New build undervalued

System

It has always been the case, based on 40 years and 6 new build homes, that a valuer working for a lender will come up with a figure that is less than the offered sale price. Why - because the lender is interested in a valuation that will sell the property on quickly in the event of a mortgage default. This doesn't mean that the developer has set a price that is too high. The 'value' is down to what a buyer is prepared to play.

FWiW, I have just completed on the sale of my current home. We sought valuations from 3 different local Estate Agents. There was a £75k difference between the highest and the lowest valuations. As an offer was made in days, it could be argued that we pitched the sale price too low. Equally, I could have asked for £25K more and be writing this 3 months on with no buyer in sight. I did though offer £10K less than the asking price for our next house plus we negotiated about £8000 worth of extras (such as a water softener; EV charger; wooden doors; carpets throughout; an extra wardrobe and a wood burning stove). the logical conclusion would be that my new property was slightly over priced! The advantage of dealing with a small builder is that cash flow matters so there are often deals to be made for a quick completion.

happybiker

ffaruk wrote: »

I’m having some difficulties with a new build ftb purchase. Nationwide have valued the house at 270k, whilst the asking is 279,995. RedRow are not moving at all and are refusing to even consider.

The last 3 bed sold at around 260k. The valuation form didn’t include and comparable or anything, the broker said there are none (mines is 1 of 2 last 3 beds left in the side of hundreds).

Broker trying to push me to halifax.

Any advice on what to do? There is one house that went up for reservation same time in May but is still available, and the price for these 3 beds have gone up considerably.

I need some help on how to get RedRow to reduce the price or offer some icentives to help this.

Before buying from Redrow, investigate the leasehold/freehold situation. It appears that Redrow have not been completely honest about it in the past and you could make a very expensive long term commitment

PersianCatLady

Amst wrote: »

I'd personally be inclined to trust the neutral/impartial valuer who is acting on both your and the lenders behalf in valuing the property (using comparables which also seem to undervalue the house) over the pushy sellers and builder of the property who are looking to make a profit on the sale.

But that's just me. See how quickly they agree to drop the sale price by £5k when you tell them you aren't interested anymore...

I agree.

Trust the impartial valuation.