Under-valuded or over-priced?

NHB

_Andy_ wrote: »

Why would you even consider paying more than what a professional's told you it's worth?
You've paid the valuer to tell you how much it's worth in their opinion and now you dont want to believe it?

It was the valuer that the bank brought in so thought it may be a case of them being cautious...

NHB

Thanks for the advice everyone. It annoyed me at first but I may be able to turn the situation to my advantage and save a load of money! In the mean time I am trying another lender and they offer a free valuation so that will give me more info to work with.

poppysarah

Why would you get a second opinion on value? Do you want it to be valued higher or lower?

NHB

poppysarah wrote: »

Why would you get a second opinion on value? Do you want it to be valued higher or lower?

I want to see if the first valuation was correct and more info will give me more options:

If they both come back low then that strengthens my case to lower sale price.
If the new one comes back higher then I can borrow what I need.

In some ways the low valuation is good but I doubt the vendor will take 210.

tek-monkey

NHB wrote: »

I want to see if the first valuation was correct and more info will give me more options:

If they both come back low then that strengthens my case to lower sale price.
If the new one comes back higher then I can borrow what I need.

In some ways the low valuation is good but I doubt the vendor will take 210.

NHB wrote: »

It was the valuer that the bank brought in so thought it may be a case of them being cautious...

Surely the bank will only lend on their own valuers survey?

NHB

tek-monkey wrote: »

Surely the bank will only lend on their own valuers survey?

Yes that is true so I am going to get a response from two lenders, the second one will value it for free so no harm in finding out. Once the price is renegotiated I will have two deals on the table ready to choose from.

The whole situation tells me to push the price down but a second opinion is always useful, especially when house values seem so subjective. If there is a big gap in valuations that will raise more questions.

Milliewilly

princessamy86 wrote: »

It doesn't matter if he's correct or not, it's what the bank is willing to lend. Would you pay £18k more, just because the surveyor may have made a mistake? I wouldn't!

Its interesting that as an Estate Agent PrincessAmy86 you always side with the Mortgage Valuer on any of these posts about undervaluations for mortgages.

Do you ring your clients back on your books to tell them you must remarket their property at the valuation level / they must reduce to the mortgage surveyors valuation because the EA and the buyer have got the price wrong to stop the sale repeatedly breaking down at valuation survey?

So basically the EA is wrong everytime in their initial advertising even though the price has resulted in a sale usually below asking (so the buyer is wrong too in their market assessment) but this is still too high for a Surveyor even the OP who has had another Surveyor's opinion?

Maybe we should all get RICS Surveyors to value our homes as EA's are clearly not getting it right (and we are paying ££££'s for that priviledge) even though its not stopping buyers trying to buy?

The Banks are conspiring not to lend thats the simple answer so they are trying to force prices down so people cannot meet the LTV.

princessamy86

Milliewilly wrote: »

Its interesting that as an Estate Agent PrincessAmy86 you always side with the Mortgage Valuer on any of these posts about undervaluations for mortgages.

Because most of the time the OP is asking what they should do, and the OP is usually the buyer. If you were a buyer, and a surveyor downvalued a property you were buying, would you want to pay more?

Do you ring your clients back on your books to tell them you must remarket their property at the valuation level / they must reduce to the mortgage surveyors valuation because the EA and the buyer have got the price wrong to stop the sale repeatedly breaking down at valuation survey?

Yes, absolutely advise them to accept the downvalued offer. Chances are that if it has been downvalued, it's down to the vendor placing a much higher price on the house than the one it was valued at. I would ask to see a copy of the report to see if it was due to any major works that we would obviously not pick up at valuation, this normally is the case. In my office, we have only had 3 downvaluations in the past year, so I would say we are pricing correctly. However, I know lots of agents do overvalue to get the business, so this will clearly result in more downvaluations from cautious lenders.

So basically the EA is wrong everytime in their initial advertising even though the price has resulted in a sale usually below asking (so the buyer is wrong too in their market assessment) but this is still too high for a Surveyor even the OP who has had another Surveyor's opinion?

Not wrong everytime, don't forget vendors often ask to market at a much higher price. We sometimes don't even take properties on if the vendors are too unrealistic. Again though, not the same with all agents.

Maybe we should all get RICS Surveyors to value our homes as EA's are clearly not getting it right (and we are paying ££££'s for that priviledge) even though its not stopping buyers trying to buy?

That's quite a generalisation, can you really say that NO EAs are getting it right? Also, nothing to stop you not paying £s for the "privilege", if you choose to market your home with an agent then you choose to pay the fee.

The Banks are conspiring not to lend thats the simple answer so they are trying to force prices down so people cannot meet the LTV.

Basically, I "side with" the mortgage valuer as their word is normally the bottom line. Lenders farm out valuations to local firms, it's quite possible the same surveyor would be sent out both times. Either way, if the bank says no for whatever reason, then that's that! Try a different lender by all means but it's usually more costs incurred for what could possibly end up the same result. I'm not the only one with this opinion on here.

Milliewilly

princessamy86 wrote: »

Basically, I "side with" the mortgage valuer as their word is normally the bottom line. Lenders farm out valuations to local firms, it's quite possible the same surveyor would be sent out both times. Either way, if the bank says no for whatever reason, then that's that! Try a different lender by all means but it's usually more costs incurred for what could possibly end up the same result. I'm not the only one with this opinion on here.

Where did I say 'NO' EA's are getting it right?

There are enough posts on here to say there many who aren't and not because of essential works that couldn't be known about by the EA prior to marketing.

If as you say the EA's generally don't market the property if the vendor want too much for it why are we seeing nearly a post a day about valuations being lower than the (reduced from asking) offer? We never see posts saying buyers have grabbed a bargain because the valuer has valued the property for ££££'s more than their offer?

The fact that you pay an EA thousands of pounds for some sales administration work means they should be getting a correct figure as you are paying for a professional service. If local surveyors are used the EA should be aware of this when advising the Vendor what to market at. We are regularly seeing 15% discrepancies against marketed price and valuations.

I am not getting at the EA here, far from it its the Surveyors acting in the Bank's questionable interests imo but the Industry should work together as its the buyer who is footing the bill for the valuation each time and the seller incurring legal costs for every sale that falls through.


The OP has had 3 prices - one from the EA, one from his Surveyor, and one from the valuer and they are all different. Who can you say is wrong here? Just because the valuer holds the trump card because their opinion means funds are released doesn't necessarily make him correct.

marcg

I used to work for a housebuilder. When the recession first hit mortgage valuers were all dropping their valuations on new flats by 20%, irrespective of the original or reduced asking price. Why? Because of directive from head office to reduce the bank's exposure to risk. In other words, they offer you a 85% mortgage but then get around the fact they have only 15% of your money on the line by down-valuing the house so that in reality they have you at 65%. Valuers are supposed to be professional and independent but the reality is they aren't. This was proven when we organised our own valuers for our buyers who promptly confirmed our asking prices.

At the end of the day, the more important factors are: do you really want the house and can you afford the mortgage?