Valuation Rut

goodallish

Hi,

I am currently waiting for a valuation back from Nationwide on a house that I've had an offer of £116,000 accepted on.

I rang them up yesterday to ask for an update and they told me that the valuation came back on Monday at £105,000 and that they are looking at the valuation over the next 4 days before getting back to me with a final decision.

The house was originally up last year for £150,000 which the estate agent at the time valued it at, but it has since come down to £120,000.

I really like the house, but if the valuation comes back at the £105,000 then would I be better to lower my offer to that and simply walk away if they do not budge? It's over a 10% drop in price with the valuation so I can't see them moving on price any more after the vendor took a while coming to accept my final offer.

I don't really want to lose the house, but at the same time I don't want to be paying more than what it's worth if it means I'll be putting myself in negative equity. Could the valuer have got it wrong and the property could be worth more than what they decided? Would they change their valuation if say for example they had marked the house to have no loft insulation when actually it does? Little things like that? If there are obvious things I can see on it when it comes back to be wrong, can I mention it to them to get a revaluation?

Houses in the area seem to be worth slightly more than the original asking price (I'm guessing in complete fit state) where as this does need a little bit of work doing, but mostly only cosmetics. The last couple of sales have also been slightly higher than the original asking price too, but there are only a handful to go off.

Thanks in advance for any advice.

kingstreet

You can't ask for a revaluation.

You can go through the valuation appeal process but to do so you would need recent (last four months) sold prices data on similar property in the vicinity (within 0.5 miles)

Check Land Registry to see what's there.

goodallish

£153,500 Semi-Detached, Freehold, Residential 22 Jun 2016 3 bedrooms
£147,000 Semi-Detached, Freehold, Residential 30 Oct 2015 4 bedrooms
£165,000 Semi-Detached, Freehold, Residential 28 Sep 2012 4 bedrooms
£169,050 Semi-Detached, Freehold, Residential 18 Dec 2009 4 bedrooms
£128,250 Semi-Detached, Freehold, Residential 21 Sep 2007

These are the most recent that have sold with the same postcode. The house I'm looking at is a 3 bedroom.

I know further down the road the postcode changes and the houses there are slightly cheaper, but would that affect the price of this house even though it is a different part of the road? There is a T junction and a care home between the two lots so to me I would have thought that their lower house prices wouldn't affect the side I am looking at?

davidmcn

goodallish wrote: »

Would they change their valuation if say for example they had marked the house to have no loft insulation when actually it does? Little things like that?

Little things would make little difference - loft insulation is worth whatever a few rolls of it from B&Q cost plus a weekend laying it, not thousands.

goodallish

davidmcn wrote: »

Little things would make little difference - loft insulation is worth whatever a few rolls of it from B&Q cost plus a weekend laying it, not thousands.

Makes perfect sense, thank you.

I guess I'll have to wait to get the report back and see what it says on it and get back to the EA to let them know.

eddddy

In my (very limited) experience, valuation appeals rarely work - but the 'mortgage professionals' on the board may know better.

For professional reasons, the valuer will stand very firm by their valuation. Otherwise, it becomes an admission to the bank that instructed them, that the valuer made a mistake in their valuation (which is bad for their reputation).

In my experience, once a valuer or surveyor has put their opinion on anything in writing, it's very hard to make them budge.

(Unless there is material information that they weren't told about.)

kingstreet

eddddy wrote: »

In my (very limited) experience, valuation appeals rarely work - but the 'mortgage professionals' on the board may know better.

No. Would agree totally.

Crashy_Time

Without a cash buyer who doesn`t care about wasting money the seller is snookered, offer them 100k or walk away IMO. Any chance of a link?

goodallish

eddddy wrote: »

In my (very limited) experience, valuation appeals rarely work - but the 'mortgage professionals' on the board may know better.

For professional reasons, the valuer will stand very firm by their valuation. Otherwise, it becomes an admission to the bank that instructed them, that the valuer made a mistake in their valuation (which is bad for their reputation).

In my experience, once a valuer or surveyor has put their opinion on anything in writing, it's very hard to make them budge.

(Unless there is material information that they weren't told about.)

Thank you, that confirms what I thought.

AFF8879 wrote: »

You're right that the seller will probably want to reject the revised downward offer, but all that will happen is they'll find a new buyer willing to pay more (or the same as you), only for the mortgage valuation to fall short again.

They had an offer of 125k last year and rejected it as another EA gave them a valuation of 150k. Purplebricks gave them a more 'realistic' valuation of 120k a couple of months ago. I'm the first accepted offer that has also gone ahead with the valuation. I have a feeling I'm the only one interested enough at the moment which is good for the seller, but obviously not good for them that I'll now be lowering my offer. Good in my situation of saving money, but of course that's only if they budge, which I doubt.

Crashy_Time wrote: »

Without a cash buyer who doesn`t care about wasting money the seller is snookered, offer them 100k or walk away IMO. Any chance of a link?

Do you think they would budge? Would I not be better simply offering the valuation price or is that silly?

Here is the house for anyone interested: http://www.rightmove.co.uk/property-for-sale/property-48253638.html

Not many pictures but it seems in average-good condition with only bigger jobs being in the kitchen which needs replacing, back reception room which needs floor relevelling, and the garden which needs a good tidy. Other than that it is mainly cosmetic upgrades. Has new boiler too.

buggy_boy

Crashy_Time wrote: »

Without a cash buyer who doesn`t care about wasting money the seller is snookered, offer them 100k or walk away IMO. Any chance of a link?

Ignore this idiot. It sounds like you think the valuation is wrong, if your happy to proceed then do so, I would suggest trying to lower the price though, maybe meet in the middle somewhere..

The big thing is how much of a deposit you have, basically anything you offer over the valuation will not be counted as part of the deposit.. So for example if you end up paying say 110k, and the mortgage product requires 10% deposit then if the property was valued at 110k you would need a deposit of 11k, as the property is only valued at 105k you would need 10.5k to meet the 10% plus the 5k difference so 15.5k

Remember the valuation is not a definitive value of the property, different mortgage companies can have different risk factors so can have slightly different valuations for the same property, remember if you default and the mortgage company need to dispose of the property they will want to do it fast, this would obviously lower the valuation.

goodallish

buggy_boy wrote: »

Ignore this idiot. It sounds like you think the valuation is wrong, if your happy to proceed then do so, I would suggest trying to lower the price though, maybe meet in the middle somewhere..

The big thing is how much of a deposit you have, basically anything you offer over the valuation will not be counted as part of the deposit.. So for example if you end up paying say 110k, and the mortgage product requires 10% deposit then if the property was valued at 110k you would need a deposit of 11k, as the property is only valued at 105k you would need 10.5k to meet the 10% plus the 5k difference so 15.5k

Remember the valuation is not a definitive value of the property, different mortgage companies can have different risk factors so can have slightly different valuations for the same property, remember if you default and the mortgage company need to dispose of the property they will want to do it fast, this would obviously lower the valuation.

I understand that the valuation doesn't give an exact value and could be way out compared to how someone else may value it, but it's out me in this situation now which is not really where I expected, nor want to be in.

I'm looking at a 90% LTV and don't have anything extra to add to the price so finding the extra £11k as it stands at the moment won't happen. To be honest, I couldn't really afford to find anything extra even if the price was renegotiated to somewhere in between so I'm not in a position to do that. My only options, as far as I can see, at the moment are to lower to the valuation price and hope for the best or walk away leaving the offer on the table if they won't budge :undecided

Edit: After some quick calculations, it looks like I could push a little higher than the valuation price. I'll have to wait until I get the official offer back from the bank (this week hopefully) and then decide what I want to do before approaching the estate agent.