Reinstatement Cost

I am in the process of buying a house and have a quiry with the reinstatment cost for the property estimated in the Valuation Report.

We are purchasing the property for £155,000.

It is a 3 bed, stone, slate roofed, end terrace with a brick built garage.

The valuation states:

Calsulated using BCIS Guide to house rebuilding costs.

Main Building £230,000
Garage £20,000

Thats a rebuild cost of £250,000 for a house worth £155,000.

Is this correct and is there any way I can check for myself. I cannot understand why it would cost so much to reinstate.

I can only think that the Main Building cost should be £130, not £230. Even then £150,000 would still be nearly the full value of the property.

Thanks

Daniel
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Comments

  • payless
    payless Posts: 6,956
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    STONE !!!!! thats your answer, ( a lot more skill in working with stone than brick, + cost of materials) ....now if it was a modern cavity brick ( well mainly block) off the shelf design you could be talking below PP for the insurance value

    I assume your query is because of insurance-
    If in doubt either ask a surveyor OR take a policy with unlimited ( or very high standard limit ) cover rather than a sum assured basis
    Any posts on here are for information and discussion purposes only and shouldn't be seen as (financial) advice.
  • mattymoo
    mattymoo Posts: 2,417 Forumite
    Market value is determined by a number of factors but mainly location, location, location.
    Rebuild value is the bricks and mortar cost plus labour and fees. They also ad a bit in for site clearance.

    A house in a sink estate in the North East could be worth £50k yet cost £200k to rebuild, conversely, a house in a desirable London suburb could cost you £750k yet only be £250k to reinstate.
    The two have no direct bearing on each other.
  • i240_Dan
    i240_Dan Posts: 24 Forumite
    Just ran it through this online calculator.

    http://www.plusoneservices.com/rebuildguarantee/index.asp

    Gives a rebuild cost of £123,609.

    Daniel
  • payless
    payless Posts: 6,956
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    so do you feel lucky ..and choose one over the other ( and either be
    under insured OR pay for more cover than you need )
    or do you take my above guidance ?
    Any posts on here are for information and discussion purposes only and shouldn't be seen as (financial) advice.
  • mattymoo
    mattymoo Posts: 2,417 Forumite
    I would ignore that guide. Just did my house with brick walls and slate roof.
    Then did the same data but with stone walls and a thatched roof.
    The figure was identical.

    I wouldn't trust it one bit.
  • clear_blu
    clear_blu Posts: 140 Forumite
    I dont understand, I assume that the survey and valuation was done by a professional. Why are you unwilling to accept the valuation done by someone in the business??
    I have retired from a career in Financial Services........Thank God. Any advice given may be as a result of senile dementia so dont take it too seriously.......;)
  • payless
    payless Posts: 6,956
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    clear_blu wrote: »
    I dont understand, I assume that the survey and valuation was done by a professional. Why are you unwilling to accept the valuation done by someone in the business??

    I think OP did not get given an insurance figure from surveyor ( not uncommon these days ) the figure he is questioning is from a website calculator
    Any posts on here are for information and discussion purposes only and shouldn't be seen as (financial) advice.
  • I would think that the fact you are in a terrace pays a part in this - a gas explosion for instance will probably damage next door as much as your own property - you would be responsible to pay for this (through your insurers obviously).
  • mattymoo
    mattymoo Posts: 2,417 Forumite
    The sum insured is only set for the insured's property. Attached or terraced properties make no difference as that element would be picked up under the liability section of the policy.

    Payless - I read it that the ERBC had been obtained from the surveyors valuation and the surveyor had used the BCIS figures - as you would expect. OP would be daft to ignore this advice.
  • payless
    payless Posts: 6,956
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    Yeah on re-reading it does seem that way ( rather than Op calculating himself ) ,so yes he should take tyhose figures - although if in doubt my advice still stands
    If in doubt either ask a surveyor OR take a policy with unlimited ( or very high standard limit ) cover rather than a sum assured basis
    Any posts on here are for information and discussion purposes only and shouldn't be seen as (financial) advice.
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