Do separate Valuations by EA's and Lender match?

coolguycp1

How correct are the valuations done by EA's and are they normally closer to the valuation done by the lenders?

Yorkie1

EA valuations in my view are generally more than the price that will be achieved.

Lenders look at prices that are achieved at sale, purely to tell if they will get their money back if they have to force a sale.

Therefore, there will almost always be a difference between the EA and lender's valuation. If a new-build is involved, then this is even more so the case, because the lender will price it as a second-hand house rather than a new build - and downvalue accordingly.

holly_hobby

An estate agent asseses a property for marketing purposes i.e How much they think it will achieve on the market

The lenders suveryor values the property for mortgage purposes (for the purpose of the lender accepting the property as security for the monies advanced). The valuer will cite a figure that they believe is realistic and easily achieveable on the open market (should the lender need to resell the property on its possession).

There can be HUGE differnces between the 2 ..... EAs recieve commission on the selling price of the property, and have a duty to get the best possible price for the Vendor - so you can see why there can be discrepencies between the 2.

Should the lenders survey come back at a lower figure that the offer price (which should always be made subject to survey), the survey can be used as a further tool of negotiation to amend the agreed purchase price in line with the valuers comments.

Hope this helps

Holly