Scotland - Can Home Report Valuation be Trusted?

[Deleted User]

We're about to put a house on the market in Scotland. We had a couple of EA's around and one (famous one) valued the property much higher than the others. He also implied that they were able to get much higher valuations than other EA's. He gave examples of properties sold by them that got good prices and good valuations and identical properties sold by other agents that were valued much lower and sold for less.

Needless to say we were mistrustful of this (it didn't tie up with our research either) and went with another agent. But I just wondered if the new system is open to corruption? I would have thought that the valuation would have a huge influence over what you get for a property?

With the old system if one potential buyer's surveyor came in with a low valuation you could just sit tight and often another buyer's survey would come in much higher (this in fact happend to a friend). But with the current system if the surveyor gets it wrong what chance have you got of getting a fair price for your property?

googler

Deleted_User wrote: »

We're about to put a house on the market in Scotland. We had a couple of EA's around and one (famous one) valued the property much higher than the others. He also implied that they were able to get much higher valuations than other EA's. He gave examples of properties sold by them that got good prices and good valuations and identical properties sold by other agents that were valued much lower and sold for less.

Needless to say we were mistrustful of this (it didn't tie up with our research either) and went with another agent. But I just wondered if the new system is open to corruption? I would have thought that the valuation would have a huge influence over what you get for a property?

With the old system if one potential buyer's surveyor came in with a low valuation you could just sit tight and often another buyer's survey would come in much higher (this in fact happend to a friend). But with the current system if the surveyor gets it wrong what chance have you got of getting a fair price for your property?

Wow. A 'famous' EA..... care to drop a hint at which one? I'm confused, perhaps by your wording - did the EA imply that they routinely got higher selling prices than the others, or higher valuations for the Home Reports? How would they know what the other EAs valued them at if the other EAs didn't tell them?

The valuation will have a huge influence, because if, as the system intended, the HR valuation is used by the purchaser's mortgage lender as a basis for lending, it'll determine what the purchaser can afford. This is why the 'Offers Over' pricing has virtually disappeared, to be replaced by 'Fixed Price' or 'Offers in Region of'. At the end of the day, if you feel that a surveyor has grossly mis-valued your property, there's probably options for complaint or redress via the RICS. But what would you define as a 'fair' price if it isn't roughly that determined by an RICS surveyor? I'm also not sure what kind of corruption you're referring to. Clarify, please?

jakeleo09

in reply to your question. yes. from personal experience i beleive the home reports are open to corruption.
about 3 months ago we put our home on the market which is in falkirk and we went to a well know estate agent, lets call then re/home and we were told that he was good friends with a man at the surveyors and could influence the value and then asked us what we wanted for the property. we told him it had been valued last year at £75000 and since then it had undergone major works due to a flood so was basically brand new again.he disagreed and said it was going to be valued at no more than £63000, in his opinion. we decided against his offer to allow him to obtain the home report but went to the company he suggested ourselves. once we had made payment we received a voicemail from the estate agent telling us that the surveyor had been in touch with him, and was wondering when we were going to sign the paperwork with him. we gave no instruction to the surveyors that we were intending to use this estate agent but had hinted that we had heard of them through re/home. and guess what the value came back as??? £63000
we made a huge complaint which went to one of the partners and had recorded voice mail from both sides, one saying yes they have been in touch and the surveyor saying no we have not contacted re/home.The company then offered us the chance to boost our value to £69000 just like that, on the spot! we ended up getting our money back and got a new home report with another company which ended up fine. but definately is open to influence!!! do not trust anybody, dont mention any names, do it all independently if you can.

sorry for the long reply but its very frustrating for me and i feel that people who maybe couldn't afford to wait any longer to sell could easily be ripped off. we would have lost £12000 at the blink of an eye. and i suspect all along that re/home wanted to buy up the property themselves and sell it for more at a later date.

eco-friendly_2

With the old system if one potential buyer's surveyor came in with a low valuation you could just sit tight and often another buyer's survey would come in much higher (this in fact happend to a friend). But with the current system if the surveyor gets it wrong what chance have you got of getting a fair price for your property

In the current market surveyors are writing down values to help get the market moving, self interest-nothing new there.

The old system was a rip off to prospective buyers,.

[Deleted User]

Thanks for the responses!

We haven't had a home report done yet.

I'm not naming EA's as I don't think it's fair when I'm not even sure anyone has done anything wrong. But all EA's we've used are large and well known.

The EA that we signed up with says that they use the same firm of surveyors as the EA that said he'd get us a much higher valuation. (200k vs 170k - 180k)

The EA that claimed to get higher valuations (and therefore better selling prices) said that the surveyors always phone them up to ask what they think the house is worth. So he essentially implied that it was HIM that did the valuation.

[Deleted User]

jakeleo09 wrote: »

in reply to your question. yes. from personal experience i beleive the home reports are open to corruption.
about 3 months ago we put our home on the market which is in falkirk and we went to a well know estate agent, lets call then re/home and we were told that he was good friends with a man at the surveyors and could influence the value and then asked us what we wanted for the property. we told him it had been valued last year at £75000 and since then it had undergone major works due to a flood so was basically brand new again.he disagreed and said it was going to be valued at no more than £63000, in his opinion. we decided against his offer to allow him to obtain the home report but went to the company he suggested ourselves. once we had made payment we received a voicemail from the estate agent telling us that the surveyor had been in touch with him, and was wondering when we were going to sign the paperwork with him. we gave no instruction to the surveyors that we were intending to use this estate agent but had hinted that we had heard of them through re/home. and guess what the value came back as??? £63000
we made a huge complaint which went to one of the partners and had recorded voice mail from both sides, one saying yes they have been in touch and the surveyor saying no we have not contacted re/home.The company then offered us the chance to boost our value to £69000 just like that, on the spot! we ended up getting our money back and got a new home report with another company which ended up fine. but definately is open to influence!!! do not trust anybody, dont mention any names, do it all independently if you can.

sorry for the long reply but its very frustrating for me and i feel that people who maybe couldn't afford to wait any longer to sell could easily be ripped off. we would have lost £12000 at the blink of an eye. and i suspect all along that re/home wanted to buy up the property themselves and sell it for more at a later date.

So is it the case that the new company that you went with valued the house at £12,000 more than the other?

[Deleted User]

googler wrote: »

I'm confused, perhaps by your wording - did the EA imply that they routinely got higher selling prices than the others, or higher valuations for the Home Reports? How would they know what the other EAs valued them at if the other EAs didn't tell them?

Both - houses with higher valuations tend to get higher selling prices.

The home report (along with valuation) is published for all to see. He gave examples of two identical houses on the same street - the one they sold had a valuation of thousands of pounds (something like £30k on a house worth less than 200k) more than the one sold be the GSPC. His exact words where "I have no idea how they managed to get such a low valuation".

But what would you define as a 'fair' price if it isn't roughly that determined by an RICS surveyor? I'm also not sure what kind of corruption you're referring to. Clarify, please?

Yet if RICS surveyors are giving wildly differing valuations (I think that will almost certainly be the case on occasion) and *IF* it's the case that some EA's have influence and will bump up (or lower) the valuation then that most definately is corruption of the system in my book.

I can't see that they can do it routinely as statistics would show this up. I'm 90% sure that this was just a hard sell on the part of the first EA, but worth asking around to see if there is any pattern. Getting the highest possible valuation is probably the thing that will most help you to get a good price for your house.

jakeleo09

the home report was not influenced the second time around as it was a new surveyor and we gave them no indication of the price.
the fact was that the surveyors and EA were talking about the property to benefit not us but them. note, we didnt want the price bumped up to something ti wasnt worth, we just wanted the value, simple as that. if the new one had came back at £63000 then fair enough but it didnt and therefore i believe that they can be influenced. its not often that a surveyor will give the money back in full if they beleive they did an honest job. also, why did they offer to bump up the price after we complained??? surely if they had done an honest job they would have kept it at £63000 and not refunded us

[Deleted User]

Thanks Jakeleo09 - and I'm glad it worked out for you in the end!!

I *think* we might have already signed to say the EA can arange the home report. We signed up with them, but don't want to put the house on the market for another few weeks.

But even if we hadn't I'm not sure how I'd proceed. What's best - getting it done privately (cheaper at least) or having the EA do it? I have no way of knowing which would be best.

With regards to the two EA's and the discrepency between valuations. 2 identical houses close to me came on the market just before christmas - one with each agent. Both are valued the same and both are on at 'offers over' the same. I've just noticed the one that went with my chosen agent has just sold!

The two EA's are in fact owned by the same parent company.

I'm thinking of perhaps just airing my concerns with the EA prior to having the Home Report done and giving them the impression that if there's anything not above board we won't let it lie?

googler

Deleted_User wrote: »

The two EA's are in fact owned by the same parent company.

You're not taking membership of an SPC (ESPC, GSPC etc) as meaning the SPC is a 'parent company', are you?

[Deleted User]

No. Both agents are owned by the same company. I *think* it's a fairly recent development and one that (as far as I'm aware) isn't publicised.