buying a house - basic questions

[JumpJockey]

So, DH was renting before he bought this place and I came from a flatshare, so no idea how these things work... We've seen a place that would be perfect for us for the next 10 years or more, it will be very competitive though (very few 4 bedders in this area and it's where we'd like to stay). What order do you do the following things -

• put in an offer
  
• speak to bank about mortgage
  
• get our house on market (will sell very quickly if we price realistically, this area very in demand)
  

How long is reasonable between making an offer and getting our house sold? We need to do a few cosmetic things that would help it to sell at a better price (eg paint our bedroom at last, has had previous owners' lime/lavender colour scheme for 7 years ) and the garden would look much better in a couple of months when things start growing. Or is it best just to sell asap if you've had an offer accepted elsewhere?

Is it sensible to use the same EA as the vendor? There's one established agency that specialises in our part of town, and one otherr 'new kid on the block' starting to take on a bit of business, is it easier if it's done through one agency?

Thanks and please don't laugh too hard at our novice-ness!

[lalalonglegs]

Unless you have enough savings not to need to sell your flat, or you have enough equity in it to rent it out and get a buy-to-let mortgage on it, you need to put your house on the market for the estate agents and vendors to take your offer seriously (the price you can reasonably get for your home may also influence the level of your offer). Some agents may not be willing to take your offer seriously until you have an offer on your home - sorry, if I am sounding pessimistic but it is the case. Yes, an estate agent who is selling your house and the one you are after will usually promote your offer quite hard to the vendors as it is double commission and gives him some control of the chain.

Next speak to an independent mortgage broker to see how much you could reasonably borrow.

Then put in an offer.

How long you wait to put in an offer depends on you but, if there is a lot of competition for the sort of house you want, you would be advised to do it sooner rather than later.

[JumpJockey]

Thanks for the advice - I'm not exaggerating to say that 4 bed houses in this area usually get offers accepted within a week. It's a part of town where 95% of the houses are 3 bed terraces, or sometimes 2 beds if they've moved the bathroom upstairs (ours is off the kitchen). This one ticks all of our boxes and is in perfect condition, it came through on my property alert email yesterday and there were 6 other people viewing today hence the need to get in there fast if we're interested.

We're in one of the few parts of the country where house prices are still going up and the agent know our house as DH bought it from then 7 years ago, they know the area very well so could give good advice on a sensible price to ask.

[AnnoyingOrange]

agree with lalalonglegs - most people won't take your offer until your house is on the market or even under offer

[sharon2609]

Agree with lala but this can be a chicken and egg type scenario... Def agree that a sold house gives you strong bidding power on the house you want...but your purchase could fall through and then you are left with no where to live.

Def get a provisional mortgage offer from a lender though.

Can you sell your property and move in with family.....this puts you in the position of being a first time buyer.

[JumpJockey]

So we'd need to put on the market in the next few days? Blimey.

[JumpJockey]

sharon - no family nearby to move in with, closest is my dad who's an hour's drive away... also, our mortgage is a pretty good deal at the mo so not sure we'd want to lose it in order to start over as ftb.

[doinmummy]

Do you know the position of the buyers? Have they found somewhere else? How many in the chain?

If you are serious about moving (whether you get this particular house or not)then I would def put your house on the market.

[awubble]

No seller will pay you anything other than lip service until you have a buyer for your property and funds or an offer in principal for next purchase.

My tip would be to get your house on the market at a realistic price but forget any property until such a time as you have an offer on yours.

Good luck tho.

[JumpJockey]

I guess we are serious, but the kind of house we want comes up so infrequently that we might not find anywhere else at a price we can afford - that's why this one is so ideal. Round here usually to get a decent 4 bedder you're looking at about 450k this one is only 100k more than we'd get for ours which is doable. 2 different stories from the EA about buyers, one person said they've not found anywhere, other said they have...

[doinmummy]

Have you thought what you will do if you get a buyer for your house but then fail to have your offer accepted on the one you want to buy?
Just being devils advocate...it's such a minefield....and no wonder it's near the top of most stressful things to do.

[HollyBollyBooBoo]

JumpJockey I hope this doesn't come across as rude, but how did you think you could afford to buy the new 4 bed house if you haven't got the money or got your house on the market, I am genuinely perplexed?

As a seller with 6 other people wanting a viewing I wouldn't even give you a viewing of my property unless you were in a position to put in an offer and proceed as I would see it as a waste of my time.

[Ciske]

I would go in this order:

• Ask 3 estate agents to visit, value your property and quote for their fees. Make no decision yet, this is just to get an idea of your house value so you have a figure to start off with at the bank.
  
  
• Discuss mortgage with bank. Ask for max amount you can loan, deposits, monthly repayments and additional fees. At the end they will give you an Agreement in Principle that states how much you can borrow.
  
  
• Ring around solicitors and ask about fees for selling and buying a property.
  
  
• Sit down with your partner and agree on the minimum amount you can sell your house for and what you can then offer realistically on the next house. Take into account the information you have gathered on deposits, estate agent fees, bank fees, and solicitor fees. Remember there is stamp duty to pay as well and they depend on the price you pay for the property. This should tell you what your monthly payments are likely to be post-move, what savings you need to have in place for deposits and what you need to set aside for the fees.
  
  
• Now make a decison on estate agents and on a sales strategy. You can put your house up for less than the initial value to get a quick sale, but because you've done the sums, you should have a fair idea of how much less is still realistic.
  
  
• Put house on market.
  
  
• Offer on new house. You will have the Agreement in Principle to back up your offer and can say your house is on the market and you are aiming for a quick sell.
  
  
  You can of course offer now without any of this in place. However, I would be surprised if the vendor would accept it and take their property off the market with so many uncertainties. My EA didn't let anyone offer without having their finances sorted out first. If this house is expected to sell quickly and there is a lot of interest, you might have left it all too late and will have to wait for the next chance to come along.

[JumpJockey]

Holly - not rude, that's why I'm asking, because I have no idea what order things happen in! It's because houses of the kind we want are so very very rare, and we are thinking of moving in the next 6 months or so, that we were looking at it. The EA asked where we stood and didn't flinch when I said we weren't on the market yet.

doin - that's one of the reasons why I was asking what order you do things in... I have it in my head that somehow if everyone needs a buyer, and also needs a new house to move to, everyone ought to be moving at exactly the same time! Also, lots of the houses I get on my property alert say "No upwards chain", so there must be people out there who have bought another house without selling their own yet.

Ciske - thanks for the very comprehensive list!

[Fiddledee]

I live in a popular road, house constantly under offer since mid September, on buyer number 3 and only moving out next week. Selling your own house may be much more difficult than you think. I would concentrate on that first and then look.

[goldenpeach]

No upwards chain", so there must be people out there who have bought another house without selling their own yet.

No upwards chain means that the seller is not buying anything, so the sale is not linked to a purchase, it has nothing to do with buyer. If there is competition for this house, your offer won't be at all appealing unless you have extra money to buy this without having to sell your house. Then you get into capital gains territory if you have two houses in your name.

[lalalonglegs]

You don't get into CGT for quite a while - if you keep the original house as your primary residence until you sell it, it's not a problem.

Have you spoken to an estate agency yet Jockey?

[JumpJockey]

We're taking a second look today (DH wasn't able to come to the first viewing) but it does look as if we might not be in a realistic position to make an offer. Thanks MN for crushing my dream [goes off to learn a bit more about the housebuying process]

[mrshotrod]

We've done more work on our house while it's been on the market than ever before (Due to original sale, survey and a whole host of problems.)
Anyway, The way the market is at the moment, at least where we are, you need your house to be at least on the market, and at very best under offer when you put an offer in on a place. We tried it the other way round (cos you want to know there is somewhere worth selling up for first right?) and it was never going to work.
The agents of any house you probably even look at let alone make an offer on, will want to know your position and up hear they do sometimes ask if your mortgage offer is in place, so it's another thing to look into early on.
Things so easily can go wrong when a chain is set up. Even when you think it's sold, you house is still yours until that contract is exchanges and it's all completed.
Welcome to a world of stress!

[JumpJockey]

Well we've got two agents coming tomorrow to give valuations, they both have people actively looking for houses in our area. The one that is main local specialist had this place on the market within a couple of days of the vendor first going in, so we should in principle be able to be on market very soon too - just need to paint bedroom! I spoke to the bank and they've said we'd def be able to get a mortgage. There's already been an offer 5k above the asking price, so I asked about a mortgage 25k higher than that just in case, and it's still within our affordability easily.

So thank you in fact for kicking me into action! We're doing a final viewing on Sat to do last measurements, ask questions about plumbing/insulation etc, and then we'll think about an offer. Crikey!

[Harimad]

"Discuss mortgage with bank."

Please also be reminded that banks aren't the only places to get a mortgage.
Banks have got great direct deals out at the moment, but they don't necessarily have the best deal for you.
A mortgage broker can look at a range of options to see what best suits you, not which of their range you fit in best with.

Just keep an open mind...

[Harimad]

Ok, so I do have a vested interest, but I really mean, just search around for the best deal for you - which may or may not be with a bank.

[girlfromdownsouth]

DH and I have been buying, doing up and selling houses for 15 years and it is very important that you have an offer of funding in place or you will not be taken seriously. By that I mean an Agreement in Principle. I agree with Harimad that brokers can be worth their weight in gold.

Also you need to have your place on the market and ideally have accepted an offer in order to put yourself in the best position. We have sometimes (though not often) sold our house first and rented for a short while to put ourselves in the best possible position. Not suggesting you do that as it's a lot of hassle, just mean that the further down the line you are with selling your place the more seriously your offer on the new place can be taken.

[JumpJockey]

We've had our two valuations, both came out about the same, so we're going to have a serious talk tonight about next step... One agent has a cash buyer looking for BTL (hiss) in this area, so we could very likely sell to him quickly if we went for the lower end of the price range to ensure a quick sale.

Harimad - do you have some spare cash you're wanting to lend to a worthy cause? TBH because we've got an offset account (offset about 40% of current mortgage, would be about 20% of what we need on the next one) we're looking at deals from current bank. We'd officially have to pay early redemtion penalty, but because it's only a couple of months short the mortgage agent said he thinks they'd write that off

even better for us, both agents said no point painting our bedroom, buyers would probably want to redecorate anyway and it would just slow things down. Hurrah!

[mrshotrod]

Just to add to previous post - SELL FIRST!!!! and make sure you are really sold. Save your self a lot of heart break and expense.
Our 2nd buyer, all going smoothly, she's now lost her buyer.............
be warned!
It's a dreadful system in this country.

[Harimad]

Sorry - by 'vested interest', I mean I'm a mortgage broker!

Knowing what banks can be like I can't help recommend that you speak with a broker too, just to compare what's out there rather than just accept what the bank suggests...