, and you don’t pay their penalty fee, then there’s money in it all round but you’ve got the purchase underwritten (and eliminated the risk a buyer pulling out puts you in a position where you can’t proceed with your purchase).
I would question the integrity of their offer and stick with the FTB.
I know the housing market it crazy at the moment, but are people really making offers at well over the asking price without viewing, and crucially seeing this through?
How do you know they arent making multiple offers on properties they think they might like and then pull out of the ones they dont like when they actually view?
I think you would be at risk of accepting the higher offer, who would then pull out for something else, and lose your FTB who sounds like they really like your house.
I know the housing market it crazy at the moment, but are people really making offers at well over the asking price without viewing, and crucially seeing this through?
How do you know they arent making multiple offers on properties they think they might like and then pull out of the ones they dont like when they actually view?
I think you would be at risk of accepting the higher offer, who would then pull out for something else, and lose your FTB who sounds like they really like your house.
Stop cocking around.
We agreed a part ex from new build to another new build on the same estate. Yes we had to accept a little under market value but we secured the house we wanted and that's what was most important.
The numbers you're talking about are relatively small fry in the grand scale of things and only worth it if you're prepared to lose out on the new house. Any seller will go for the easiest route and if you make it hard they'll go elsewhere.
We agreed a part ex from new build to another new build on the same estate. Yes we had to accept a little under market value but we secured the house we wanted and that's what was most important.
The numbers you're talking about are relatively small fry in the grand scale of things and only worth it if you're prepared to lose out on the new house. Any seller will go for the easiest route and if you make it hard they'll go elsewhere.
Ethically go with teh FTB
But the Cash buyer I would give them 48hours to deposit the full asking price in escrow with a solicitor.
Don't know where youare but in Leeds we hear tales of people doing jsut that, making massive offers overasking without looking because Channel 4 has moved ot he city so you have cash rich Londoners having sold up a London pokey flat able to move into a full size house and give or take a few thusand they don't care, all propoerties seem like a bargain.
Same is happening in Darlington because they've moved a large Govt department to the town.
But the Cash buyer I would give them 48hours to deposit the full asking price in escrow with a solicitor.
Don't know where youare but in Leeds we hear tales of people doing jsut that, making massive offers overasking without looking because Channel 4 has moved ot he city so you have cash rich Londoners having sold up a London pokey flat able to move into a full size house and give or take a few thusand they don't care, all propoerties seem like a bargain.
Same is happening in Darlington because they've moved a large Govt department to the town.
Thanks all for replies so far - It's good to have the balance. Our thoughts align with most of you that the right thing to do is to stick with the initial buyer, but as the money offered kept increasing we felt we had to really consider it.
Mr Overheads said:
Ethically go with teh FTB
But the Cash buyer I would give them 48hours to deposit the full asking price in escrow with a solicitor.
This is a reasonable idea if we decide to go with him, and I suspect we wouldn't need to tell the other buyer about it until the money is deposited either which buys us some thinking time.But the Cash buyer I would give them 48hours to deposit the full asking price in escrow with a solicitor.
LooneyTunes said:
I’d be asking the house builder to increase their PX offer…
We tried this, but no ball. My understanding is that the PX agreement is a cost to the local sales office in the same way as they can offer stamp-duty incentives and such like on the new property, but the overall benefit of the transaction goes to a higher/head office. Because the offer we received was so good, the local office made it sound like they're doing us a favour but in reality they're just off-loading their "cost" for the deal knowing that this benefits their local performance measures and looks as though they sold our plot without giving as much of an incentive.romeogolf said:
We tried this, but no ball. My understanding is that the PX agreement is a cost to the local sales office in the same way as they can offer stamp-duty incentives and such like on the new property, but the overall benefit of the transaction goes to a higher/head office. Because the offer we received was so good, the local office made it sound like they're doing us a favour but in reality they're just off-loading their "cost" for the deal knowing that this benefits their local performance measures and looks as though they sold our plot without giving as much of an incentive.
Well if canceling the deal makes their numbers look better tell them to also cancel the 1.6% +VAT penalty as that's just bunce for the local office. Mr Pointy said:
romeogolf said:
We tried this, but no ball. My understanding is that the PX agreement is a cost to the local sales office in the same way as they can offer stamp-duty incentives and such like on the new property, but the overall benefit of the transaction goes to a higher/head office. Because the offer we received was so good, the local office made it sound like they're doing us a favour but in reality they're just off-loading their "cost" for the deal knowing that this benefits their local performance measures and looks as though they sold our plot without giving as much of an incentive.
Well if canceling the deal makes their numbers look better tell them to also cancel the 1.6% +VAT penalty as that's just bunce for the local office. I'm easy going. Sure, it's working in their favour, but it's also working in ours so no one is really losing out.
If you go with the cash buyer you must get this done quickly. You wont get them to put money into a solicitors account but you must push them for exchange within 28 days and deposit must be made at exchange and tell them that if they back out you will be 100% keeping the deposit and make sure your solicitor knows you are serious so they can be ready!
People with £400k kicking around in cash are actually often (IME) difficult to deal with. Usually spinning the platesThey will see something else come up and pull the plug on yours. Or worse, because they are cash buyers they will kick the can down the road and delay and delay until they think you will cave then will come the low ball offer. You will be stuffed.
This is exactly what happened to us - just without the stuffing.
We "sold" our vacant BTL to another land lord.
It was on for £220 and got an offer of £230. Brill.
Then 6 weeks later very little had happened. We were not in a chain just disposing but I told the EA to keep this from the buyer just so we had some leverage at least.
Then the first excuse. His wife is very ill and he needs to delay for 4-5 weeks. OK.
We delay. Then 5 weeks passes and he cant do anything for 2 weeks as he is going to a wedding overseas.
FFS.
2 weeks later, now you have to buy it or not.
We are buying, some documents from the solicitors start to pass around.
Then comes "his brother now wants to buy it". This might delay things.... just a matter of changing paper work.
In the end 6 months passed.
And then it came. We can exchange and complete next Friday for 200.
FRO!!!
Rang the solicitor told them to stop and told the EA to re-market.
What a joke. Then took another 6 months to get another buyer through to completion.
These people are snakes and you must avoid them at all costs or at least be very, very firm - especially if you are buying new build where you will have legal obligations to the builder.
As such I would be very very wary of an offer of 40k over a 350k asking price!
People with £400k kicking around in cash are actually often (IME) difficult to deal with. Usually spinning the platesThey will see something else come up and pull the plug on yours. Or worse, because they are cash buyers they will kick the can down the road and delay and delay until they think you will cave then will come the low ball offer. You will be stuffed.
This is exactly what happened to us - just without the stuffing.
We "sold" our vacant BTL to another land lord.
It was on for £220 and got an offer of £230. Brill.
Then 6 weeks later very little had happened. We were not in a chain just disposing but I told the EA to keep this from the buyer just so we had some leverage at least.
Then the first excuse. His wife is very ill and he needs to delay for 4-5 weeks. OK.
We delay. Then 5 weeks passes and he cant do anything for 2 weeks as he is going to a wedding overseas.
FFS.
2 weeks later, now you have to buy it or not.
We are buying, some documents from the solicitors start to pass around.
Then comes "his brother now wants to buy it". This might delay things.... just a matter of changing paper work.
In the end 6 months passed.
And then it came. We can exchange and complete next Friday for 200.
FRO!!!
Rang the solicitor told them to stop and told the EA to re-market.
What a joke. Then took another 6 months to get another buyer through to completion.
These people are snakes and you must avoid them at all costs or at least be very, very firm - especially if you are buying new build where you will have legal obligations to the builder.
As such I would be very very wary of an offer of 40k over a 350k asking price!
gotoPzero said:
If you go with the cash buyer you must get this done quickly. You wont get them to put money into a solicitors account but you must push them for exchange within 28 days and deposit must be made at exchange and tell them that if they back out you will be 100% keeping the deposit and make sure your solicitor knows you are serious so they can be ready!
People with £400k kicking around in cash are actually often (IME) difficult to deal with. Usually spinning the platesThey will see something else come up and pull the plug on yours. Or worse, because they are cash buyers they will kick the can down the road and delay and delay until they think you will cave then will come the low ball offer. You will be stuffed.
This is exactly what happened to us - just without the stuffing.
We "sold" our vacant BTL to another land lord.
It was on for £220 and got an offer of £230. Brill.
Then 6 weeks later very little had happened. We were not in a chain just disposing but I told the EA to keep this from the buyer just so we had some leverage at least.
Then the first excuse. His wife is very ill and he needs to delay for 4-5 weeks. OK.
We delay. Then 5 weeks passes and he cant do anything for 2 weeks as he is going to a wedding overseas.
FFS.
2 weeks later, now you have to buy it or not.
We are buying, some documents from the solicitors start to pass around.
Then comes "his brother now wants to buy it". This might delay things.... just a matter of changing paper work.
In the end 6 months passed.
And then it came. We can exchange and complete next Friday for 200.
FRO!!!
Rang the solicitor told them to stop and told the EA to re-market.
What a joke. Then took another 6 months to get another buyer through to completion.
These people are snakes and you must avoid them at all costs or at least be very, very firm - especially if you are buying new build where you will have legal obligations to the builder.
As such I would be very very wary of an offer of 40k over a 350k asking price!
Bunch of sPeople with £400k kicking around in cash are actually often (IME) difficult to deal with. Usually spinning the platesThey will see something else come up and pull the plug on yours. Or worse, because they are cash buyers they will kick the can down the road and delay and delay until they think you will cave then will come the low ball offer. You will be stuffed.
This is exactly what happened to us - just without the stuffing.
We "sold" our vacant BTL to another land lord.
It was on for £220 and got an offer of £230. Brill.
Then 6 weeks later very little had happened. We were not in a chain just disposing but I told the EA to keep this from the buyer just so we had some leverage at least.
Then the first excuse. His wife is very ill and he needs to delay for 4-5 weeks. OK.
We delay. Then 5 weeks passes and he cant do anything for 2 weeks as he is going to a wedding overseas.
FFS.
2 weeks later, now you have to buy it or not.
We are buying, some documents from the solicitors start to pass around.
Then comes "his brother now wants to buy it". This might delay things.... just a matter of changing paper work.
In the end 6 months passed.
And then it came. We can exchange and complete next Friday for 200.
FRO!!!
Rang the solicitor told them to stop and told the EA to re-market.
What a joke. Then took another 6 months to get another buyer through to completion.
These people are snakes and you must avoid them at all costs or at least be very, very firm - especially if you are buying new build where you will have legal obligations to the builder.
As such I would be very very wary of an offer of 40k over a 350k asking price!
ts. If they could only afford £200k or wanted to barter you do so. f
king YOY about and leading you down a long path thinking £20k bruv Innit bang tidy Welshbeef said:
Bunch of sts.
If they could only afford £200k or wanted to barter you do so. fking YOY about and leading you down a long path thinking £20k bruv Innit bang tidy
Yeah its their tactic to get cheap property IMHO.ts. If they could only afford £200k or wanted to barter you do so. f
king YOY about and leading you down a long path thinking £20k bruv Innit bang tidy From what I heard they had 3 or 4 properties on the go at any one time. It only takes one to get a 10-15% discount and they are already making money before they put a tenant in. I heard on the grape vine the same excuses are used day in day out.
gotoPzero said:
If you go with the cash buyer you must get this done quickly. You wont get them to put money into a solicitors account but you must push them for exchange within 28 days and deposit must be made at exchange and tell them that if they back out you will be 100% keeping the deposit and make sure your solicitor knows you are serious so they can be ready!
People with £400k kicking around in cash are actually often (IME) difficult to deal with. Usually spinning the platesThey will see something else come up and pull the plug on yours. Or worse, because they are cash buyers they will kick the can down the road and delay and delay until they think you will cave then will come the low ball offer. You will be stuffed.
This is exactly what happened to us - just without the stuffing.
We "sold" our vacant BTL to another land lord.
It was on for £220 and got an offer of £230. Brill.
Then 6 weeks later very little had happened. We were not in a chain just disposing but I told the EA to keep this from the buyer just so we had some leverage at least.
Then the first excuse. His wife is very ill and he needs to delay for 4-5 weeks. OK.
We delay. Then 5 weeks passes and he cant do anything for 2 weeks as he is going to a wedding overseas.
FFS.
2 weeks later, now you have to buy it or not.
We are buying, some documents from the solicitors start to pass around.
Then comes "his brother now wants to buy it". This might delay things.... just a matter of changing paper work.
In the end 6 months passed.
And then it came. We can exchange and complete next Friday for 200.
FRO!!!
Rang the solicitor told them to stop and told the EA to re-market.
What a joke. Then took another 6 months to get another buyer through to completion.
These people are snakes and you must avoid them at all costs or at least be very, very firm - especially if you are buying new build where you will have legal obligations to the builder.
As such I would be very very wary of an offer of 40k over a 350k asking price!
Daft to brand all cash buyers as “snakes” over one bad experience. People with £400k kicking around in cash are actually often (IME) difficult to deal with. Usually spinning the platesThey will see something else come up and pull the plug on yours. Or worse, because they are cash buyers they will kick the can down the road and delay and delay until they think you will cave then will come the low ball offer. You will be stuffed.
This is exactly what happened to us - just without the stuffing.
We "sold" our vacant BTL to another land lord.
It was on for £220 and got an offer of £230. Brill.
Then 6 weeks later very little had happened. We were not in a chain just disposing but I told the EA to keep this from the buyer just so we had some leverage at least.
Then the first excuse. His wife is very ill and he needs to delay for 4-5 weeks. OK.
We delay. Then 5 weeks passes and he cant do anything for 2 weeks as he is going to a wedding overseas.
FFS.
2 weeks later, now you have to buy it or not.
We are buying, some documents from the solicitors start to pass around.
Then comes "his brother now wants to buy it". This might delay things.... just a matter of changing paper work.
In the end 6 months passed.
And then it came. We can exchange and complete next Friday for 200.
FRO!!!
Rang the solicitor told them to stop and told the EA to re-market.
What a joke. Then took another 6 months to get another buyer through to completion.
These people are snakes and you must avoid them at all costs or at least be very, very firm - especially if you are buying new build where you will have legal obligations to the builder.
As such I would be very very wary of an offer of 40k over a 350k asking price!
CheesecakeRunner said:
My opinion is coloured by my last sale being to someone who sworn they were a cash buyer, managed to prove that to the agent, and then turned out not only to need a mortgage, but had not even put their current property on the market. And when they did, it wound up with a four property chain. Never again. I'll take the smallest chain, ideally with proven cash, over making a bit more money.
This same thing happened to us, cash buyer until the 11th hour, then suddenly needing a mortgage. At least they didn't decide they needed to sell as well. It made us miss the first stamp duty holiday, cost us just over £3k and nearly made the chain fall through. I now in future plan to avoid a chain (or a least a long chain) as best as possible.
LooneyTunes said:
Daft to brand all cash buyers as “snakes” over one bad experience.
We also experience the worse with cash buyers. Maybe we were unlucky but they were incredibly demanding and even after all was given to them they pulled out to them come back 4 weeks later with another offer and promises of not faffing about. We said no. We could afford to keep marketing the property for a good while and on principle would not sell to those regardless of offer. We weren’t desperate. Finding a decent buyer can take time as lots of people are not straight forward.Also asking for a cash buyer to put money in escrow with a solicitor without contracts exchange is never going to happen. And if it did it would give you 0% security.
LooneyTunes said:
Daft to brand all cash buyers as “snakes” over one bad experience.
I didnt say that. I said these people, referring to the people that fecked me over were snakes.However, what I am saying is do your duedil and get your solicitor to keep them in check.
If they have 400 grand in cash money then great - exchange in 28 days.
It will soon show if they are serious or not.
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