Valuation is lower than the offered price. Your opinion please.

adindas

[FONT=&quot]I have got valuation and home buyer report from a chartered surveyor.
It is pointed out that:
Some parts of External wall, Roof covering, Inside walls and partition, Floors is given: Grade 3

Note:
Grade 3= Serious defect and need to be repaired.
Grade 2 = Defect need repairing but not considered serious
Grade 1 = No repaired is required

My understanding that the valuation will never high than the offer price. But how often the valuation is lower than the offered price ?
Is it normal that the valuation always come lower than the offered price ??.

What do you think I should do, renegotiate the price, asking vendor to fix it before the exchnage of contract, or else ?

Thanks for your time. [/FONT]

jozbo

Are you buying with a mortgage? In which case you have no option but to negotiate down to the valuation.
Likewise if you're a cash buyer you should take into account the costs of the repairs (speak to specialists and have them inspect the faults if necessary) and go back to the vendor with a revised offer taking these into account.

JQ.

Personally I wouldn't ask the vendor to do the work. They are very unlikely to use the best quality materials and tradesmen to ensure a job that will last as further 30 years as they'll derive no benefit.

kingstreet

What is the valuation after the essential repairs have been carried out? Is this the mortgage report and valuation as well? Has a retention been recommended by the surveyor and applied by the lender?

liubeliu

So you offered near to £190K and the link says price is from £180K which is what the Surveyor has valued it at.

Offer £180K or lower based on survey and what the price is now listed at on the link.

vuvuzela

Personally I wouldn't rely on zoopla or other website estimates as frankly they're not very accurate. Go on something like https://www.nethouseprices.com and find the actual selling prices for that postcode and surrounding areas.

girl_withno_name

I think vuvuzela was suggesting that you look at the actual sold prices in the local area, here: http://www.nethouseprices.com/index.php?con=Search-Sold-House-Prices

You appear to have requested a valuation for the house you're looking to purchase - as the text you've quoted states, this would involve local agents actually visiting the property.

Using the local sold houses you should be able to determine what similar properties (in similar condition) nearby are going for (worth).

girl_withno_name

I'm not very knowledge in this area (and I'm sure someone else will offer advice also), but I believe that the HB survey is for your own usage as a buyer and not the mortgage lender.

I found this information online:
"A Home Buyers Report is considerably more comprehensive than a Basic Valuation and this time the surveyor is acting on your behalf. Furthermore it provide you, the purchaser, with some form of comeback in the event that the surveyor proved to be negligent in their reporting."

If you decide to ignore their expert advice then I would guess at "not much comeback" and I personally wouldn't class this as negligence in their reporting.

However, if one surveyor has valued the property at £8,000 lower than your offer then potentially the mortgage valuation will come in with a valuation at the same level (I can't 100% figure out if this has been done already)

Why do you not believe or trust the surveyor?

girl_withno_name

adindas wrote: »

Thanks again
[FONT=&quot]No, definitely not because I do not trust the chartered surveyor otherwise why do I need to pay them for their professional services?[/FONT]
[FONT=&quot].[/FONT]
[FONT=&quot]I know from reading few posts in this forum a surveyor will never value a property higher than the offer price. I understand that in many business sector the valuation is always lower that it should be as this will reduce their future professional liability if something goes wrong. I wonder if this also applies to Property surveying sector that is why I am trying to gather this information to make an informed decision whether to continue or to pull out.

[/FONT] [FONT=&quot]I am pretty sure that the valation submitted to lender is exactly the same wiht what I have got as we are suing the same surveyor I just add Home buyer report in addtional.[/FONT]
[FONT=&quot]
[/FONT]
[FONT=&quot]No, definitely not because I do not trust the chartered surveyor otherwise why do I need to pay them for their professional services?[/FONT]
[FONT=&quot]I know from reading few posts in this forum a surveyor will never value a property higher than the offer price, I understand that in many business sector the valuation is always lower that it should be as this will reduce their future professional liability if something goes wrong. I wonder if this also applies to Property surveying sector that is why I am trying to gather this information.[/FONT]

If your mortgage lender has the same valuation then this may be all they're willing to lend on (e.g. you'd have to renegotiate with the vendor or stump up the difference in cash)

I am curious to know why you opted to use their professional services at all if you do not trust them and are not willing to accept their professional opinion.

girl_withno_name

I can't see the explanation you refer to in #10, but nonetheless...

I believe that it would be more common for the buyer to renegotiate with the vendor (rather than pay the difference in cash) since, as you suggest, you are otherwise going to pay £190k for something which an expert in the field believes is only worth £182k. If you have the cash then I guess it's up to you whether you wish to pay over the odds ... but I imagine a lender won't be willing to do so.

In England and Wales it is usual for the buyer to pay for a survey to be carried out in addition to the mortgage valuation, it can provide peace of mind regarding the property's structure and condition - if you're purchasing a property to "do up" then this may be peace of mind that the condition is not brilliant, but no worse than expected. It can also give (as yours has done) an indication of necessary repairs, the costs of which you may wish to consider in your final purchase price.

zappahey

jozbo wrote: »

Are you buying with a mortgage? In which case you have no option but to negotiate down to the valuation.

This is only true if you're at the limit of an LTV or affordability threshold.