Down Valuation

TomJenkins1

So we have accepted a offer on our house and have bought another one. The vendors bank sent out a surveyor and they have down valued our house by £10k...great. So now our buyers have a £10k shortfall we have agreed to reduce it by 5k to meet them in the middle. My question is can my buyer make up the shortfall in cash ? Does this effect land registry? because the bank are only willing to lend her the amount they have valued at where can the extra cash come from.
I just don’t understand the reasoning our agreed price was spot on and is inline with the current local market.
Are these lenders and surveyors creating a crisis that doesn’t exist ? They have my buyers by the balls unable to change lender. e.surv and Lloyd’s in it together.
One thing on e.surv terrible customer service and a valuation that lasted no more the a couple of minutes with a chap from over 50 miles away. Awful.
Something is valued at what someone is willing to pay simple as that.

lookstraightahead

But the person paying is the bank. And I would say houses are going down in value. How long was it on the market for?

lookstraightahead

Yes they can make it up in cash I'm sure, if they really want to.

TomJenkins1

Thanks for the replies it was on the market for 12 days. I understand it’s the bank that is paying I had the house valued by three estate agents and a surveyor before we put it up for sale. It just seems so subjective, another surveyor on another day would we be having this conversation.

justjohn

Out of interest were both surveyors RICS certified?
And are the buyers paying under the original valuation?

TomJenkins1

Bit of background I live in Wales and I know that on average RICS are attributing this poorest result in 20 years to growing worries and uncertainty over Brexit and the resulting effect of leaving the EU on the national economy.
But in comparison, only 6% of Wales-based RIC members are expecting the next three months to experience a drastic fall within the Welsh market.
In fact, new instructions to sell increased by 9% suggesting that the number of new properties in Wales coming onto the market was higher in December than in November 2018, bucking the national trend of a decline in 19 of the previous 24 months.

TomJenkins1

Yes both were members of RICS and the buyer is paying just under valuation

lookstraightahead

But (and I'm playing devils advocate a bit) they will be looking more long term and the Market is fickle. I bought a house when banks were splashing the cash and ended up in negative equity (long time ago now).

justjohn

TomJenkins1 wrote: »

Yes both were members of RICS and the buyer is paying just under valuation

lol
ok i sold a house, valuation 175k and buyer paid 155k. Second valuation came out at 165K and it was the same original surveyor The property was valued at 175k When i bought it 4 years previous.


i did not compensate the buyer due to renewed valuation.


i think it is common practice for them to alter the valuation for properties were buyer is paying less than the valuation.

TomJenkins1

Thanks for all the replies so far. So I think and it’s a big think that they are on a 100% mortgage if this is the case and their family make up the short fall (5k in this case) is this allowed/legal ?

AnotherJoe

TomJenkins1 wrote: »

So we have accepted a offer on our house and have bought another one. The vendors bank sent out a surveyor and they have down valued our house by £10k...great. So now our buyers have a £10k shortfall we have agreed to reduce it by 5k to meet them in the middle. My question is can my buyer make up the shortfall in cash ?

Of course
Does this effect land registry?

Land registry merely note what it was sold for.
because the bank are only willing to lend her the amount they have valued at where can the extra cash come from.

The buyer

I just don’t understand the reasoning our agreed price was spot on and is inline with the current local market.

The lender/surveyor disagree with you.

Are these lenders and surveyors creating a crisis that doesn’t exist ? They have my buyers by the balls unable to change lender. e.surv and Lloyd’s in it together.

One thing on e.surv terrible customer service and a valuation that lasted no more the a couple of minutes with a chap from over 50 miles away. Awful.
Something is valued at what someone is willing to pay simple as that.

Incorrect. A house is valued at what the company lending the money to buy the house value it for not some naive buyer with little of their money on the line.