The Property Market?

Posted by: Paul Hutchings on 27 September 2006

Six months ago my Granddad passed away. His house has been on the market for approximately three months during which it's had an average of 2 viewings a week.

Today my mum received the first offer (subject to all the usual stuff) from a "pair of couples" who buy property do it up and sell it on.

The house does need some internal modernisation, and this was reflected in the asking price which was what the estate agent that my mum chose suggested.

Long story short the offer is approx. 7% less than the asking price, but there's no chain etc.

I appreciate it's awkward without mentioning figures, and ultimately it's a personal call, but what would you do and why?

There is no financial imperative to "shift it quickly" but an empty property costs time and money to keep empty and my mum is tempted to accept the offer because taking that money now and investing it could go some way to making up for whatever extra a future offer might be, IYSWIM.

TIA,
Paul
Posted on: 27 September 2006 by Bob McC
Well within the 10% reduction that you could expect on average IMHO.
Also get rid before she's compelled to produce the thermal efficiency report sometime next year.
Posted on: 27 September 2006 by rupert bear
Three months is usually seen as the longest a property should be on the market before some price adjustment, I would have thought. There used to be an adage that if something hadn't sold in 2 months it was overpriced.

The trouble with generalisations about the British property market (as per Daily Mail headlines) is that it's notoriously regional, i.e. the market can be booming in one area and pretty flat in another; or even between one town and a more sought-after adjoining town. So even if you gave us all the full details, we'd probably draw conclusions based on our own experience in our area - irrelevant really. Your best bet is to pose as a buyer in your area and suss out the market from the buyer's perspective. If it's really a buyer's market there (and bear in mind that as we head towards Xmas the market gets quieter), then selling it at only a 7% drop after 3 months looks like a good idea.
Posted on: 27 September 2006 by Rasher
3 months is long enough and I presume that if you hold out for say half that cut (no-one will pay asking price, so you are really holding out for 3.5% in reality), 40% of the difference you are going to give to the government in inheritance tax anyway, so it really boils down to bugger-all.
Take it if it's a genuine offer.
If you are going to stick it out you need to change agents at this point, they might be hanging you out to dry for a bung.
Posted on: 27 September 2006 by Bob McC
Rasher
What are you talking about? the house is being sold by the wife. No IHT or CGT to consider there at all.
Posted on: 27 September 2006 by MichaelC
Bob

Just being pedantic but your original post refers to your grandad and your mum. No mention of grandmother. And by implication there could have been an IHT angle.

Cheers

Mike
Posted on: 27 September 2006 by MichaelC
Goodness me, what made you think that? I have morphed into the wholesale and distribution of underwater bicycles and lighthouses. But I don't seem to have sold any, just yet.
Posted on: 27 September 2006 by Stephen Tate
quote:
Originally posted by Paul Hutchings:
what would you do and why?


quote:
There is no financial imperative to "shift it quickly" but an empty property costs time and money
Paul


Hi,

I would paint everything in Magnolia, chuck in some cheap carpets, lightly furnish the place, get some keymeters installed, put locks on the rooms and fill it with lodgers. With two rules! - Keep the place clean and pay the rent on time.

This will give an income Which will more than pay for itself. As long you are prepared to deal with lodgers, if and when, then everything should work.

P.s. Make sure you have a big trailer if rents go Awry. Don't take any shit.

regards
Posted on: 27 September 2006 by northpole
I know of two people who found themselves in a similar situation - elderly parents passing away in both cases.

Their properties sat with little or no interest. Both people ended up spending some money to redecorate, replace musty old carpets and generally freshen the places up.

I'm not sure on the condition of the property you have to deal with however, the approach outlined above was very successful.

Peter
Posted on: 28 September 2006 by Paul Hutchings
Inheritance Tax isn't an issue, Capital Gains applies I believe.

The interior decor i.e. carpets/curtains/wallpaper is to a good standard just not to a very good taste for most buyers.

Having spoken to my mum this morning I think the basic response it to accept the offer but it stays on the market until completion and it is as low as she will go so any shit to try and drop the price won't work (hopefully the estate agent can convey this a bit more politely).

Thanks all,
Paul
Posted on: 28 September 2006 by Bob McC
If your mother was the wife of the grandad that passed away at the time of his death there are no CGT implications at all.
Posted on: 28 September 2006 by Paul Hutchings
Bob, not sure how they do things in Cheshire but round here if my mum was my grandads wife she'd be my granny not my mum Smile
Posted on: 28 September 2006 by Bob McC
doh!
Posted on: 28 September 2006 by Stephen Tate
hi

I'ver that, or sell it!
Can anybody supply other options,
That is more constructive? Confused

This is a cruel cold world my friend and you need to make things work.
Unfortunatly these are the times.
As long as everybody is happy(this is hard work?) then everything should be fine.

Naim owners take a stand!
Best of luck.
P.S. Could possibly be on one! Big Grin
regards