How often are houses undervalued by the survey?

roseland69

Surely its good news in a way. It means the property was overpriced! Be angry at the greedy vendor asking too much rather than the sensible person valuing it at a market rate.

After all, who wants to be lumbered with an overpriced property in a falling market? I guess if you plan to live there for years it maybe doesn't matter so much. But even so, I can't imagine any other situation where someone says "halt, you are about to pay too much for this thing" and you reply "darn, but I really wanted to spend too much!".

This site is money SAVING expert after all!!

AAS

It's not that it's overpriced once they agreed to drop it to £145k or even £140k as they finally came back with today but it's the fact that I didn't think I'd need an extra £5k on top of our deposit (15%) and the £2.5k fees. We could easily afford the monthly payment as it'd be the same or slightly less than our rent but it's taken us 6 years to save this much. What I'm asking is, does this happen a lot? Do I need to wait a year and save more or was this just fairly unlucky. Next time I'm going to get the survey done before we instruct a solicitor if possible - we'd be happy to do the work (we've got a builder in the family) but if we can't boorow 85% or get a seriously cheap place it's not financially possible. Maybe we should wait anyway, who knows!!!

Orpheo

Houses are never undervalued by the surveyor. The surveyor is qualified to value houses, estate agents are not. EAs give a market appraisal, which means they pluck a figure out of their !!!!. Estate agents don't require any qualifications at all, in fact, today, I'm going to be an EA for the day.

Orpheo

TheSaint wrote: »

That happened to us too - real nightmare! We got the house a lot under its market value - yet they still insisted on holding on to some cash until we had repaired the faults. We still bought the house though, got the money back within 2 months. As others have said they are just being over cautious. If you think you got a bargain for the house you should try to get the money from family as quick loan

A house is never bought or sold for less than its market value. Its market value is whatever price you paid for it.

Orpheo

AAS wrote: »

Yeah I know we probably should but it's just been such a bad week - my partner's car had to be replaced as it was beyond repair and then our fridge freezer broke so we've just shelled out over £1500 sorting that out. Maybe it's not meant to be!

£1500 for a fridge-freezer. You really do have an eye for a bargain.

Orpheo

tristinh wrote: »

Thought I was reading about our situation there, but the valuation came in a whopping 25k under agreed purchase price PLUS a 10k retention for roof, chimney & damp. We were expecting the retention, but not the valuation!! Seller dropped by 15k, but we still can't do it. Hoping they will drop again, but I doubt it!

I did feel the valuation was a little cautious on the surveyors part, but he is there to protect the mortgage company - and us. He is the expert I guess!!

Hope yours gets sorted!

The survey is indeed to protect the lender's stake in the property. I think that it may be sensible to assume that the mortgage lenders and their surveyors have a better understanding of the true value of the assets.

pledgeX

This may be a silly question, but does the size of your deposit make a difference to whether they turn you down based on the valuation?

For example; If you offered 220k on a house, but it was then valued at 200k. If your deposit was 70k, would they care that about the 20k difference as you're puttin in such a wodge of cash which covers the difference?

AAS

Orpheo wrote: »

£1500 for a fridge-freezer. You really do have an eye for a bargain.

Ha, Ha....For the fridge freezer AND car - I think that's quite good!

AAS

Ok I'm not complaining about the valuation I didn't explain it very well - he did us a favour, I'm just saying that even if we get the vendor to reduce the price to reflect the valuation AND the work on top as the mortgage company effectively want £5k more up front FTBs like us are stuck. It's an expensive lesson.

kingstreet

AAS wrote: »

Ok I'm not complaining about the valuation I didn't explain it very well - he did us a favour, I'm just saying that even if we get the vendor to reduce the price to reflect the valuation AND the work on top as the mortgage company effectively want £5k more up front FTBs like us are stuck. It's an expensive lesson.

So you get the reports done, find out the true cost and put it to the surveyor.

Once you know the surveyor's/lender's position you can then think about moving forward.

If you can't get the work done because of the retention, you ask the vendor to do it and you'll buy the property for the value given by the surveyor post-remedial works.

You get the evidence the work has been completed, the lender lifts the retention and you can complete.