Right to Buy valuation too high

Mokka

We just got our RTB valuation and according to my internet research and three estate agents it's about £30k too high.

The landlord did not seem to have considered the impact of major works on the price (estimated to be over £20k) and which are due to happen next year. Also the property is on the top floor of a high rise building and i was told that it's nearly impossible to get a mortgage for that, so it can only be sold to a cash buyer.

The price seems in line with advertised property prices but not actual sold prices which are usually about 10% less.

Shall I apply to the VOA for revaluation or commission my own survey/valuation first?
We are potential first time buyers so very nervous about the whole process- would appreciate any advice you can give.

martinsurrey

are you a cash buyer?

Mokka

We would need a mortgage, but this does not have anything to do with the HRMC valuation? They just look at the prices of properties sold in the area, don't they?

martinsurrey

Mokka wrote: »

i was told that it's nearly impossible to get a mortgage for that, so it can only be sold to a cash buyer.

Mokka wrote: »

We would need a mortgage, but this does not have anything to do with the HRMC valuation? They just look at the prices of properties sold in the area, don't they?

If you’re going to argue over it, be sure you don’t contradict yourself so easily.

Mokka

I didn't realise I was arguing- I just need advice from someone who's got experience with RTB process.
I didn't want to make my post too overlong by explaining my particular circumstances.
To put it simply:
is the opinion of 3 estate agents and my own research worth taking the risk of applying to VOA or should I commission a survey/valuation first?

DieselASFC

Get another valuation if you're so sure, but be aware that you are bound to that second valuation, whether it's higher or lower. I'm pretty sure they don't factor in any major works on RTB Leasehold properties, but they do have to tell you what the maximum amount you would have to contribute for the first five years would be. I'm in the process myself, and our contribution over five years is going to be no more than 7k. It should say on the paperwork you have with the valuation on it.

lincroft1710

The VOA's valuation is usually lower or equal to that of the council/HA.

kingstreet

I'm probably not alone in wondering why, when this property is probably unmortgaeable and you need a mortgage, you are worrying about the valuation for the right to buy?

Would you be kind enough to clarify?

Mokka

Our valuation includes the estimated major works cost at £27k.

If I had to re-sell my property within the first year of buying I would have to repay the whole of the discount.

I was told by the estate agents who valued my flat that I could expect to get £175K for my flat (and with the caveat that I should be prepared to contribute to the major works) so the it could get as low as £160k.

So if any misfortune happened to us and we were forced to sell the flat we would instantly face a loss of over £30k.

This is not my understanding of what market value is.

It was my understanding that the cost of Major Works were supposed to be taken off the price.

If anyone has any idea on why the valuations are so wildly different I would appreciate any information that could explain it.

The major works are next year so we would not be able to remortgage to pay for them.

sandsni

Mokka wrote: »

The landlord did not seem to have considered the impact of major works on the price (estimated to be over £20k) and which are due to happen next year.

I would have thought major works would increase the value of the property rather than decrease, so maybe the LL has taken that into consideration with the valuation. Or is it that if you buy before they're done next year you'd have to pay for the work yourself?

Mokka

kingstreet wrote: »

I'm probably not alone in wondering why, when this property is probably unmortgaeable and you need a mortgage, you are worrying about the valuation for the right to buy?

Would you be kind enough to clarify?

It was my understanding that the discount on RTB counts as a deposit and with almost 50% equity in the property it becomes much lower risk to the lender.