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HI All,

 

Really going through a dilemma now, so would appreciate any advice. I've heard good things about this forum from friends, so decided to give this a go.

 

We're currently in the process of buying a house in Maidenhead. To give some context first, the house is in a great location (close to centre, outstanding catchment etc.) and M'head is on the crossrail route with a town centre regeneration due in the next 3 years or so. So all in all, sounds good you'd think! However, Crossrail appreciation has already been baked into prices across the town so prices are quite steep already!

 

So back to my own conundrum. We've got 8% off the asking price for this house, which I thought was quite high in the first place. However, there's another property within the same estate of houses, now being listed at 4% cheaper, and is highly likely to eventually go for even cheaper. This is reflective of the downturn in the market and the inflated prices in Maidenhead not holding up as much anymore. 

 

We've already gone back and forth on this property a couple of time to get to the 8% discount, and now we're less than 4 weeks from potential completion. We like the house, and do think it works for us (location + size) for the next 5 to 10 years. The intention is to stay here for that long at least. But we're really worried that we're paying more than we should, and if the other house gets sold for a lot cheaper, then we're going to see our house value fall straightaway once we've moved in! We're talking at least 25k-50k range potentially, depending on the price it gets sold at.

 

The only difference between both houses is that ours has a garage and a slightly longer garden, but the other house has a extra en-suite (not room, just the ensuite). Floor space is pretty comparable.

 

Apologies for the long post, but any advice would be hugely appreciated!

 

Many thanks

P

 

 

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From what you say this is a residential property rather than an investment so I am answering on that assumption. Is this a first time purchase or are you selling a property as well?

 

It is difficult to know for what you say what sort of condition the other house is in. Is it possible there is something about the other house that makes it worth less? State of decor for example, in need of a new bathroom or kitchen. The garage will definitely make some difference to the value. I suspect that we are quite close to the top of the market in the South East at the moment (I live near Reading) and it is likely that a fall isn't too far away, but the difficulty is precisely timing this. It might happen next year or in a few years time but in the meantime you still need to live somewhere. You could wait and see what happens to prices but how long can you wait for?

 

The reality is that if you keep looking at other property prices after putting in an offer and the market really is falling you are going to keep having this experience, but you need to live somewhere right? During a downturn all prices are likely to fall so value is going to be lost regardless, including a property you might already own. There is nothing to stop you renegotiating the price up until the end, but you have to be prepared to walk away if you do this. Also consider the costs you have already paid for.

 

if you stay there 5 years you might see a loss to the value of your property, in 10 years you will probably be ok, in 20 years you will almost certainly gain no matter what happens in between.

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Hi James,

 

Many thanks for your response. We don't have anything to sell so currently renting in west london (which isn't cheap either). We do have another house though but that's even further west to Reading which is currently rented out. Since we work in London, the train fares into London from there are prohibitively high for the both of us, hence why we decided to rent it out and move to London. With rents being so high, we want to try and settle down somewhere with good commuter links into London, and thus picked M'head. 

 

The other house is in slightly worse condition, but nothing a couple of coat of paints and some DIY can't fix. It's 9 years old as opposed to the one we're buying now, which is just 5 years old. You do mention a good point about the any work done though - the house we're after had a new kitchen put in 2 years ago. So that's probably worth 10k-15k as they've put in a good quality kitchen.

 

Yes, I suspect we're at the top end of prices too at SE. However, I'm hoping the Crossrail and town centre regeneration catalysts in Maidenhead will prop up prices in Maidenhead, i.e. not lose value at least in the short term. Moreover, this particular house is in the best school catchment in M'head (outstanding school) which I'm hoping will also help hold its value. Crossrail would potentially lead to lot of Londoners wanting to move out of London for some peace and quiet but still wanting to be able to get into central London pretty quickly - hoping M'head will be on the radar. But then again, I'm probably being biased now as we're so far down the line in the purchase process and I'm looking for some re-assurance!

 

I think we'll probably be there for 5-8 years. We initially agreed to buy this house with a 5% discount, progressed 3 weeks into the process, then realised other houses were dropping asking prices in the area, and then managed to re-negotiate a bit more (to just over 8%). I suspect it's probably got a bit more to go down but I really don't feel like messing around the sellers any more either, so not really sure how we could go back and re-negotiate with them now when we're literally 2 weeks away from exchange..

 

Very confused at the moment..

 

 

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Many thanks Richard. Appreciate your response.

 

It's re-assuring that you think M'head is a sound place to live in and likely to hold value medium-long term.

 

The idea is to stay there at least 5-10 years; With all macro factors affecting housing and in particular London and the SE, I'm hoping that's long enough for any correction in property prices to rebound. If not, renting will be the way forward as you suggested.

 

The reason I compared both properties is because they're within the same postcode and same 'block of apartments/houses' - like a small estate. They all have same postcode and gated entrance etc, hence it is only logical (in my humble opinion) that a future buyer would use sold prices in this estate as benchmark. But there are differences as I outlined in my earlier post. 

 

Very true about the seller backing off though if we attempted to drive down price again. I have no intention of messing them about - only reason we did it in the first instance is because the market was just beginning to decline/show signs of stagnation/down turn, and this spooked us more than anything else.  You're also right in saying that should this purchase not happen, then we will remain sceptical and nervous in pursuing any other house as the macro factors all remain and will continue to do so for a few years at least..

 

This is a home for us more than an investment but just because we're putting everything we've saved into this (house is 550k+), we would be pretty depressed should we be 25/50k off right from the outset (or in a few months)....

 

Overall though, we're both keen on the house, the location and feel that it would work for us for around 10 years or so. We currently feel like we should push ahead and then keep everything crossed for the next 10 years!

 

Regards

Pratt

 

 

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Looks like you have made your mind up. I think I'd be pushing ahead in your situation as a home shouldn't all be about investment. It's important that you get somewhere that you WANT to live first and is a good investment second (within reason). I think you should probably stop looking at other property prices now until you are looking to sell and move on again. No point it getting upset at what is happening in the market until it is actually going to affect you.

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1 hour ago, james a said:

Looks like you have made your mind up. I think I'd be pushing ahead in your situation as a home shouldn't all be about investment. It's important that you get somewhere that you WANT to live first and is a good investment second (within reason). I think you should probably stop looking at other property prices now until you are looking to sell and move on again. No point it getting upset at what is happening in the market until it is actually going to affect you.

 Thanks James.

 

I think we're inclined to go ahead, mainly because this is a longer term 'home' for us, and secondly, we're just tired of looking (been 10 months now). We're probably just going to go ahead and then hope all the positives will help hold houses prices in our postcode, especially by the time we decide to sell in 10 years' time or so..

 

Good shout on trying to stop look at house prices. The missus keeps telling me that almost every other day (in fear that I may convince her we need to pull out of this purchase! :D)

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