Part-Ex Valuation sucks

ayjax

Hi all,

We are currently selling our house to buy a new build in North East Wales. We decided to go down the Part-Ex route but are feeling upset by their offer. The house builders appointed 2 valuations to come around and give them an estimate of the houses value.

Whilst waiting for them to get back to us with an offer we also got our own Estate Agents around to value the house. We was told by these valuations it was worth between 115k and 117.5k for a quick sale. We thought this was fair compared to other properties for sale in the area.

The offer came back today from the builders and it was only 90k. This is 25k less than our lowest valuation. Now I realise that they might offer around 10% less than the market value but 25k is a massive chunk of money.

Does this sound about right for a part-ex valuation offer? If not then is their anything we can do about it?

Many Thanks

Adrian and Jennie

dimbo61

Put the property on the market and sell for more than £90,000

daz_79

Part ex offers are nearly always lower than market value as the developer normally pays the legal fees and then would normally want to sell the property ASAP, which would normally mean marketing at below market value. We are currently buying a new build and when we looked into PX they did say it would be upto 15 below market value (it has been valued by 3 EA!!!8217;s). After 3 months of trying to sell our house at full price ourselves the developer were desperate for us to buy their house we wanted and got to the point where they said name your price for PX and we!!!8217;ll come to some arrangement. I guess once their properties don!!!8217;t sell and they know someone wants it but can!!!8217;t sell their house their offer is dictated by their desperation. We couldn!!!8217;t use PX as using help to buy but in doing so were able to sell our house at 12k under original market price due to help from developer. In total we!!!8217;ve probably had the full 5% allowable incentives (13k) from the developers by way of legal, Estate agent fees, stamp duty and upgrades being paid for by them. My advice is to let them know you are interested, keep in touch with them and if the property doesn!!!8217;t sell they will likely become more accommodating. It worked for us. Good luck.

ayjax

Thanks for the response!

We are just miffed that its 25k below market value which is about 20% lower than what its worth!

We are going to try and push for Stamp Duty (5k), carpets and turf in the back garden (Yes this shocked me also that it doesnt come with any!)

Part of the complication is that Anwyl homes uses a 3rd party company for their Part-Ex which enables buyers to use the HelpToBuy scheme.

silvercar

Same as any other deal; you can accept, reject or negotiate.

ashe

ayjax wrote: »

Thanks for the response!

We are just miffed that its 25k below market value which is about 20% lower than what its worth!

We are going to try and push for Stamp Duty (5k), carpets and turf in the back garden (Yes this shocked me also that it doesnt come with any!)

Part of the complication is that Anwyl homes uses a 3rd party company for their Part-Ex which enables buyers to use the HelpToBuy scheme.

You're miffed its below EA valuation, but what are the actual sale prices for your street for homes of similar standard and decor? Quite often EA's will overvalue to get the business and then rely on the price dropping to get the actual sale. If their fee is fixed this doesn't even cost them anything. Our house sold for £12k less than the EA originally valued it, and I assume you don't have the stress of viewings, people dropping out, playing the waiting game or the cost of the EA fee to deal with when doing a part ex, so depends what you value all that at. if you feel you can achieve the EA price then crack on and do that - but definitely research what is realistic rather than taking the EA valuation at face value.

Mutton_Geoff

ayjax wrote: »

carpets and turf in the back garden (Yes this shocked me also that it doesnt come with any!)

I would get additional money off and buy something decent. The developer will throw in the cheapest contract carpet on the cheapest underlay which you'll be replacing two years down the line.


The cheap turf will go down with very little preparation so your lawn will be full of weeds, lumps and stones from the start. Again, get the money off and pay your own supplier for something decent.

AdrianC

The valuation figure is lovely - but you can't sell it for that, because nobody wants to buy it in the timescale you're after. What price would it sell for on the open market tomorrow?

Now look at the other costs that the developer is incurring in that PX transaction, and the £25k discount to your "valuation" starts to look reasonable. You are firmly at the lower end of house values - and that means that the fixed costs of the PX transaction translate to a much higher percentage.

Thrugelmir

ayjax wrote: »

turf in the back garden (Yes this shocked me also that it doesnt come with any!)

Wouldn't bother myself. As ideally the ground needs clearing of everything that's simply been covered over. Laying turf is easy to do.

PokerPlayer111

ashe wrote: »

Quite often EA's will overvalue to get the business and then rely on the price dropping to get the actual sale. .

This.

But also part ex valuations will be less than FMV no doubt.