Property valuation 7% lower than accepted offer

RonSwanson

Hello.

I'm a first time buyer and I have an offer of 140k accepted on a flat in a popular area. I've just received the property survey which has valued the property at 130k. It doesn't list any major problems with the property, so I'm assuming the seller has just overvalued the property?

Should I negotiate with the seller to get the valuation price? Not really sure where to go from here.

letitbe90

You could try negotiate - they could just respond by saying that a survey can be 10% above or below the actual value (which would probably be written in the report itself?).

davidmcn

letitbe90 wrote: »

You could try negotiate - they could just respond by saying that a survey can be 10% above or below the actual value (which would probably be written in the report itself?).

Standard margin of error is more like +/- 5% (and I can't remember ever seeing it actually stated in a valuation). 10% for newbuilds perhaps.

If it's a popular area then maybe buyers are willing to pay over the odds? (on the basis that prices are rising faster than can be evidenced from completed sales).

letitbe90

davidmcn wrote: »

Standard margin of error is more like +/- 5% (and I can't remember ever seeing it actually stated in a valuation). 10% for newbuilds perhaps.

If it's a popular area then maybe buyers are willing to pay over the odds? (on the basis that prices are rising faster than can be evidenced from completed sales).

I thought they would have stated in the valuation to avoid litigation - I think you might be right that for normal residential properties, the general accepted margin of error is +5/-5% (which is a range of 10%, which is probably what I was thinking).

eddddy

RonSwanson wrote: »

Should I negotiate with the seller to get the valuation price? Not really sure where to go from here.

You can certainly try that approach. Some sellers might agree to drop the price (maybe meet you in the middle), but some might not.

Your mortgage lender will lend less on a property that they've valued at £130k than one they've valued at £140k. If the seller won't budge on price, can you still afford the property?

RonSwanson wrote: »

...so I'm assuming the seller has just overvalued the property?

Not really. It's probably more accurate to say that the property was worth £140k to you, so that's what you offered.

Crashy_Time

https://www.homesandproperty.co.uk/property-news/london-house-prices-falling-at-fastest-rate-in-almost-a-decade-but-theyre-still-50-per-cent-higher-a121716.html

brit1234

Lots of areas are now falling in price. I would try and haggle down based on the report, also informer the seller that they will most likely be able to buy their next property cheaper as well.

_CC_

Crashy_Time wrote: »

https://www.homesandproperty.co.uk/property-news/london-house-prices-falling-at-fastest-rate-in-almost-a-decade-but-theyre-still-50-per-cent-higher-a121716.html

"London is the only region where house prices are falling and experts still forecast a correction rather than a crash."


Is the OP's £130k flat in London I wonder?

letitbe90

_CC_ wrote: »

"London is the only region where house prices are falling and experts still forecast a correction rather than a crash."


Is the OP's £130k flat in London I wonder?

A 2m x 2m shed in a bushy garden can be a flat in London, so you never know . Although, that would probably be priced north of 150k!

ThePants999

_CC_ wrote: »

Is the OP's £130k flat in London I wonder?

Is there such a thing as a £130K flat in London?

_CC_

ThePants999 wrote: »

Is there such a thing as a £130K flat in London?

CrashyClown linked to an article primarily about London properties so maybe he knows something about the OP's location which we don't.