Q&A

Should we drop price after sale is agreed?

Q After long drawn out and difficult negotiations (these buyers first expressed interest in February while the house has been on the market since last September) we went sale agreed in late July, subject to survey and mortgage approval. We have already dropped our price by 28 per cent if you add up the two drops between September ’08 and when this couple began (their hard) negotiating. They have now come back with a lower offer – even though we are sale agreed at an agreed price. They say the house needs €50,000 put into it – something we find hard to believe and they want that taken off the price. My husband wants to cancel the sale agreed and start again with a new agent. I say drop the price. Any advice?

AThe buyers are flexing their muscles and who can blame them? Some sellers who have already dropped their prices by way more than 28 per cent without a hint of a buyer will be envious of you. But the real issues are: can you afford to sell at that level and do you want to sell now? Will dropping the price even more put you in negative equity? If so then you will end up owing the difference to your lender. If it's a case that a reduced offer is too hard to bear (our lovely house is worth X, the cheek of them offering only Y), then you need to get over yourself. Sale agreed has never meant very much. In boom times it gave buyers false hope, now it's the sellers who get hopeful. If you really want to sell now, have one more go at negotiation, trying to reach a point both sides are happy with and with an agreed closing date for the sale. If they are still around and have paid for a surveyor then they are interested. If that doesn't work, it's time to sit down with your agent and discuss new tactics.

My buy-to-let has me in financial trouble

Q My investment property is crippling me. The rent covered the mortgage four years ago but in the past two years, because of dropping rents and increased service charges, etc, I have been supplementing the mortgage payments with my own income – there is now a €350 monthly shortfall which I am finding hard to manage. With rents on a slide, I can’t see this situation getting better and I don’t know what to do. Selling the apartment is not a runner as it is in negative equity.

AIf by hard to handle you mean you may soon be unable to meet the mortgage repayments then talk to your lender now before it gets to that very dangerous point. Is the mortgage interest-only? If not, the lender might move you to an interest-only mortgage which may ease your repayments? Can you increase the term of your mortgage – this decreases the monthly repayments? Can you increase the term of your mortgage on your principal private residence (presuming you own it) to lower your monthly outgoings? Or is it time you asked yourself whether this "investment" is really that at all (capital appreciation is years off and it's costing you dear) and consider selling now for as much as you can and taking the negative equity hit?

Send your queries to Property questions, The Irish Times, The Irish Times Building, 24-28 Tara Street, Dublin 2 or email propertyquestions@irish-times.ie. This column is a readers' service and is not intended to replace professional advice.