Bid on property accepted with one large condition

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IggyStooge

Guest
Dear all,

I placed a bid on a property last week that was 15% off asking price and has been on the market over a year. It was accepted on one condition; that the site boundaries be revised, reducing the land size from 0.8 to 0.5 acres.

The reason: this will give the owner a full acre on the north side of the property and the opportunity to have two potential future 0.5 acre sites as opposed to one 0.7 acre site.

I am seeking advice on how I should respond to this unusual request.

Thanks in advance.
 
Depending on the location, would planning permission be granted on the sites?

Would you buy the property today if there were two additional properties nearby?

How would they affect the value of the property you are buying?

How is the cost of the .3 acres comparable to your reduced bid?
 
Presumably you placed your bid on the property "as advertised" with 0.8 acres? So say "No" or reduce your offer by another 15% for the reduced site.
 
The vendor is seeking to reduce the extent of your land by a full 37.5% (0.3/0.8). I would seek a reduction of a similar percentage in the purchase price. Also, you need to consider whether you want two future neighbours on your boundary, or just one. That may also impact your strategy for discussions with the vendor.
 
I would think your lower bid clearly represents the fact that no-one else wanted it at full price.

As no-one else wanted it, even a year ago, at that price, you would expect to get something off the price. 15% seems like it might be reasonable and not untoward in the current climate, presumably that is why you made that bid.

Vendor is not content with that, so he is changing what he has for sale.

One way to look at it is:
he wants you to pay 85% of the original asking price for 62.5% of the land.

He is having a laugh isn't he?

Another way to look at it is:

If he can sell 3 sites at 85% of the original price, he will make 255% (in total) of the original single site price - as opposed to 200% - pretty good going.

The other way of doing it (and presumably his original plan) is to sell the 0.8 and 0.7 sites, each at e.g. 100% of the original price. (this is generously assuming the smaller sites gets as much as the bigger one, and that he can get prices that seem to be above market, given that your site has not sold at that level).

At this rate, for both, he would get 200% of the original price of the 0.8 acre site.

So, his scheme to sell three sites at 85% of the original price of the 0.8 acre site is starting to look pretty generous in his favour, and not in yours.

If you really would be content with a smaller site, and as one of 3 houses in the same area, I would definitely think you should be getting a better deal than this.

[cross posted with prev posting]
 
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Sherman said:
The vendor is seeking to reduce the extent of your land by a full 37.5% (0.3/0.8). I would seek a reduction of a similar percentage in the purchase price.
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This would be fine for a site, but he's looking at purchasing the land AND the house on it. Based on your reduction of 37.5% you're valuing the house at €0.
 
OOps! sorry, I didn't realise that there was a house on the site - I took property to mean the land itself.
 
To be honest, this query does not really have enough detail on it.

But I would agree in general with the first response.

Assuming that having 2 more houses there is realistic, you have to assume they are going to be there at some point, and possibly in a form that you may not like and which may impact on your enjoyment of your home, not to mention its market value.

Can you live with that?

Are you content to have a smaller site yourself?

Do you not think that maybe the property as it stands could possibly be worth 15% less than it was last year anyway? or even less?

You are "seeking advice on how I should respond to this unusual request." - does that mean that you know how you feel but not sure how to tell the vendor? If so, then how DO you feel about it?

Or, as we have assumed, are you looking for views on how you should feel about this condition of sale?
 
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IggyStooge said:
It was accepted on one condition; that the site boundaries be revised, reducing the land size from 0.8 to 0.5 acres.
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Maybe consider as one aspect of this decision, how valuable is the 0.8 acre of land to you, as opposed to 0.5 acre? Would the extra space make all that much difference to you? (I know you also have to consider having two neighbours as opposed to just one as well.)

IggyStooge said:
I placed a bid on a property last week that was 15% off asking price and has been on the market over a year. It was accepted on one condition; that the site boundaries be revised, reducing the land size from 0.8 to 0.5 acres.
I am seeking advice on how I should respond to this unusual request.
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As mentioned by another poster, your 15% reduced offer was on the basis of the propoerty as advertised. If that property is then reduced in size (and you are still interested in it), then I would seriously reduce my offer. What is the value to the vendor of him selling two sites instead of one? This added value could be a useful benchmark by which you can reduce your offer, to the extent that you both still win - i.e. you get a good discount on the asking price, he gets to make more money from selling two sites instead of one.

I would put a reduced offer in writing, outlining your reasons why. I have read elsewhere that there is plenty of research to show that offers in writing are taken more seriously than verbal ones (don't ask me to quote the source!).

I definitely would not let my offer stand as it currently is. You made your opening bid, he made his opening response. There's probably a fair bit of room for maneuvre and, don't forget, the property has been on the market for a year and the market is falling all the time.
 
PM1234 said:
Depending on the location, would planning permission be granted on the sites? Possibly. He has intentioned obtaining planning through his children.

Would you buy the property today if there were two additional properties nearby? Yes, I would.

How would they affect the value of the property you are buying? I dont think that it will negatively effect the value of the property. It is a rural area, with tight restrictions on new buildings.

How is the cost of the .3 acres comparable to your reduced bid? Not sure I understand this question
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ndp said:
I would put a reduced offer in writing, outlining your reasons why. I have read elsewhere that there is plenty of research to show that offers in writing are taken more seriously than verbal ones (don't ask me to quote the source!).
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I would strongly advise against this as there could be serious legal consequences by putting anything in writing. Leave the writing to the legal advisers.
 
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If you feel that your original bid was for the house on the larger site, then just withdraw your offer and make a new offer based on the house on a smaller site. They can accept or reject. Also if you do go ahead watch out for planning rules if there is a septic tank, make sure that the percolation area will be an ok size for selling the property on again. I don't understand the last poster's advice, but don't put anything in writing.
 
" I dont think that it will negatively effect the value of the property. It is a rural area, with tight restrictions on new buildings."

In a rural area, surely having your house as one of three within 1.5 acres instead of being one of one, or worst case one of two, within 1.5 acres, would indeed affact the value of the property.

It has got to be less private, noisier and with a less spacious and open feel.

Personally I would not pay the same amount for that scenario, no way.
 
I don't think there is much debate over whether he should pay the same - he clearly shouldn't.

He needs to first decide if he is happy to purchase - based on 2 vs 3 houses, if this causes any issues as highlighted by Bronte, implications on resale value etc.

If he is happy then, he needs to place a new bid that reflects all above.
 
The OP has said 'I dont think that it will negatively effect the value of the property [if there were two additional properties nearby]. "

My point is, (ignoring the fact that the property being sold is itself reduced in extent), that I think that two additional properties nearby would affect the value of the property.

The OP has said that it would not, I am just questioning that.

And I agree, the OP needs to step back, look at the overall picture, and place a bid (or otherwise) on what is actually being sold, bearing in mind the impacts of other potential developments.
 
One other point: losing 0.3 acre from a total plot of 0.8 makes a huge difference in terms of usable garden space.

If you subtract the footprint of the house (and arguably any essential items like driveway, footpaths, oil tank, shed etc), it will leave you with x amount of free space to use for lawns / patios / play areas etc. 0.3 acres lost from the free space will make huge difference to the spaciousness and usability of the garden, especially if its a house with a large footprint e.g. a bungalow. You could be talking about halving the free space.

Also impacts on the possibility of future extensions etc.

0.5 acre is the bare minimum IMO for a house in a rural area. I would strongly prefer a 0.8 acre site, as would many other (future) buyers.
 
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