Valuers as villains?

baby_boomer

One excuse being trotted out for falling prices is the role of valuers in a market of few sales.

Times property - Are valuers the real villains (It's the second half of the article)

"Valuers should take their place alongside bankers in the demonology of blame for house price falls - or so say some estate agents and buyers. They claim that valuers acting for mortgage lenders are routinely ruling that properties are worth much less than buyers have agreed to pay. As a result, lenders are dropping the amount that they will advance, forcing buyers to find extra cash or withdraw from the deal.

Critics of the valuers claim that these decisions are based on fear of future legal action from lenders - which professional indemnity insurance may not cover...."

EAs clutching at more straws, I'm afraid. When are they going to get it?

Dan:_4

Yes, I would hate to be selling house a house right now.

pizzagirl

baby_boomer wrote: »

They claim that valuers acting for mortgage lenders are routinely ruling that properties are worth much less than buyers have agreed to pay.

Bravo. Valuers are protecting buyers from their own stupidity. Better late than never.

Debt_Free_Chick

baby_boomer wrote: »

EAs clutching at more straws, I'm afraid. When are they going to get it?

Sorry to be thick, but why do you say this?

boyse7en

pizzagirl wrote: »

Bravo. Valuers are protecting buyers from their own stupidity. Better late than never.

But that's not their job.

Their job is to value a property at its current value, not what they think it might be worth next/month/year. It is up to the bank to decide whether the mortgagees are a good risk or not.

Equally, if the value of the property is less than the buyers are offering, then the Surveyor shouldn't be swayed by the buyers/estate agent/vendors to increase it.

baby_boomer

Debt_Free_Chick wrote: »

why do you say [that EAs are clutching at straws]?

Times_article_above wrote:

"Valuers should take their place alongside bankers in the demonology of blame for house price falls - or so say some estate agents

They're looking for anyone to blame for their plight. Looking for things that just need to be put right and it'll be back to 2007 - rather than accepting that house prices were fundamentally overvalued and there's no going back.

Alan_M_2

A very good friend of mine is a chartered surveyor. He's been valuing property during and since the last correction in the early 90's.

The surveyor receives an instruction, goes to the property and takes a look around to make sure it is what it says it is and to see there are no obvious structural problems.

They then call three local estate agents and ask them to value the property, also checks the various property sites of choice at current asking prices and historic data of what has sold in that road......Your surveyor then makes a judgment call on the value of the property based on this information.

In a falling market they are conservative, as they simply don't want too many claims on their PI insurance (which is hugely expensive as it is).

My friend was fired from one job during the last bubble for getting too many wrong and the company being sued.....therefore putting up the PI insurance to a level where it was unsustainable and the company folded.

This was in a time when prices were dropping like a stone and basically difficult to pin any sort of value on.....

I'd say, don't shoot the messenger.