Inflated prices means banks won't lend on their valuations

underthesea

It's so inflated it's ridiculous. We have a 20% LTV and the disparity with the banks valuations not just a few k...we're talking 20k. It makes it impossible to buy.

In one case we've had the surveyor said it needs repairs but we're talking 5k worth of repairs. We have compared property in the last 1/2 mile and the place is still cheap but it's been valued 3 times 35k under the price people are willing to pay, but now can't because of the valuation which holds more weight than what people are willing to pay. Unfortunately they are the gate keepers unless anything can be done otherwise. The only thing I see happening is over seas investors with lots of cash buy and the people here who work to save and live in the area can't move. sorry for venting, i'm sory frustrated.

spidereyes

john-306 wrote: »

2 estate agents have valued a house we are interested in at 315k and 325k, the surveyor valued it at 280k, nothing comparable has been sold in the immediate area for 12 years. Looking on Rightmove and Zoopla at houses around the same prices in this area puts the estate agents as the more likely true figure, but would the lenders agree?

This is what worries me, im having my mortgage valuation done on monday and I think for the size and condition of the property its very fair price that we are paying, (we got it £5k under asking price) although we are talking about much lower prices than you.

Our particular house is part of an estate built in the 1980s but its right on the edge of a much older council estate, rightmove shows the prices of the ex council properties which arnt compareable properties.
The other properties sold in the actual estate we are buying in are more modern and built in 2003, again these arnt comparable as these properties are so much smaller. Nothing at all has sold from the older part of the estate in the last 10 years (our vendors bought the place new in 1985).

Worries me that a valuer is going to see that all other properties in the area sold for 35k less than what were looking at paying.

Thrugelmir

underthesea wrote: »

The only thing I see happening is over seas investors with lots of cash buy

Those with pockets bulging with cash will always win out. As houses are often unique objects. Resulting in people more than willing to overpay for something they intend to own for decades. So one a particular property comes on the market there can be very high levels of interest.

A while back there was a property near Marlborough in Wiltshire that had a selling guide price of £2.25 million. Such was the interest that it received bids from 63 different parties, ultimately selling for £3.75 million. The valuation was meaningless.......

getmore4less

underthesea wrote: »

I'm hoping someone tell me this isn't a catch 22 situation...

Houses are being inflated by the market and are priced/go for much more than their valuations. The problem is, you can't get a mortgage as the bank values the place much lower than the offer price so won't lend the money

How do you get out of this situation? It's hard enough to buy without this over inflated complication!

Its easy and nothing to do with the valuations or the lending

The people with the bigger deposits get the houses they can nearly always outbid those with small deposits.

You keep saving untill you get to the top of the deposits pile.

PeacefulWaters

Butti wrote: »

If banks suspect we are on the edge of a bubble thay will try to push prices down.

Mortgage lenders have the most to lose from falling house prices. They're best served by house prices rising marginally faster than economic growth.

Butti

adindas wrote: »

Valuation is not an exact science it is quite subjective matter.
How could you sue them if they are already acting professionally.

There are a lot of instance the a property in London sold in the auction for cash buyer sold with much higher then the asking price. Look at here for instance:
http://www.dailymail.co.uk/news/article-2602592/Sold-550-000-garage-south-London-went-TRIPLE-asking-price-bidding-frenzy.html

Keep in mind some potential buyer, the executioners might already use surveyor to determine his maximum bid. Are they able to sue the surveyor because their surveyor value the property with £P but sold with 3x£P (triple) ?

The asking price is not a valuation it is an aspiration.
At auction the valuation is theprice paid between a willing buyer and a willing seller. That is the definition of open market value.

amnblog

underthesea wrote: »

I'm hoping someone tell me this isn't a catch 22 situation...

Houses are being inflated by the market and are priced/go for much more than their valuations. The problem is, you can't get a mortgage as the bank values the place much lower than the offer price so won't lend the money

How do you get out of this situation? It's hard enough to buy without this over inflated complication!

They will lend the money if you have enough deposit.

Setting and agreeing a price is subjective.

If the properties are not selling at your price that is a fact.

thestrayed

It is so frustrating, especially as a ftb desperate to get on the property ladder. We have a 10% deposit and have just lost out on a 2 bed because the survey downvalued it by over £10k less than our offer and the vendor refused to budge whatsoever. We were almost at exchange stage as well :mad:

underthesea

thestrayed wrote: »

It is so frustrating, especially as a ftb desperate to get on the property ladder. We have a 10% deposit and have just lost out on a 2 bed because the survey downvalued it by over £10k less than our offer and the vendor refused to budge whatsoever. We were almost at exchange stage as well :mad:

we have more than 10% but still were in this stage too with a bigger down value. From reading through this thread, we've lost out to cash buyers from overseas who don't even want to buy the place to live in. Sorry we worked so hard for our deposits.

C_Mababejive

What we are seeing is the beginnings of ramping fuelled by those with vested interests.

People are being fooled yet again.

Our very own Mr Carney is concerned about it.

http://www.telegraph.co.uk/finance/bank-of-england/10838355/Bank-of-England-Governor-issues-warning-over-housing-inflation.html

What i cant understand is that Mr Carney points out that in his native Canada with half our population and infinitely more land mass,they build almost twice as many homes a year.

How can this be? Does it mean that they demolish a lot of homes every year? Does it mean that most canadians have two homes or does it mean that lots of homes get built and stand empty?

Further to that, if i do a quick search of Canadian Realty on a website such as Remax canada, i see that house prices, despite the alleged over supply and there being plenty of land,are no cheaper than in the UK so what is Mr Carney talking about?


He is a man who is taking this country for a ride. A boy wonder who is really just a good looking, charismatic personality who has conned the UK Government and is now conning us.