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Debate House Prices
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Buyers blocked by low valuations
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Alot of newbies are going to get sucked in by the historically low current interest rates and pay a heavy price when they inevitaby shoot up in years to come. Low interest rates are enticing them into a classic bear trap.
Thats why the general advice (as pointed out by Ad in this very thread) is to fix for as long as possable.0 -
It was a shock because I realised how quickly I've become used to interest rates being low, that it's hard to imagine they'll ever go back up to 7-8% again (even though I'm sure they will).
7.89% is actually historically quite an average mortgage rate, there have been times in my lifetime when the mortgage rate was over 14%. If quantative easing gets out of hand, they could easily return to those levels in the next five years.“The ideas of debtor and creditor as to what constitutes a good time never coincide.”
― P.G. Wodehouse, Love Among the Chickens0 -
In the same position, mortgage valuation came in 13% (£19k) lower than our offer price on a new build.
As mentioned, there's no point having another valuation (especially at £300 a pop) so will just try and get the devloper to see sense.0 -
Now he's really miffed that he can't buy the property and says that if a willing seller and a willing buyer agree on the price then that's the right price for the property.
Absolutely fine if the buyer is paying with his own cash......but He isn't, He's asking a bank to lend him money to buy the property.
The bank are required to undertake due diligence should the buyer not be able to meet his commitments.
As other flats in the block are selling at £135,000 under distressed circumstances that's the value of the property to the bank, or at least that's the value of the property to the bank should they need to sell and recover their money.
He could pay £500,000 for it if it was his own cash...nothing to stop him...0 -
The biggest nightmare for those who have bought in the last few years and are not a long term fix rate is cost push inflation (prices going up, but wages frozen or reduced), which is already starting to rear it's head in 'life's essentials'.
My opinion is anyone not on a fixed rate, get one now, at least a five year one, but a 10 year being much better, and overpay.
Thats what Im thinking, get ready for back to the future.
As soon as people can actually buy houses again on a liquid market I reckon this also be when we will really see factors start to take effect
Amazing a fixed rate can be had for less then the old variable rate, maybe the advantage to already having a mortgage and house in a falling market is you can reduce costs long term even if you've lost some capital value0 -
i had this on my own surveyor on a cash purchase in August, it got valued at £360k instead of my offer of £385k. it was a result for me.
i've just had it re-mortgaged last month and you get a choice from a panel of surveyors - my choice of surveyor valued the same property for the bank at £425k. again a result for me.
if you get a choice of surveyors - choose the right one and do your research... some strictly value by square footage, others actually do their job and value the property for what it's worth.0 -
Er. Cash purchase August. Re-mortagaged March. Remortagaged? When did you have a mortgage on it if it was cash purchase? And why re-mortgage anyway? Are you freeing up cash for more investments?i had this on my own surveyor on a cash purchase in August, it got valued at £360k instead of my offer of £385k. it was a result for me.
i've just had it re-mortgaged last month and you get a choice from a panel of surveyors - my choice of surveyor valued the same property for the bank at £425k. again a result for me.
if you get a choice of surveyors - choose the right one and do your research... some strictly value by square footage, others actually do their job and value the property for what it's worth.
Valued at 360k. Prices down roughly 10%. New value 425k. Says something about the market, all down to people's views.0 -
Er. Cash purchase August. Re-mortagaged March. Remortagaged? When did you have a mortgage on it if it was cash purchase? And why re-mortgage anyway? Are you freeing up cash for more investments?
Valued at 360k. Prices down roughly 10%. New value 425k. Says something about the market, all down to people's views.
cash gives you a speedy purchase, closed it out in 10days. good for a seller who needs cash. down side is that you can't remortgage for 6 months once you own a property. plus side was that with interest rates that low - why keep it in cash...
that's my point about surveyors - different companies and different surveyors will have a different valuation due to how they do it.
yes - i am freeing up cash to buy something else. there is no point it sitting on my offset mortgage as i currently have a 1.4% rate mortgage. once rates move up i shall plough cash back into it to offset the interest. i don't think that will happen in the next year so i can afford to do what i did in August again.
incidently, i haven't seen anything worth investing in for about 3 months.
either it's overpriced or not good enough for someone to rent long term.0
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