MSE News: House prices 'to climb further'

Emy1501

Really2 wrote: »

Drive by valuations are for mortgages not selling.

You can still get them if you have a low LTV (but still only mainly used for remortgage).
But if you were buying you need shooting if the house is second hand and you do not cover your self with a proper survey.

If the LTV is closer to the maximum LTV the mortgage company will usually want a proper valuation.

The last time I sold the buyer simply used a mortgage valuation to buy. This was and probably still is all the bank requires. The original post I responded to regarding surveyors pointed out that the mortgage valuation is paid for by the buyer for the lender. This is a valuation report not a home buyers report. As a homebuyers report is paid for and is the property of the buyer.

The reality is when valuing a property a surveyor will contact various agents to find out the worth of the property based on it being in good condition and then down value taking into account any problems the property may have.

Really2

Emy1501 wrote: »

The last time I sold the buyer simply used a mortgage valuation to buy. This was and probably still is all the bank requires.

????????????
You can not get a full offer (Not AIP) until some one as been out to value the property.
This is done by someone like countrywide and is within the buyers interest to get a full survey.
Perhaps you forgot when they came round, but I have never got a mortgage without having a valuation.
A mortgage company will not just give money out and never get the asset they are loaning against valued.

The valuation will be instructed by the lender but usually paid for buy the buyer. It is done to cover the lend if it is not correct, not to inflate house prices. It will have been done by a chartered surveyor.

Thrugelmir

chucky wrote: »

but that's the whole point of a RICS report - it has to be short term, max 3 months. valuations and surveys are not done 6 or 12 months in advance. they are done for purchases/sales in the short term.

I was referring to their full market reports not an individual valuation.

Taking selected soundbites out of well written balanced reports makes headlines, nothing else.

Thrugelmir

Emy1501 wrote: »

The reality is when valuing a property a surveyor will contact various agents to find out the worth of the property based on it being in good condition and then down value taking into account any problems the property may have.

Um yes. Seems a good idea. No single surveyor is going to know the latest sale values of every house in every locality.

chucky

Thrugelmir wrote: »

I was referring to their full market reports not an individual valuation.

Taking selected soundbites out of well written balanced reports makes headlines, nothing else.

soundbites - sorry you've lost me there

i've taken it from RICS themselves... :rolleyes:

However, the survey also contains some evidence that vendors are beginning to return to the market. A net balance of 15 percent of surveyors reported that new instructions had increased in October, compared to a reading of five percent in September.

As a result, the closely watched sales to stock ratio - a measure of market slack and a lead indicator of future prices-climbed a little further. It has now risen for ten consecutive months and stands at 30.

http://www.rics.org/site/scripts/press_article.aspx?pressreleaseID=147

these aren't soundbites - these are facts

Emy1501

Really2 wrote: »

????????????
You can not get a full offer (Not AIP) until some one as been out to value the property.
This is done by someone like countrywide and is within the buyers interest to get a full survey.
Perhaps you forgot when they came round, but I have never got a mortgage without having a valuation.
A mortgage company will not just give money out and never get the asset they are loaning against valued.

The valuation will be instructed by the lender but usually paid for buy the buyer. It is done to cover the lend if it is not correct, not to inflate house prices. It will have been done by a chartered surveyor.

Did I not say a mortgage valuation ie a mortgage valuation report? This is a report paid for by the buyer on the behalf of the lender. I do not know about now but pre 2008 these were the drive by valuations or in the case of my buyer the surveyor came in for no longer than a couple of minutes. All lender back them wanted to know was the house not going to fall down and was worth roughly what it was on for.

The above report was all you needed to convince the lender to lend. Some people would get their own home buyers report but alot simply relied on the mortgage valuation when buying.

Really2

Emy1501 wrote: »

Did I not say a mortgage valuation ie a mortgage valuation report? This is a report paid for by the buyer on the behalf of the lender. I do not know about now but pre 2008 these were the drive by valuations or in the case of my buyer the surveyor came in for no longer than a couple of minutes. All lender back them wanted to know was the house not going to fall down and was worth roughly what it was on for.

That is not a drive by, a drive by is as per the term no one going in the property.

As I said drive by are only used in cases of low LTV. I purchased in 2001 and had a valuation, and when I changed lenders in 2006 I still had a valuation (the later was a drive by as LTV was around 50%).

Your Idea are trying to make out that chartered surveyors and estate agents some how gang together to manipulate prices.

If they did why did so many mortgage valuations last year come in lower than sales price?

Thrugelmir

From the August report by RICS.

This is their summing up. Which I consider a balanced view, factual rather infering a bullish or bearish view.

One explanation for the recent change in sentiment is that buyers have been attracted back into the market because houses no longer seem unattainably expensive. Certainly stretched affordability was an oft-cited reason that buyers were being scared from the market as it neared its peak. So do the falls in house prices mean that houses are now closer to fair value, making an affordable investment?
There are two key measures of housing affordability, mortgage payments as a percentage of average pay and the ratio of average house prices to average take home pay. At the end of 2009Q2, mortgage payments (interest and prinprincipal) accounted for just under 34% of average individual take-home pay, down from 57% in 2007Q3 (or 23% and 38% respectively if adjusting for average household takehome pay instead).

That amounts to an average saving of around £4,900 per year. But higher deposits and lower interest rates are at least as important as falls in house prices in delivering these savings.

This point is also clearly illustrated by considering that although the average house price to average earnings ratio (HPE) fell back to 5 in June this year (from a peak of 6.3 in September 2007) it remains significantly above its long run average of around 4, emphasising that house prices are still expensive by some standards.
Stretched affordability is even more stark if we compare lower quartile average incomes with lower quartile house prices – calculations by the CLG suggest that, at the peak of the market, this lower ‘house price to earnings ratio’ peaked at around 7.25 in 2007, compared to a long-run average (since 1997) of 5.3.
But in London and the South affordability was considerably
worse with the average lower-quartile house price being around 9 times the average lower-quartile income.
In spite of continued affordability concerns, the recent pick-up in demand highlights that significant appetite for home ownership still exists. But the reluctance of potential vendors has reduced numbers of properties going on to the market, limiting the number of possible transactions to low levels. This has been indicated, for example, by very low ‘new instructions’ balance on the RICS housing market survey. Preliminary evidence also suggests that this limited supply in the face of growing demand has been providing a floor to house prices. That could explain the fact that, in three out of four of the past months, the Nationwide house price index has actually risen.But it is not clear that house prices have reached a bottom. In the current market, limited supply is at least as important as improving demand as a determining influence on house prices.

chucky

Thrugelmir wrote: »

From the August report by RICS.

This is their summing up. Which I consider a balanced view, factual rather infering a bullish or bearish view.

i think you're missing the point or your replying to something else

for this month (November) not August... there are a few peices of data that has been developing over quite a few months...

However, the survey also contains some evidence that vendors are beginning to return to the market. A net balance of 15 percent of surveyors reported that new instructions had increased in October, compared to a reading of five percent in September.

As a result, the closely watched sales to stock ratio - a measure of market slack and a lead indicator of future prices-climbed a little further. It has now risen for ten consecutive months and stands at 30.

Emy1501

chucky wrote: »

you're now saying you can confirm the first part and you made the second and third parts of your post up then....mmmmmm.... :rolleyes:

just google drive by valuations I don't know what 3rd part you are referring to