Reverse gazumped

the corpo

Odd one this,

Put an offer on a house late last year. We were the highest offer, but at the time too low for the owners. We left the offer with the estate agents, saying to let us know of any further developments.

The house went sale agreed today and have heard from a neighbour that the owners have accepted an offer significantly lower than the one we left them with.

Gutted. Have we been screwed? Have we any comeback??
All I can think is that in the intervening months since our offer, the estate agent simply forgot about us, which is dreadful.

JuliusCaesar

Drop a note in, if you're still interested. Also phone the EA, although he may not want to admit that he forgot about you.

Marcusm

Unless the house is unique or personally special, Yu should s consider yourselves lucky. What you might have been happy to pay last year should be significantly in excess of what ou would pay today. Plus, in all likelihood, given the availability of funding in Ireland, 20-30% higher than it would sell for in 3 years time.

The current Market position provides a great opportunity to those without property to sit on their hands and wait awhile. You might think you know what it's worth but few financial institutions willing to operate in Ireland have the ability to take on further property loans. Accordingly, unless you get a bargain or something which is truly one off (th house next to your sister should that be attractive), nothing is fairly priced.

mikemac

Friends of the estate agent getting inside information and snapping it up?
The EA maybe never told the owner about your higher offer

Sounds like a conspiracy theory but I've not doubt it's happened before and it'll happen again

the corpo wrote: »

the estate agent simply forgot about us, which is dreadful.

But I'd go with the conspiracy theory over this. Forgetting about an offer isn't possible if you have a notebook, a pen and two brain cells! All you do is write offers and names after a phone call

Idbatterim

someone has got their wires crossed, or isnt doing job properly! regardless if I were OP I wouldnt buy regardless. We all know houses are still overpriced, the more patience future buyers show now, the more prices will drop... Its exactly the opposite of the boom, where buyers were climbing over each other to get house and thus forcing up prices... It doesnt make sense for seller to not get max he or she can, Id go direct to seller and make them aware of offer, if you have mortgage approval, and are sure about this... Your not meant to approach seller directly, but when you cant trust or rely on estate agents and this is very common, what are you meant to do?

djmcr

Idbatterim wrote: »

Your not meant to approach seller directly,?

Why not, when buying anything else you do,

the corpo

thanks for the advice. hard to wait though when you've a young family and are eager to get out of an apartment!

Firetrap

Would you not look at renting a house if an apartment doesn't suit?

jamesbrond

I have a friend who is an estate agent. Hes always offering us a deal buying houses. Basically he says that he can make sure higher offers than ours get lost. He'll take a commission from us. Of course we arent interested in buying any house other than our own at the moment, but I know of several people who have taken up his offer and they arent shy about broadcasting it either.

OP, If I were you I would knock on the door and tell the owner about your offer. They wont be happy with the estate agent and if your offer is better will take it directly from you. Have a letter explaining the situation in your hand in case they dont want to talk to you.

mikemac

If you know the owner lives there of course

When my landlord was selling, us tenants were hounded with people knocking on the door and looking for the owner.
They were pointed to the estate agent
If they asked us the price we'd just invent prices to mess with their heads

Good idea on the letter though, write it and bring it with you

The Rooster

feelingstressed wrote: »

But I'd go with the conspiracy theory over this. Forgetting about an offer isn't possible if you have a notebook, a pen and two brain cells! All you do is write offers and names after a phone call

It would hardly surprise people to learn that some estate agents are incompetent!

On four different occassions I've left my name with an estate agent to give me a call if a house in a particular area came up for sale. Not once did I get such a call. Its like a dating game, here's my number but you know and I know you won't call me! You just have to keep your eye out yourself.

Also as a seller, you need to talk to the estate agent immediately after each viewing to get details of exactly what the viewer said or offered, and call the agent back 3 or 4 days later to see if the viewer followed up with anything. Of course some agents are very good, but you can't trust that your one is, you need to be on their back all the time.

the corpo

we've decided that even at the offer that's been accepted we're no longer interested in the house. seeing plenty of nicer ones in better areas pop up for similar money the more we wait.
however, wondering whether we should just forget the whole episode or at least let the owners know they've been shafted, and let the agent know he's been rumbled.

Grumpypants

It does sound fishy and its not uncommon for very nice houses to go to EA or their friends or family.

It would be good to just hear what the family selling the house think of getting less money for it.

the corpo

glad i said nothing.
house has come back on market today, for even less money! now, i'm all a tizzy...

Idbatterim

how much is it on market for now? Do you have mortgage approval?

lainey316

the corpo wrote: »

glad i said nothing.
house has come back on market today, for even less money! now, i'm all a tizzy...

Forget your tizzy, remember the following

the corpo wrote: »

we've decided that even at the offer that's been accepted we're no longer interested in the house. seeing plenty of nicer ones in better areas pop up for similar money the more we wait.

the corpo

lainey316 wrote: »

Forget your tizzy, remember the following

aye, true, but this could be gotten for substantially less now, with a drastically reduced mortgage for us to consider. more money to spend on ourselves over the next 30 years!

Unrealistic

jamesbrond wrote: »

I have a friend who is an estate agent. Hes always offering us a deal buying houses. Basically he says that he can make sure higher offers than ours get lost. He'll take a commission from us. Of course we arent interested in buying any house other than our own at the moment, but I know of several people who have taken up his offer and they arent shy about broadcasting it either.

OP, If I were you I would knock on the door and tell the owner about your offer. They wont be happy with the estate agent and if your offer is better will take it directly from you. Have a letter explaining the situation in your hand in case they dont want to talk to you.

If the estate agent is so crooked as to take a commission from both buyer and seller I wouldn't rely on him to be acting in your best interest (or your friends' best interests seeing as you were smart enough to steer clear). Chances are there are no higher offers but he is just inventing them to make your friends think they are getting a deal when really everyone is getting screwed.

lainey316

the corpo wrote: »

aye, true, but this could be gotten for substantially less now, with a drastically reduced mortgage for us to consider. more money to spend on ourselves over the next 30 years!

Stall for 3 months and see what you get then. You clearly don't love this house, and to buy now you have to LOVE it. I think. At least see it again, then see something 75k more - one of these better houses in better areas, then think about it.

djmcr

lainey316 wrote: »

Stall for 3 months and see what you get then. You clearly don't love this house, and to buy now you have to LOVE it. I think. At least see it again, then see something 75k more - one of these better houses in better areas, then think about it.

Good advice, houses that are currently outside your budget will be coming into it soon enough

the corpo

damn you all with your common sense....

user1842

Im confused. Surely because of the massive interest rate increases and the prospect of more to come, how are house prices actually cheaper in the long run for people with new mortgages?

If you actually do the maths houses are just as affordable as they were 4 years ago if your buying with a mortgage.

How are people not seeing this?

Theboinkmaster

dmclean1842 wrote: »

Im confused. Surely because of the massive interest rate increases and the prospect of more to come, how are house prices actually cheaper in the long run for people with new mortgages?

If you actually do the maths houses are just as affordable as they were 4 years ago if you buying with a mortgage.

How are people not seeing this?

You're wrong - show us your calculations and I'll show you exactly how

user1842

Theboinkmaster wrote: »

You're wrong - show us your calculations and I'll show you exactly how

Ok in 2006 you could get a tracker mortgage of 3.5%:

Monthly repayment: €1,337.95
Mortgage amount: €300,000
Interest rate (APR): 3.5%
Term: 30 years
Cost of Credit: €181,663.29
Total cost of loan: €481,663.29

Now in 2011 you cant get a tracker and the interest rate is about 6.5% and we will say that house prices decreased by 33%

Monthly repayment: €1,239.78
Mortgage amount: €200,000
Interest rate (APR): 6.5%
Term: 30 years
Cost of Credit: €246,319.24
Total cost of loan: €446,319.24


Not much of a saving plus I believe that the 6.5% rate will go up and up.

Damie

I have to agree with dmclean(well sort of)...

Houses are getting cheaper but the cost of borrowing is becoming more and more expensive.
The tracker mortgage is what's keeping a lot of people above water at the moment, current buyers don't have this facility.
The tracker is probably killing the banks at the moment, no question, but what if nobody was on a tracker and everyone was on variable, in my view re-possession would have kicked in sooner and mortgage default would be common practice, thus driving house prices lower as people try to sell up to get out.

The best practice, as has been said I'm sure, is to borrow as little as possible....so take your time and save as much as possible.

Anyway, this debt-forgiveness will throw the spanner in the works totally if it comes in. Nobody will pay the mortgage and just save their repayments, until the banks "forgive"....its going to get messy!

Unrealistic

dmclean1842 wrote: »

Ok in 2006 you could get a tracker mortgage of 3.5%:

Monthly repayment: €1,337.95
Mortgage amount: €300,000
Interest rate (APR): 3.5%
Term: 30 years
Cost of Credit: €181,663.29
Total cost of loan: €481,663.29

Now in 2011 you cant get a tracker and the interest rate is about 6.5% and we will say that house prices decreased by 33%

Monthly repayment: €1,239.78
Mortgage amount: €200,000
Interest rate (APR): 6.5%
Term: 30 years
Cost of Credit: €246,319.24
Total cost of loan: €446,319.24


Not much of a saving plus I believe that the 6.5% rate will go up and up.

It would probably be better to run at €180k as it is generally accepted that asking prices have dropped by at least 40% and anecdotally estate agents are saying that actual sales prices have dropped at least 50% already.

Certainly if someone has to borrow 90% then the higher interest rates means they are not seeing the full benefit of the drop in house prices. But as prices drop the amount people have in savings will make up a higher percentage of the house purchase price so a lower percentage needs to be borrowed. Hopefully there are not still people out there with the mentatlity that they will take a 90% mortgage just because the bank is offering it when in reality they could plough more of their savings into the purchase and only borrow 70%.

user1842

Unrealistic wrote: »

It would probably be better to run at €180k as it is generally accepted that asking prices have dropped by at least 40% and anecdotally estate agents are saying that actual sales prices have dropped at least 50% already.

Certainly if someone has to borrow 90% then the higher interest rates means they are not seeing the full benefit of the drop in house prices. But as prices drop the amount people have in savings will make up a higher percentage of the house purchase price so a lower percentage needs to be borrowed. Hopefully there are not still people out there with the mentatlity that they will take a 90% mortgage just because the bank is offering it when in reality they could plough more of their savings into the purchase and only borrow 70%.

Good point, I can see interest rates hitting 9 or 10% in the future which will really sting.

O how I wish you could get a tracker mortgage now.

martinn123

Damie wrote: »

The best practice, as has been said I'm sure, is to borrow as little as possible....so take your time and save as much as possible.

Anyway, this debt-forgiveness will throw the spanner in the works totally if it comes in. Nobody will pay the mortgage and just save their repayments, until the banks "forgive"....its going to get messy!

Don't depend on Debt forgiveness, it's not going to happen precisely for the reason above. Heard Richie Boucher on radio today, he avoided this question. All he confirmed is that BofI are dealing with distressed mortgages on an individual case by case.
Any bank that announces Debt forgiveness will be facing mortgage holders who refuse to pay, and total chaos. So get real folks.

Damie

As I said, if there is any "forgiveness" of any kind then.....its going to get messy!

Idbatterim

There is no way fall is only 33%, 40% minimum, also as rates go up, prices will go down...

Idbatterim

Debt forgiveness will open a can of worms! if someone can only afford to pay back half mortgage, park maybe half the debt, do not write it off.