valuation

Easypd

Knew it was going too well! Sold to a csah buyer, buying from someone moving into rented. House is amazing, offer accepted at £172,000. Survey today, nothing wrong, but Nationwide have valued it at £150,000!

They have based around all other sales on that road, but they all have postage stamp gardens. this has 150 ft garden with outbuilding with power, massive lounge, wet room, conservatory plus many other things we just have not seen in houses for £200g round here, let alone £172,000.

what happens now, NW will still lend, but at a higher rate, as we have less equity. we are still happy at the price. do i challenge the valuation? Help!

Jamie

Milliewilly

These threads are becoming increasingly common - let me guess you were at the upper limit for the best LTV mortgage rate?

Easypd

Milliewilly wrote: »

These threads are becoming increasingly common - let me guess you were at the upper limit for the best LTV mortgage rate?

My thoughts exactly! However, we got a good rate and monthly payments, the higher rate is still less than our budget. I am more worried about the £22g supposed equity hit we will take. Can the agents really be this far out from the surveyors valuation?
Up until now, we really thought we had got a very badly marketed and underpriced house, as we have seen so many recently and have a good idea of the market that we would have paid £190 for this place and still felt like we got a bargain. I have contacted the agents and told them the house they are marketing has been downvalued and asked them to come up with justification for the price to show the surveyor. Maybe they will knock a few grand off to save the sale?

To be fair, the ceiling on the raod is £150, but there are 2 houses that have the massive gardens and unique features that he has not got a recent price to base valuations on. All the others are in the bracket he is quoting. I am happy with the house at this price anyway, just wondering how there can be a £22g discrepancy and who is really right?

I guess if we are prepared to pay, there will be others in the future?

Blacksheep1979

I still can't understand these threads with buyers wanting to pay more - yes there will be others willing to pay what you want to, might be 5+ years though...

Sammy85_2

Banks are seeminly undervaluing to protect themselves. It may be that the agents are correct in their valuations. Ours was undervalued by £15k.

Either the owners knock the price down to the banks valuation or you will have to find the additional £22k from your own pockets in order to proceed.

If you want the owners to drop the price, you will have to prove to them that its not worth what they are saying. Usually this is done by submitting them a copy of the surveyors report.

You say you have asked the agents to justify the price difference to you? why? are you planning to pay the extra from your own pocket? this seems like an odd move to make.

Fire_Fox

jamiepullen wrote: »

To be fair, the ceiling on the raod is £150, but there are 2 houses that have the massive gardens and unique features that he has not got a recent price to base valuations on. All the others are in the bracket he is quoting. I am happy with the house at this price anyway, just wondering how there can be a £22g discrepancy and who is really right?

I guess if we are prepared to pay, there will be others in the future?

Is this house really that much better than the others that it's worth over the ceiling price for 2007? What did this house and the other large one last sell for and when? Do you know how much the market in the immediately area has fallen since 2007? You can either challenge the valuation or try to knock the vendor down, I know which I'd rather do.

Blacksheep1979

Sammy85 wrote: »

Banks are seeminly undervaluing to protect themselves. It may be that the agents are correct in their valuations. Ours was undervalued by £15k.

Or shall we flip this statement round - maybe banks are right and EAs want to earn more commission? You do realise that banks will make more on lending more too so if they say it's not worth £x maybe they're being realistic?

Sammy85_2

Blacksheep1979 wrote: »

Or shall we flip this statement round - maybe banks are right and EAs want to earn more commission? You do realise that banks will make more on lending more too so if they say it's not worth £x maybe they're being realistic?

Absolutely, that could be the case, but since the banks got their fingers burned before i personally think they are covering their !!!!!! rather than being realistic.

Trollfever

Both Nationwide and Halifax have already reported house price falls in February. Nationwide said average prices dipped 1 per cent to £161,320, ending a run of nine consecutive monthly rises. Halifax reported an even sharper fall of 1.5 per cent, with average house prices dropping to £166, 857.

http://www.telegraph.co.uk/finance/economics/houseprices/7442568/House-prices-on-verge-of-double-dip.html

House prices can go down as well as up.



.

elise83_2

Absolutely, that could be the case, but since the banks got their fingers burned before i personally think they are covering their !!!!!! rather than being realistic.

I thought the same initially and was therefore dreading getting my valuation back, especially as it was through a company that I have read on this forum has been valuing places 10% below asking price. To my relief it came back this weekend bang on my offer price which is the best I could hope for really.

Interestingly a sale has fallen through on one of the apartments in my development and it has come back on the market at a whopping 45k above the price of the identical flat one floor below (sold back in November) and we're talking about 2-bed flats here on the 4th/5th floor of a building so literally the only difference is one storey (and 4.5 months). If some person offers asking price for it (and there are people who have been doing so!!) if the valuer knocks off 35k (just under 10%) he's still valuing the place at 10k more than the flat below and also at a price that's more in keeping with similar properties in the area. I'm therefore leaning more towards the opinion that valuers actually might be giving a realistic price of what a place is worth when all emotion and hype is stripped out of it.

To the OP: try and figure out how much you need off the price of the property in order for your Loan-To-Value ratio to put you back in the better interest rate range, then go back and try and renegotiate with the vendors on that basis. You never know they could accept considering there's no guarantee that another buyer wouldn't have the same problem later on. Obviously they could always say no in which case you could try and challenge the valuation as a plan B. Good luck either way!!

FlyingBrief

Like has been said by others, for a whole host of reasons, ideally you're better off with the lower value, OP.

But getting the vendors to come down to that might be a different story.

1] Find out how much they paid for it [lots of websites freely available that will tell you the information, but being a newbie I'm not sure if I'm allowed to create links to those here (marketing/plugging?)], as that will give you an inkling as to how much room they have to move on the price;

2] How long did they have the house on the market for before you came along with your offer?

There is no harm asking...nor is there any in challenging the valuation as a separate cause of action for the time being.