Challenging remortgage valuation.

DTimon

• Hi there,
  I would like to share my story and perhaps get some valuable advise from the monesavingexpert community.
  I purchased my flat in Q3/2010. According to home report it was valued at 145k. I paid 140K. 80% LTV.
  The property was average tenement flat. The interior of the property was dated at the time of purchase and extensive redecoration was necessary. In particular the property had extremely poor single glassed wooden windows, cheap badly laid floor, standard cheap doors and very poor decoration of walls and ceiling throughout. However, it had new-ish central heating (installed 2008), which was a selling point to me. No smell of dump or anything like this was observer.
  In the course of 2011 – 2012 the property undergone substantial improvement. In particular
  • All five single glassed windows were replaced by high performance (rating A) UPVC double glassing windows.
  • All external walls in two bedrooms and sitting room were insulated with 50-75 mm high performance (rating A+) Celotex PIR insulation.
  • All floors and skirting boards except the kitchen were replaced with high quality modern flooring and new skirtings.
  • Four door out of 5 were replaced by stylish modern doors.
  • All ceilings in Bedroom 2, lounge, hall and kitchen were re-decorated and bedroom 1 ceiling modernised.
  • All relevant walls were re-plastered, two bedrooms, sitting room and the hall completely re-decorated with luxury wall coverings.
  • 19 units of electrical sockets, light switches and light fittings were replaced with modern ones.
  So far, I put approximately £13000 into the flat. Please note, I still have kitchen and bathroom to do, which I budgeted at 3500-4000k each.
  
  My current mortgage deal came to an end and interest rate ramped up from 3.39% to 4.79%.
  
  I decided to re-mortgage my property and found a good deal.
  At the moment I am in the process of disputing valuation of my property. I don’t really know how it works, but there are some good thoughts on this web forum and some others.
  
  My new lender to be, sent over their own valuators. A man in a suite and a notebook came over on one of the glorious and sunny days. He spent literally 30-50 seconds in the flat. Walked in, checked boiler, glanced at the bathroom, nocked on a random wall and walked away. His only words were, "mm, very modern!". I tried to talk to him with no much success and explain that the flat was substantially upgraded, new windows, insulation, doors, floor, blah blah blah.. In an few days time, the bank phoned back with valuation of 140k.
  I believe that the valuation they put on the flat is far too low, I expected 145-150k, with my sentimental valuation of 155k in current market conditions. But 140k is ridiculous.
  
  What I did next is mailed the bank with three statements:
  
  • Details of the flat upgrade, promising to gather all the financial evidence of investment if needed.
  • Details of 4 properties within 1km from my flat of similar size that were sold for 148-150k in the past 120 days.
  • Actual sold property trend available at propertystatistics ros gov uk suggesting that average house price in my area decreased from £133.059 in 2009/2010 to £132.242 in 2011/2012 or -1% only.
  
  On holiday at the moment, so cant do much… Waiting for the banks reply… But I anticipate they tell me to F.. Off. Any comments and suggestions on what else I can do are very welcome! Will keep community updated on the outcomes of the dispute.
  
  One next step that I could think of is to phone and shout at the valuators and send them the same info as I sent to the bank.. Can I ask them e. g. methodology and details they used to value the flat?

kingstreet

Find a new lender and hope you don't get the same surveyor? Lenders typically use Esurv, Countrywide or Allied.

Nothing you've done to the property is likely to add value. The comparables you have would be helpful, but the surveyor will have based his valuation on three recent comparable sales in the vicinity. Half a mile away might be considered too far. What was sold closer to your property?

Crashandburn

I would say you are fighting a losing battle.

I would have expected the works carried out to add value to the property and along the figures stated. However, the valuer on a flat is more worried about his PI cover and will be cautious with any valuation. Any excuse to trim money off and they will take it.

Even if you appeal it, then his line manager will back his surveyor 100%. Never ever seen one go an appeal further up the line and be overturned.

Half a mile not close enough KS???! Surveyor the other day was using comparables 6 miles away to justify his figures!

Dave_Ham

I concur, do not hold your breath expecting this to be overturned as it is incredibly unlikely.

They tend to look for structural improvement (hard in a flat I know) to measure an increase over this timescale.

As Kings. suggests, you may need a new lender.

Good luck and interesting how far they let you push them

kingstreet

Crashandburn wrote: »

I would say you are fighting a losing battle.

I would have expected the works carried out to add value to the property and along the figures stated. However, the valuer on a flat is more worried about his PI cover and will be cautious with any valuation. Any excuse to trim money off and they will take it.

Even if you appeal it, then his line manager will back his surveyor 100%. Never ever seen one go an appeal further up the line and be overturned.

Half a mile not close enough KS???! Surveyor the other day was using comparables 6 miles away to justify his figures!

I was trying to figure out if the OP is using comparables further away than needed to support his estimate, while the surveyor used closer ones to support his.

Difficult to establish the reasons why, not knowing the area, property etc. Same with the "improvements." Many of them will have improved saleability, but I can't see much scope for increased value in the eyes of a surveyor.

motch

kingstreet wrote: »

Find a new lender and hope you don't get the same surveyor? Lenders typically use Esurv, Countrywide or Allied.

Nothing you've done to the property is likely to add value. The comparables you have would be helpful, but the surveyor will have based his valuation on three recent comparable sales in the vicinity. Half a mile away might be considered too far. What was sold closer to your property?

Which of these 3 would be "more lenient" with their valuations?

Do repossessions in the immediate areas get included in valuations?

kingstreet

Repossessions don't feature ion the LandReg sales figures, so they won't be included in comparables and there's no way of knowing how a particular surveyor might react.

What I was setting out was the likelihood of getting the same surveyor, even if you apply to a different lender. It's possible different lenders might give different valuation instructions to a surveyor, but they certainly don't publish them for the rest of the world to ruminate over.