Help! - flat selling advice

Oh board of all knowledge. Sorry to clog the board with this thread. Just desperate to get some advice from some wiser more experienced heads.

I'm currently in the process of selling my tiny one bed flat in London. I accepted a bid a margin less than neighbours had sold a year ago as the market is clearly cooling. The buyer has submitted a PDF of a survey report saying the valuation is right in accordance with the bid. But the survey report is saying the value of the property is going to drop a steep amount in the next 90 days. Do the banks dictate the market? Or is it demand driven?

I feel like I'm being scammed or low-balled by an experienced buyer who knows brinkmanship. Should I hold out? Or accept the offer a fair whack under what the value is now?

Thanks for anyone who has time to give their 5p! :thumbup:

Demand and supply surely?

The buyer's bank are bound to want to protect their investment by pointing out that the value of your property might drop, potentially reducing the buyer's equity, i think that is responsible behaviour.

That said, it's the buyer's risk. My view is that he's made an offer and you've accepted it, so now he's trying to reduce the price again.

I'd tell him to pay up or do one.

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Originally Posted by TH63

Demand and supply surely?

The buyer's bank are bound to want to protect their investment by pointing out that the value of your property might drop, potentially reducing the buyer's equity, i think that is responsible behaviour.

That said, it's the buyer's risk. My view is that he's made an offer and you've accepted it, so now he's trying to reduce the price again.

I'd tell him to pay up or do one.

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I was hoping you would reply to this TH. Good advice. I've seen your savvyness on this kind of thread before. Really appreciate you taking the time. :thumbup::thumbup:

So the housing bubble is about to burst. Thanks for the info :thumbup:

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Originally Posted by Wales-Bales

So the housing bubble is about to burst. Thanks for the info :thumbup:

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Not necessarily bud. This buyer could be gaming me. The report given still shows a very healthy yield in regard to rental income and it's a buy to let mortgage so the projected drop doesn't really make sense. There could be a wobble in lending because talk of a hung parliement? Or maybe this buyer's borrowing power is poor.

The buyer's stance is ridiculous. He is buying the flat now not in 90 days time. And whose to say the market will drop? It might and it might not. I would stick to your guns.

Furthermore when the man decides to rent it out he will want to accept present day rents and not some fictional rent in the belief rents will either rise or fall in 90 days time. If he is so concerned about rent in the future I suggest he buys a flat in 90 days time and not now.

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Originally Posted by Blue in the Face

Not necessarily bud. This buyer could be gaming me. The report given still shows a very healthy yield in regard to rental income and it's a buy to let mortgage so the projected drop doesn't really make sense. There could be a wobble in lending because talk of a hung parliement? Or maybe this buyer's borrowing power is poor.

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Ah ok, I was going on the bit where the survey report is saying the value of the property is going to drop a steep amount in the next 90 days, and I assumed it was an independent view of the market.

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Originally Posted by TH63

Demand and supply surely?

The buyer's bank are bound to want to protect their investment by pointing out that the value of your property might drop, potentially reducing the buyer's equity, i think that is responsible behaviour.

That said, it's the buyer's risk. My view is that he's made an offer and you've accepted it, so now he's trying to reduce the price again.

I'd tell him to pay up or do one.

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A flat no then :coat:

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Originally Posted by ninianclark

I wouldnt take on board what the buyer says. They either pay you what you want - or they F off. Dont get conned into some sort of BS story.

And by the way - even if it was true - I dont think you would sell your house before June 8th ?

As long as you dont make a loss on it - sit tight, you can always rent it out. If Jezza gets elected PRIME MINISTER and all hell breaks out in the markets - lending may go down - which means rentals will go up. (another reason why tax and spend doesnt work)

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How did you shoehorn Jezza into this thread? :hehe: You've now turned it into a political post, and Matt will be along shortly to move it into the correct forum.

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Originally Posted by Wales-Bales

Ah ok, I was going on the bit where the survey report is saying the value of the property is going to drop a steep amount in the next 90 days, and I assumed it was an independent view of the market.

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One should never make assumptions!

It was hardly an independent report - it was a report prepared on behalf of the potential purchasers funders. No independent surveyor could possibly predict what may happen 3 months from now.

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Originally Posted by Nick

One should never make assumptions!

It was hardly an independent report - it was a report prepared on behalf of the potential purchasers funders. No independent surveyor could possibly predict what may happen 3 months from now.

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It's weird why they would mention it then, if it means they will lose the morguage opportunity. Unless of course the funders are not a bank.

Thanks for all the advice comrades and caviliers! Super helpful.

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Originally Posted by Wales-Bales

It's weird why they would mention it then, if it means they will lose the morguage opportunity. Unless of course the funders are not a bank.

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It is weird mate I do agree. The report literally suggests that the bank estimates a 10k drop in 90 days. It could simply be the bank protecting itself in an unpredictable climate and projecting a worst case scenario.

I'm just wandering if the buyer has knocked up some dodgy dossier though in an attempt to low ball.

There is confusion here, all the bank is saying is that they are only going to lend your buyer an amount that would be the value if the property had to be sold withing 90 days, a forced sell, if your buyer defaults.That is your buyers problem not yours, the money you have agreed on is what you should accept, if the buyer cannot get the money then your deal is dead in the water, move on to the next buyer, should be no problem selling in London. :thumbup:

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Originally Posted by Igovernor

There is confusion here, all the bank is saying is that they are only going to lend your buyer an amount that would be the value if the property had to be sold withing 90 days, a forced sell, if your buyer defaults.That is your buyers problem not yours, the money you have agreed on is what you should accept, if the buyer cannot get the money then your deal is dead in the water, move on to the next buyer, should be no problem selling in London. :thumbup:

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Great advice Guv'nor. Big thanks for taking the time. And to everyone else...

:thumbup:

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Originally Posted by Blue in the Face

I was hoping you would reply to this TH. Good advice. I've seen your savvyness on this kind of thread before. Really appreciate you taking the time. :thumbup::thumbup:

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Cheers for that mate, I know I spend most of my time on this board cocking about, but it means a lot to know my rare sensible posts are appreciated :thumbup:

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Originally Posted by ninianclark

Simple - if the buyer's valuation report says there will be a massive reduction in price over the next 90 days - what else do you think would cause that - other than a change of Govt. Unless of course the potential buyer is about to crash the housing market himself.

A Govt coming in with massive a borrowing / taxing agenda - will affect the market - in my opinion.

So you see - it's not a political post at all. Just a possible answer has to why the housing property will be massively devalued over the next 90 days.

What else do you think would cause this ? - end of the world perhaps, Tsunami, maybe an out break of Ebola in the UK , the world is waiting and this forum is your stage - so crack on son - let us know ?

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What you having for dinner? I'm having a Tories Kill The Sick & Disabled burger :thumbup:

I'm guessing as it's a flat it does not come with a garden or a fence?

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Originally Posted by Mrs Steve R

I'm guessing as it's a flat it does not come with a garden or a fence?

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Yep, no Jezza gnomes in the garden :biggrin:

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Originally Posted by Wales-Bales

Yep, no Jezza gnomes in the garden :biggrin:

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:hehe:

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Originally Posted by Blue in the Face

Thanks for all the advice comrades and caviliers! Super helpful.



It is weird mate I do agree. The report literally suggests that the bank estimates a 10k drop in 90 days. It could simply be the bank protecting itself in an unpredictable climate and projecting a worst case scenario.

I'm just wandering if the buyer has knocked up some dodgy dossier though in an attempt to low ball.

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Sounds like bank just trying to cover itself on an assumption, no one knows what's going to happen do they?? If the bloke wants it enough then 10k won't stop it. We had a similar scenario last summer with brexit, I was selling a house at the time. It all went through no problem. This happens every election doesn't it?? Particularly when they fear labour might win.....

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Originally Posted by goats

Sounds like bank just trying to cover itself on an assumption, no one knows what's going to happen do they?? If the bloke wants it enough then 10k won't stop it. We had a similar scenario last summer with brexit, I was selling a house at the time. It all went through no problem. This happens every election doesn't it?? Particularly when they fear labour might win.....

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Yes. the political uncertainty can't be helping.

The only thing with the buyer is I think he's professional landord. Assuming his loan to value is say 75%, the an extra 7.5k from his risen cash stake might be enough to turn him off.

I've turned the low ball down anyway.

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Originally Posted by ninianclark

Have a read of this - it may explain where the house price crash story is coming from https://fullfact.org/economy/labours...l-your-garden/

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I don't have a garden with the flat. But this tax may could very well have an affect on the average prices and therefore could be impacting me anyway. It certainly would add to the uncertainty for sure.

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Originally Posted by Mrs Steve R

I'm guessing as it's a flat it does not come with a garden or a fence?

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No "GARDEN TAX" then.

Talking of "GARDENS", how is yours these days, Mrs R. :hehe:

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Originally Posted by ninianclark

I think maybe we have found the source of the property prices going down that the buyer in the OP was on about.

The infamous Garden Tax in the Labour manifesto pledge homeowners would pay an annual tax based on the value of their land. It seems the Land Value Tax will be a new tax - as per though, they haven't said how much it will raise, how much it will cost to implement etc.

This means that houses in London and South East would be hit hard compared to houses in other parts of the UK - which will affect the house price. Ok if you are buying - not so good if you are selling , or if you staying put and having to pay a new tax.

It's a manifesto pledge but not yet a fully fleshed out project

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Labour isn't committing to an extra tax on people's gardens. Its manifesto only promised:

"We will initiate a review into reforming council tax and business rates and consider new options such as a land value tax."

A Land Value Tax is a tax on the potential value of land itself, ignoring anything that's built on it. It isn’t being proposed as an additional tax, but as a potential replacement for council taxes and/or business rates.

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Originally Posted by BLUETIT

No "GARDEN TAX" then.

Talking of "GARDENS", how is yours these days, Mrs R. :hehe:

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I've got a concrete yard. :hehe:

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Labour isn't committing to an extra tax on people's gardens. Its manifesto only promised:

"We will initiate a review into reforming council tax and business rates and consider new options such as a land value tax."

A Land Value Tax is a tax on the potential value of land itself, ignoring anything that's built on it. It isn’t being proposed as an additional tax, but as a potential replacement for council taxes and/or business rates.

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The idea will probably be on the table at some point, whichever party comes to power

The business rate and council tax system have been widely criticised for being unfair and inefficient, and Land Value Tax is an idea that’s been around for over 150 years.

The idea has also been promoted by economists across the political spectrum, including the free-market Adam Smith Institute, the left-leaning Centre for Labour and Social Studies, the non-aligned Institute for Fiscal Studies and the Economist, a liberal magazine.

International organisations like the IMF and the OECD are also fans, as was the economist Milton Friedman, whose ideas underpinned Margaret Thatcher’s economic policies.

The Conservatives have also promised a review into the business rates system. So it seems likely that the idea will be considered in a review at some point, whichever party comes to power.

The idea is also put up for consideration in the Liberal Democrat manifesto and the Green party suggests a trial of the tax.

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Originally Posted by BLUETIT

No "GARDEN TAX" then.

Talking of "GARDENS", how is yours these days, Mrs R. :hehe:

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Originally Posted by Mrs Steve R

I've got a concrete yard. :hehe:

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That's hard, try a bit of "AXLE GREASE", it worked for Dynah :hehe:

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Originally Posted by Blue in the Face

Oh board of all knowledge. Sorry to clog the board with this thread. Just desperate to get some advice from some wiser more experienced heads.

I'm currently in the process of selling my tiny one bed flat in London. I accepted a bid a margin less than neighbours had sold a year ago as the market is clearly cooling. The buyer has submitted a PDF of a survey report saying the valuation is right in accordance with the bid. But the survey report is saying the value of the property is going to drop a steep amount in the next 90 days. Do the banks dictate the market? Or is it demand driven?

I feel like I'm being scammed or low-balled by an experienced buyer who knows brinkmanship. Should I hold out? Or accept the offer a fair whack under what the value is now?

Thanks for anyone who has time to give their 5p! :thumbup:

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I think you are right to be suspicious. Firstly, why would a buyer - or anyone financing that buyer - be making an investment which they are claiming to fall 'drop a steep amount' in the next 90 days ? That just doesn't add up. Secondly, are they saying that your property is going to fall in value, or those in the same area, or those in London, or the whole of the UK ? As someone who knows a bit about property, I can assure you that nobody anywhere is making such predictions.

Best way to handle the situation is just to chill and be patient. Providing the offer you accepted was only 'marginally smaller that your neighbours, then you are in control. If he tries to drop the price a later stage just say 'no thanks' - he'll either proceed because he's already paid expenses out, or he will back out. Don't panic, the flat will still be worth the same. Just one small thin you should to. Go onto Rightmove/Zoopla etc and check out 'sold prices of others in your block [if you haven't done so]. You may find your selling to low, not too high...

The value MAY go down in the short term.

But it will vastly increase in the long term

I bought my London flat in 1979 for £14,000:yikes::yikes:, sold 5 years later for £23,000. :yikes:

Value now? circa quarter million.


Tell him to pay up or do one.

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Originally Posted by ninianclark

Simple - if the buyer's valuation report says there will be a massive reduction in price over the next 90 days - what else do you think would cause that - other than a change of Govt. Unless of course the potential buyer is about to crash the housing market himself.

A Govt coming in with massive a borrowing / taxing agenda - will affect the market - in my opinion.

So you see - it's not a political post at all. Just a possible answer has to why the housing property will be massively devalued over the next 90 days.

What else do you think would cause this ? - end of the world perhaps, Tsunami, maybe an out break of Ebola in the UK , the world is waiting and this forum is your stage - so crack on son - let us know ?

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Sorry but it has nothing to do with election/gov/housing market, it is standard practice of banks to only lend what they would expect to get back with a 90 day enforced sale, so if the buyer fails to pay defaults,then the bank would expect to get all of their money back :thumbup:

My best guess would be that it has been misread, how do you think anyone would know what the housing market is going to go down or up,certainly by that amount, the operative word here is the 90 days one, its what banks do, believe me I have been there and done that, the buyer does not have enough deposit/money or the ratio to lending is very high, banks do this all the time, look up banks 90 forced sale lending :thumbup:

Blue in the face,you're gonna be red in the face pretty soon if you listen to this crap.If the banks were that good at telling market trends there would have never have been a financial crisis.Plus the fact that something like this would be huge news.He's trying it on.

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Originally Posted by Wales-Bales

How did you shoehorn Jezza into this thread? :hehe: You've now turned it into a political post, and Matt will be along shortly to move it into the correct forum.

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Tragic, isn't it?

just tell them to **** off or else you will come for their family? always workd for me

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Originally Posted by ninianclark

Why did the report say this then "But the survey report is saying the value of the property is going to drop a steep amount in the next 90 days"

Not 'could' but 'is' - unless the OP has mis read it

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The wording is simply "Projected Market Value (90 days)"

We've heard loads of guff about the banks being more stringent since 2008. But it seems odd. It could be that the buyer's lending power isn't that good and this is a bracket which gives the bank the excuse to be more conservative.

I do think politics is having an impact like you say.

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Originally Posted by A Quiet Monkfish

I think you are right to be suspicious. Firstly, why would a buyer - or anyone financing that buyer - be making an investment which they are claiming to fall 'drop a steep amount' in the next 90 days ? That just doesn't add up. Secondly, are they saying that your property is going to fall in value, or those in the same area, or those in London, or the whole of the UK ? As someone who knows a bit about property, I can assure you that nobody anywhere is making such predictions.

Best way to handle the situation is just to chill and be patient. Providing the offer you accepted was only 'marginally smaller that your neighbours, then you are in control. If he tries to drop the price a later stage just say 'no thanks' - he'll either proceed because he's already paid expenses out, or he will back out. Don't panic, the flat will still be worth the same. Just one small thin you should to. Go onto Rightmove/Zoopla etc and check out 'sold prices of others in your block [if you haven't done so]. You may find your selling to low, not too high...

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Thanks Monkfish. Everything you've said is spot on.

It's great I could come to CCMB and get some rationale thinking because it's hard to do so when the stakes feel high.

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Originally Posted by sneggyblubird

Blue in the face,you're gonna be red in the face pretty soon if you listen to this crap.If the banks were that good at telling market trends there would have never have been a financial crisis.Plus the fact that something like this would be huge news.He's trying it on.

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:hehe: Thanks Sneggy. I held tight and said no.

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Originally Posted by bobh

Tell him to pay up or do one.

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Definitely. I actually used the words "do one" in the email to the agent :thumbup:

THANKS FOR ALL THE HELP FOLKS!!!
XXX

Just for fun how about the idea that property prices in London are about to crash because May
has clearly failed to provide enough police to protect all the homes there from crazy terrorists ?

Finance and property depend on " confidence " and more and more people have no confidence
in our Weak and Wobbly PM.

I've had an offer for a flat accepted and it's looking like I will have moved by the time City play again - should I have made my offer on the proviso that there is a Conservative party win on Thursday?