Renegotiating a Home Price After Going Sale Agreed

Sep 07, 2022

Home Price Negotiations

Can You Legally Renegotiate After Being Sale Agreed?

In Ireland being 'Sale Agreed' is not a legally binding agreement, it's merely stating an intention that both parties agree on the transaction of a home. Even though you are likely to have paid what is known as a "Booking Deposit", if the sale falls through for any reason regardless of the circumstances you are legally entitled to those funds back unless you have signed a contract stating otherwise.

Buyers are sometimes frustrated by a practice called "gazumping", whereby after a sale price has been agreed another potential buyer offers the seller a higher price to pull out of the sale with the original buyer and sell the property to them instead. It's not a one way street and when appropriate buyers also have the ability to renegotiate the sale price after going Sale Agreed.

The Risks of Reopening Negotiations

Generally sellers and their estate agents do not want to go back to the market with a home after it has gone Sale Agreed. This would likely add several weeks to the seller’s sale timeline. In addition, properties that have been on the market for a long time raise suspicion with buyers as in their eyes it could mean there was a problem with the property that caused a previous sale to fall through.

Despite the challenges involved for a seller to put a property on the market again, be prepared for the seller to pull out of the sale altogether if you try to renegotiate the price. The seller may prefer to deal with a more laid back buyer who is not going to cause them stress by dragging the sale out. Similarly in a market where home prices are on the rise it could provide the seller with a good excuse to privately search for another buyer to outbid or “gazump” you.

Reasons to Renegotiate a Sale Price

1. The Valuer Disagrees with the Sale Price

Once you are Sale Agreed, your lender will appoint a valuer to make sure the property is worth what you agreed to pay. If the Valuer values your property at less than the agreed price, one of your options is to renegotiate that price. If this happens it puts you in a surprisingly strong position as a buyer as if a valuer disagrees with a sale price then it’s going to be a challenge for the seller to find another buyer who won't face the same issue with their own lender and valuer.

2. A Surveyor Finds a Serious Problem

Any survey is likely to find some minor issues to address after the sale and you shouldn't try to renegotiate a sale price for routine maintenance costs. However in the case where your surveyor uncovers unknown or undisclosed problems with the property you may be able to debate the sale price Examples of where it may be reasonable to reopen negotiations are:

  • A survey uncovers pervasive dampness in the home that would require extensive damp proofing.
  • There has been non-compliant construction work on the property that would require addressing for safety reasons.
  • There is expensive roof repair work required that was not obvious from initial viewings.

If you would like to negotiate the price after being Sale Agreed due to surveyor findings it’s a good idea to get professional quotes on estimated costs of repair work beforehand.

3. Modifications Without Planning Permission

If you, your surveyor or your solicitor identify changes to the property that do not have required planning permission then a lender is unlikely to grant you a mortgage. Someone will need to foot the bill to retroactively apply for planning permission (called “retention planning permission”) or make changes to the property to bring it in line with local laws. Your options will be to either absorb the cost yourself, pay up front and renegotiate the sale price to factor in these costs, or ask the seller to pay to rectify the issue themselves before proceeding with the sale.

A Note on Morals

When renegotiating the sale price keep in mind that there are real people on the other side relying on the sale of the property. Just as it is frustrating for a seller to “gazump” a buyer after being Sale Agreed, it's also considered immoral to try to take advantage of a situation to put pressure on the seller to reduce the sale price without good cause.

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