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Halifax valuation makes property 20k less than my asking price offer

Hi all,

Halifax have valued a property im trying to buy at 20k less than what ive offered. The property has just been done up and is well over the asking price using the house price valuation tool Martin suggests in a recent post.

The valuation report doesnt even mention it has a en suite and a big garden for a london property, you dont get much for a £400 mortgage valuation fee!

I paid a mortgage fee upfront, what are the chances of getting this back?

From previous conversations the seller is no way going to drop 20k and just rent it instead.

Is there anyway i can object to a valuation? ive paid for a service and all i have is about 6 sentences, it doesnt even mention the en suite. It says the bedrooms are small but the measurements are 4.47m x 3.51 and 3.66 x 3.23 with en suite and another bedroom at 2.82 x 2.72 which is small but still a double.

Are banks deliberately undervaluing ? Ive checked everything else in the area across multiple estate agents and flats that are only 2 bedroom cost 5k less that im paying without a garden. this one has a garden and a extra bedroom.

Should i call the valuer? his details are on the report. I dont know what the best course of action is.

Any advice or people in the same situation i would be grateful to hear from you.

Thanks
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Comments

  • jonesMUFCforever
    jonesMUFCforever Posts: 28,898 Forumite
    Part of the Furniture 10,000 Posts Name Dropper
    Either you have not heard of the credit crunch and the subsequent crash in the housing market or you are just too soft.
    By all means reduce your offer to the vendor as this is currently all there is on the table. They may well want to rent out - but will this cover their mortgage repayments?
  • muggz
    muggz Posts: 97 Forumite
    ive heard of the credit crunch

    Its a developer so the property has no mortgage
  • brit1234
    brit1234 Posts: 5,385 Forumite
    muggz wrote: »
    ive heard of the credit crunch

    Its a developer so the property has no mortgage

    These developers are still refusing to drop their prices and have been fiddling the land registry figures for years. Just wait a month or too and they will go bust, then you can buy the property cheap at auction. :beer:
    :exclamatiScams - Shared Equity, Shared Ownership, Newbuy, Firstbuy and Help to Buy.

    Save our Savers
  • kunekune
    kunekune Posts: 1,909 Forumite
    While I agree with the people who point out that prices have dropped, etc, it does sound odd that the house described in the report does not sound the same as the one you're trying to buy. Was this a valuation you commissioned or the bank? If it was the bank, could you check there hasn't been a muddle? Or get your own valuation and take that to them?

    In NZ, valuations always came with pictures they'd taken, so you knew for sure it was the right house they'd done!
    Mortgage started on 22.5.09 : £129,600
    Overpayments to date: £3000
    June grocery challenge: 400/600
  • Banderman
    Banderman Posts: 351 Forumite
    muggz wrote: »

    Halifax have valued a property im trying to buy at 20k less than what ive offered. The property has just been done up and is well over the asking price using the house price valuation tool Martin suggests in a recent post.
    s
    What house price valuation tool is this please?
  • Microstar_2
    Microstar_2 Posts: 433 Forumite
    The valuation is as much for Halifax's benefit as for yours. It is effectively 'their' property until you have paid off the mortgage. They don't want to overpay in a falling market and the valuation will be realist for current market conditions.. Suggest you take note of this valuation rather than contesting it.
  • guppy
    guppy Posts: 1,084 Forumite
    Part of the Furniture Combo Breaker
    muggz wrote: »
    Are banks deliberately undervaluing ? Ive checked everything else in the area across multiple estate agents and flats that are only 2 bedroom cost 5k less that im paying without a garden. this one has a garden and a extra bedroom.

    The surveyor is attempting to estimate market value, rather than the value of the property to you personally. Since the market is falling, he may well be cautious, given how hard it would be to resell the property in current conditions.

    It may be this is your dream property, and therefore you are prepared to pay more than most other people, but that is obviously of no consequence to the lender.

    As Microstar says, consider this a warning sign before proceeding.
  • muggz
    muggz Posts: 97 Forumite
    On the report in the guidance notes it says

    "you have chosen a valuation report which is a limited inspection highlighing only those items which we consider will materially affect value"


    But im guessing a en-suite, new kitchen bathroom, spot lights and wooden floors throughout would affect value, however it doesn't mention any of this.

    It also says

    "futrure saleability may be affected because of the fact the bedrooms are so small"

    The problem with this comment is that all the rooms are doubles and have storage space built into the walls. Im writing a letter asking what is considered a small bedroom size for a 3 bed 280k property in London because ive been looking for 6 months and its the biggest set of 3 bedrooms ive come across.

    "Properties of this type and age in this neighbourhood are valued between 250-265k"

    If this is the case then every single 2 and 3 bed property for sale in the area will never get a mortgage. If i could find a newly decorated 3 bed with en suite for 265k i wouldnt be paying 20k (asking price) more for one. Its already come down by 30k which makes a good deal as it is.

    Im writing a letter challenging these comments and bits left out, i dont know if i will get anywhere. The entrance to the en-suite is easy to miss but the rest feels deliberately left out.

    guppy i understand im just comparing it to everything else on the market in the same area of the same type. I know the market is dropping at the moment i guess its just hit me hard that the money ive already paid is going to go to waste..
  • Doozergirl
    Doozergirl Posts: 34,057 Forumite
    Part of the Furniture 10,000 Posts Name Dropper Photogenic
    Are you joking?

    To start at the beginning, the valuation is not for your purpose at all. It is a fee that you pay to lender in order for them to go out and value the property to decide if and what they will lend you against it. If they don't think it is worth it then it is more than the valuer's jobsworth.

    Some lenders don't even let you see the valuation report.

    There is little point in writing a letter. It isn't a survey for your benefit at all. If you want to contest the valuation you will need to come up with evidence of similar properties selling for more money than yours.

    This is a very useful tool for you which you don't seem to appreciate. You can use this as a renegotiation tool to purchase the property at the right price. If it happens once, then it is likely to happen again to the vendor with another buyer. If they rent it out, so be it. Find somewhere where you're not paying a developer's premium. Sorry to say that if they have already dropped it by £30,000 it doesn't make it a good deal - it means that they have overvalued their own property and it's still just as likely to be overpriced now. Houses don't come with set price tags and 'valuation tools' should be taken with a very large pinch of salt. I've seen wild overvaluations and don't use them at all.
    Everything that is supposed to be in heaven is already here on earth.
  • Doozergirl
    Doozergirl Posts: 34,057 Forumite
    Part of the Furniture 10,000 Posts Name Dropper Photogenic
    muggz wrote: »
    But im guessing a en-suite, new kitchen bathroom, spot lights and wooden floors throughout would affect value, however it doesn't mention any of this.

    This gets more bizarre. No, spotlights and wooden flooring don't affect the value of a house. They might make it more saleable but they certainly don't add value. If I bought a house that needed a new kitchen and bathroom then the house would be downvalued by the cost of those items. A house with a nice kitchen and bathroom will fetch the best price but it won't increase the value above the cost of the work.

    As for spots and wooden floors, God help me, it's probably worth about 1k more than an identical house with laminate and pendants.

    Some property developers think they increase value with items like that and unfortunately some buyers believe them. I put beautiful things in my houses because I know it makes it desirable but the profit comes from buying cheap, not throwing fancy fittings at it -they just help it sell. We don't overvalue our properties by £50,000 because it's got oak flooring and we've never had a house undervalued by a mortage company yet.
    Everything that is supposed to be in heaven is already here on earth.
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