Bank sales, repossessions.

 I've read articles which state that the prices quoted on websites for properties for sale by banks as repossessions are looked on as guideline prices, and the banks are looking for reasonable offers on these prices.  Does anyone have experience of negotiating for a reposession, and what percentage is likely to be looked on by the banks as reasonable and enough to secure a sale.  Take for example, a 100k.euro apartment, any general guidlines on an offer likely to be accepted, or is a generalisation too simplistic an approach? Thanks for the advice folks.

This message was last edited by W.J. on 26/01/2013.

It all depends because a lot of the time they have a 300k property up for 140k because thats the debt on it so there is very little negotiation.

But as many of the bank propertys are garbage and there is a rediculous surplus with more coming on the market daily i would say the best offer on a 100k property would be depending on how big your nuts are.

I have offered 100k on an 180k property at which they shut their books and just dismissed it

then recieved a call many months later telling me they will accept the offer.

at to which i reply , i can go 50k on that property now the market is more screwed.

i am waiting for them to call me with the 50k accpetance.

Just offer what you think you can get away with.

a normal rational person may say take 20% off

but if you actuallly watch properties and consider offering 20% less but never get round to it (like me) you quite often find it reduced on the website by 30% 4 months later (like i have many times)

I am involved in this market and a statement that many of the bank properties are garbage is a bit of a sweeping statement as what we are seeing, are new properties, where the developers have had to return them to the bank because they cannot afford the mortgages and community fees, coming onto the market at big discounts

All the banks typically want to do is recover the original mortgage amounts given to the developers and avoid the on-going community fee obligations which at around €2000 a year soon mount up

If you look for example at properties recently sold by CAM on Polaris, and which nearly all sold out as they were at least 70% discount

I am always asked what's the catch and normally there are a few things to watch, the first is that even though these properties are new, unfurnished and never lived in, they are sold as resale properties and you pay a higher rate of transfer tax and the process can be more complex, takes longer as yes the offer goes to the bank for acceptance. Also there is an additional cost to get utilities connected, typically around €600 for water & electricity, €200 more for gas

Next thing to watch is even though the properties are new they are sold as seen, they may have been standing sometime and will often have some damages, they may have been broken into and have items stolen. Recently on one development we went to they had taken the kitchens and boilers from 5 properties, so you MUST check the property or have somebody do this for you

Watch out for any guarantees you don't get the opportunity to have snagging defects repaired or the normal 3 years from the builder because the builder may not be about anymore so the only fall back is the 10 years structural cover, same applies it there is AC fitted or white goods

On the debt front one good things is that typically the ban will have cleared everything but you still need a lawyer to check this, things like discharge of any mortgage or community fees, if previously occupied the previous bills but remember if you buy a property with debts on and you don't discover them, normally you become responsible for those debts

When  we entered this market we approached it in a different way, we actually visited the development and looked at the properties and paperwork, before listing and still found developments with no COH and where, even based on the discounted rates, that they would just be too expensive to get into a saleable condition.

With the properties that we then decided to list we then inspected and graded then noting the defects and getting the costs to repair and most of the issues we find are water ingress and missing items

It means that we have found some real bargains, for example 2 bed properties Frontline  on Corvera, originally €220k, now €60k

When you buy a property at such a low price, surely there is a big risk of complemtary tax coming your way!

I will not deny that longer term there may be an issue here, however on many resorts the actual valuations now of the existing properties has also reduced but really you should get some legal advice on this area because certainly in some areas, to increase tax revenues, they have made adjustments between the actual price paid and the Town Halls own valuations