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Yeah it's difficult. I don't want to come out the dickhead in this. We'll negotiate up a bit, maybe even more than a bit, but the fact remains there's close to £40k of work required that we weren't really expecting, just to get it back to where we sort of thought it already was, and the house isn't and may never be worth £295k (Northern Ireland prices, yo)...
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I don't want to come out the dickhead in this.
If they've accepted an offer, knowing that the house needs major remedial works but not bothering to disclose that before accepting the offer, then I'd be pretty sure that you're not the dickhead in this case. It might be a bit unreasonable to expect a discount representing the entire price of the works, but I can't see there's anything wrong in expecting a discount representing most of it, especially when they knew it needed to be done.
This is where it gets really tricky. Old houses need work. There's always something to fix. It's not totally unreasonable for her to think 'that shit was priced in'.
Or maybe it is. This stuff is hard.
As above, that she's dropped the price at all is a good start. Make the EA earn his fee and negotiate further. And get on Rightmove and start looking for other houses as you might need to find another one!