New build undervalued!

Fahm

I got a call fron the sales lady on friday afternoon. She said they have let the regional director know about the situation and are waiting for him to come back with what he wants to do. She said ahes had a look at the second hand market and everything is cheaper....so she cant provide any comprables and not contracts have been exchanged so she cant provide those either. She said the regional director may agree to pay for another valuation (although i dont see the point of that as the banks take the lower valuation figure don't they?) or he may agree to lower the price. She said notnto worry about timings. Im relieved she hasnt said an outright 'no we can't do anything for you'. Best scenario would be for them to reduce down to 190 (I dont know how likely this is), next preferred scenario is for them to to 200k and il make up the shortfall. I really dont want another valuation to take place as that will make the process even mire long winded! fingers crossed, I'l probably find out next week what the regional director has said

alchemist.1

Fahm wrote: »

I got a call fron the sales lady on friday afternoon. She said they have let the regional director know about the situation and are waiting for him to come back with what he wants to do. She said ahes had a look at the second hand market and everything is cheaper....so she cant provide any comprables and not contracts have been exchanged so she cant provide those either. She said the regional director may agree to pay for another valuation (although i dont see the point of that as the banks take the lower valuation figure don't they?) or he may agree to lower the price. She said notnto worry about timings. Im relieved she hasnt said an outright 'no we can't do anything for you'. Best scenario would be for them to reduce down to 190 (I dont know how likely this is), next preferred scenario is for them to to 200k and il make up the shortfall. I really dont want another valuation to take place as that will make the process even mire long winded! fingers crossed, I'l probably find out next week what the regional director has said

Ermm why are you so desperate to buy this place at the prices quoted?

Fahm

The price quoted is 210k, I wont buy at that price. 190k which is what it was valued at will be ideal but if thats a complete no, then 200k is as high as I'm willing to go as it meets them in the middle. I have been looking for property for a good 6-7 months and im so sick of it now, id rather this one just goes through.

custardy

I would stand firm at 190K at this point.
They havens said no,and have no sales.

Fahm

they have no exchanged contracts yet as the leases only got released by the developers solicitors last week due to delays. According to the sales guys thiugh, theres been numerous other valuations that have valued it at 200k+.

Anyway, I will hold on and see what happens next week. Thanks for the help so far guys

MataNui

Are you mad?
Its a new build and its overpriced by about 20k already and will devalue faster than a typical 'used' property. Thats a lot. You wont get any more from the mortgage provider but thats not the real issue.

what is unbelievable is that you seem so desperate to blow so much money just because you want a 'new' house. Even if you raised the shortfall you will instantly be in negative equity by an amount that is very unlikely you will make back over the short to medium term.

Its valued at 190 so that should be the starting point to negotiate DOWNWARDS. Not up. Also a note about valuations. A house is worth what someone will buy it for, not what you want to sell it for.

If the banks valuation puts it at 190 then thats the max you should pay.

dgtazzman

I always love all the doom and gloom around the value of newbuilds. I bought one last year which I sold a few months ago, 1 year after buying it, with a 10k profit. It all depends on the local market and a load of other factors.

I would say it isn't worth what the lender's surveyor says it is worth, it is worth whatever you are comfortable paying for it.

Surveyors are human too, they make mistakes, they have bad days, they might lack information, leading to an educated guess... Yes, 20k difference is too much to ignore, but that doesn't mean finding a compromise is a bad thing, especially if it is to be a home, rather than an investment.

Jon_B_2

I think a lot of people commenting on this thread about new builds instantly devaluing haven't been in the market for a while.

In a lot of areas including outside the SE a lot of new builds go up in value within months of being sold.

I bought my house for £275k back in Jan. It isn't ready to move in til the end of Sept and a second hand exact same house type in a worse location sold for £285k in June. Bristol area.

Fahm

Looks like I may need to pull out. They are now suggesting I request another valuation and if it is downvalued again, they will pay for it. I told my broker this who said that my lender says there's no point as they will look at both valuations and take the lower one.

I told the sales lady I will probably putt out and she said to let her know asap, as soon as this afternoon if I am to pull out, Doesn't seem like shes bothered if I do. Shes inisiting other properties have been valued at 212k so she doesnt undertsand why this has been valued at 190k.

dgtazzman

You are right in saying a simple second valuation with the same lender will have little to no effect, unless a case can be made to overturn the original valuation. Only thing you could do is try another lender, but that comes with added costs, etc.

If it was me, I'd do as you have suggested and pull out, especially as the builder doesn't seem to be that cooperative. If they were actively helping to find solution, it would be a different matter...