Considering buying a house from a friend? Am i mad?

A close friend of mine, known him since we were 5 or so, (our wives even go way back) is going to sell his house in the next year or so which is perfect for what we want, he's going to build something new himself. He's planning on renting it out and then selling it whenever it goes.

We're currently renting after moving home from abroad and looking to buy late summer onwards. He's told me he'll be happy with €250k for his place which is in our price range and as far as i can see a fair price, even perhaps a tad on the low side.

We havnt discussed it yet as it's obviously akward, but i reckon he'll save a bit what with EA fees etc. It'll also save him owning 2 homes as he's planning on renting before his new house is ready.

Just wondering how one would go about bringing up the subject, is it worth the risk bearing in mind the house is near to perfect for us but that we wouldnt want to jepordise a friendship. I dont want to abuse our friendship and try to rip him off but on the other hand i dont want to pay over the odds etc. In regards to trust they'd be the most trustworthy ppl i know.
Im sure it's crossed their minds aswell, ie the practicality of selling to us.

Get an independent valuation from a local estate agent?

cjh said:

Get an independent valuation from a local estate agent?

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I considered this but then that's involving an EA which will cost my mate 1% ie €2500! Do banks do this for free when they look at the loan? They mentioned a surveyor or something.

Think you should be able to get a valuation without having to conduct the sale through the estate agent...a phone call should clarify that.

Anonomouse said:

I considered this but then that's involving an EA which will cost my mate 1% ie €2500! Do banks do this for free when they look at the loan? They mentioned a surveyor or something.

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Get an all-in-1 job done by having the surveyor produce a valuation report as well as the survey and save time hassle and money.

Yep....I did something similar....got an EA to give me a rough valuation on a house in the same road, got the surveyor to do a valuation report. Another approach would be to pay for your friend to have an EA value his house for a re-mortgage perhaps.
Make sure that you and your friend agree that this is a business tx and there should be no probs.

Anonomouse said:

I considered this but then that's involving an EA which will cost my mate 1% ie €2500! Do banks do this for free when they look at the loan? They mentioned a surveyor or something.

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You can just get it valued by an estate agent, I got my house valued recently, cost me 130euro

Well im still humming and hawing over this!

I was at a viewing of a house a couple doors down from him today, in equal if not better condition, according to the EA the asking pricefor this was 235k, bids of 236k are in and she expects it to go soon for 240k.

My mate knows about this and im considering telling him we'll match whatever the result of that house turns out to be.

any opinions on this approach, how much will my mate save by not involving an EA? Is it 1% ie 2.4k?

Well the market seems to think that prices have further to follow. Secondly, what the EA told you is the usual dribble which they patter about. She may be right -- then again she might be spouting off a load of bull. I'd say nothing to him for the moment as you are a friend, the price you mention now is the price you will have to trade on, if you don't want to fall out with him.

Your friend should ask an EA for a market appraisal. This should be free and well give you both a documented value.