Valuation survey values house greater than land

ac427

I had a valuation survery carried out as part of a mortgage offer.

Some how the surveyor seems to think the house re-instatement cost is £237,000. The sale price of the house is £330,000.

The property in on a normal suburban street.

It did suffer subsidence and was underpinned >25 years ago.

The house is a deteched chalet bungalow with no special contruction.
Whereas the land is larger than average plot. The sort that has two houses rebuilt on it.

I cannot speak directly to the surveyor due to data protection so i guess i will have to go through the mortgage company that instructed the survey?

Do the valuation figures seem correct ?

Quentin

Does the valuation refer to the rebuilding cost or the market value.

If the former no problems. If the latter maybe you are overpaying.?

ac427

Sorry the £237k is the rebuilding cost. i'll edit the post accordingly

Quentin

In that case you are worrying unnecessarily.

If you have to rebuild then you don't have to buy the land which is included in the price you are paying.

ac427

Thanks Quentin, i thought that the general rule of thumb held the land at two thirds of the sale price.

In other surveys i have seen, the land is always worth more than the house built on it.

Spikey1

Reading between the lines you might be thinking about selling off part of the land ?


That being the case then you'd be better off asking for a market valuation on the parcel of land you wish to sell....with and without outline planning permission ?

ac427

Thanks Spikey1, I thought if the rebuild value was less myinsurance premium would be reduced also. Probably a false economy to look at it that way though i guess

Quentin

You can check the rebuild cost yourself using this free calculator:

http://abi.bcis.co.uk/

From what you say about the previous subsidence it may be that the land is cheaper than similar land that is free from any subsidence history.

InsideInsurance

ac427 wrote: »

Do the valuation figures seem correct ?

What are you actually trying to work out?

The sale value of a property does not equal the value of the land + the building cost of the dwelling. Whilst there should be some correlation between the two if it was as simple as that no builders would ever build a house as there'd be no profit margin. Plus in some undesirable areas the sale price for a property can be below the building cost of it.

That all said, it does look to be a high rebuild cost unless its made of something unusual either requiring specialist clearing (eg asbestos) or is high cost for the rebuild