Making the move from FTB to 2nd time buyer

jw2003

Hi,

Forgive me if I'm being simple here but I am looking to move to another part of the country and have started to eye up houses of a similar value to ours going by what they are up for sale for.

Now I have read in these forums a number of times that what houses go up for doesn't necessarily reflect what they are actually worth. Stupid moment here, but how does that work? If the houses go on for more than they are worth then how do people manage to get a mortgage on them? This house was a repossession and they wanted a quick sale and so our offer was under the valuation anyway

There's a house like mine on the next road for £149'950 - if mine were to go on the market at the same price what could I realistically expect to get for it? Also, if I could buy for what I sold and my mortgage is fully portable then would there be any fees incurred my moving it or is it very individual and I should hunt about for the t&c's?

I'm fortunate enough not to have any negative equity in this house

Is there anyone who can lay it out in simple terms for me?

Much appreciated,

tyllwyd

I think you are getting too hung up on the idea that a house has a certain amount that it is 'worth'. All anyone can do is place their own value on the house, bearing in mind similar houses in the area and what they have recently sold for. So if a house is on the market for £149K, it might be that the vendors would only accept an offer of that amount - or more realistically, they'd probably be keen to accept anything over £140K, and might accept less.

A surveyor would come & do a mortgage valuation which may or may not come out the same as the price agreed. If the buyer has a large deposit they might be able to go ahead if the mortgage valuation came out as less than the selling price, but it will all depend on the circumstances.

If your mortgage is portable, my understanding is that you can take it to a new house but the mortgage company will treat it as a new application, so you will need to satisfy their criteria about equity, income etc. I don't know about fees - best to check with the mortgage company.

jw2003

Ok, thanks for that. I think a move is definitely on the cards now so I'll get mine valued while keeping an eye on how that one sells. Am happy enough with equity/income amounts for the mortgage but I didn't think it counted as a new product. I'll give them a shout. Thanks for responding

Banner_Stands

Hi,

If you are applying for a new mortgage then the bank/building society have to be confident that your house is worth the sum total of your borrowing plus additional costs should you default and they would wish to sell it to recover their money.

As part of the mortgage application process your house would need to be valued to satisfy the bank of this. The valuer would have knowledge of the area and would take into account this and many other factors when valuing your new home. Obviously the valuation is based upon market pricing at time of the estimate and as we all know, this is variable. Long-term however, even if your house decreases in value then it need not concern you unless you need to sell-up and move quickly.

Over time, house prices will rise and so I personally would not be overly concerned with any short term dips in the interim.

Lynn11

We recently moved house and managed to port over our original mortgage. We visited our lender to speak about this and discuss the amount we would hopefully pay for a house so that they could agree to the extra money we wished. For the extra money we needed we discuss all options and took out another fixed rate deal at 3.99% for 2yrs so that it finishes approximately the same as the ported mortgage. In essence we have 2 parts of our mortgage now and they are fixed until June 2012, thereafter we can decide if we wish to fixed both parts on a deal.

Hope this is clear enough, The lender should be happy with the valuation or home report and will be happy to discuss the next step if you wish to go that way, Good luck.

jw2003

Thanks for that

I am hoping to buy for what we sell We have been doing up this place so I have the last couple of jobs to finish off and I will start to get some valuations

tyllwyd

When you say that you hope to buy for what you sell, don't get caught out by the cost of moving - last time we moved, I hadn't really realised what it would cost in lawyers fees/stamp duty/estate agents fees/removal costs.

sonastin

There are a number of websites which help you to gauge what a house is "worth". https://www.zoopla.co.uk and https://www.mouseprice.com (to name but 2) can give you an estimated "value" for most properties. The accuracy of these is somewhat debatable but it can give you a starting point. Those sites, plus others like https://www.landregistry.gov.uk and home.co.uk (to name but 2 more) also give sold prices for houses that have been sold since 1995 (I think - date might be variable!). The Nationwide has a calculator that gives an estimated valuation based on what the house sold for, when it sold and what house price inflation has been doing since then.

Whilst these are pretty coarse tools, they can give you an idea of what a house is worth i.e what you might be able to sell your house for and what houses in your chosen area are selling for when you come to buy. Then you've got to decide how desperately you want to sell and whether you're prepared to pay a premium on a particular property because you really want that house. Its actual "value" is really down to what the buyer wants to pay for it...

jw2003

Eek - Stamp duty :eek: Might have to look for something cheaper then We've moved several times in the last 5 years so am well aware of the costs of moving but no idea about legal fees and estate agents fees... Makes you wonder how anyone can afford to move