Surveyor Undervalue Property

G_Day

Hi,
I have recently had a sale price agreed for my property and when they did the survey for the mortgage the surveyor under valued it by £15k under the agreed price. The estate agent is trying to appeal this, however the surveyor said the reason is because of an extension at the back of the house that under new regulations isn't recognised.

When I bought the property 5 years ago, the previous owners had moved the bathroom downstairs off the kitchen and added an extension for this. This way they got two double bedrooms. I moved it back upstairs and extended the kitchen. Now the surveyor is saying that this extension cant be recognised and as such the house isn't worth the value.

The estate agent is sending properties that show even with.or without the extension my house is worth a lot more than what he is saying just looking at the condition of other houses that have been sold nearby compared to mine. I'm a little taken aback because it seems quite random and I never had the issue when I purchased the property.

Anyone come across this or have any advice?
Thanks

muhandis

Is there any more detail on why they won't "recognise" the extension?

One common reason is it being a 'single brick' or 'single skin' extension when in many cases the valuation is reduced to reflect the single brick extension – effectively valuing the property as if the extension was not there.

G_Day wrote: »

Hi,
owever the surveyor said the reason is because of an extension at the back of the house that under new regulations isn't recognised.

[Deleted User]

The surveyor hasnt undervalued the property.
They have given a figure to the lender that they feel more accurately represents the value of your property.

If I was the buyer I dont know why i would be listening to your estate agent (who is effectively a salesperson) try to correct a qualified surveyor.
I would either be asking for 15k off the asking price or walking away and buying something that isnt 15k overpriced

There is a difference between the surveyor undervaluing your house, and you selling it for more than it is valued at

phill99

The estate agent has over valued the property

diggingdude

another vote in the surveyor's corner here. You could commission your own Rics survey and see what happens?

G_Day

Thanks all but I dont believe that the estate agent over valued it. They base their valuation on what other houses have gone for in the area and based on other sales my house is in far better shape without or without the extension. Which is why I am a bit confused by the reason.

@muhandis I'm not entirely sure of the construction of the extension. I was wondering if it was such an issue why it wasnt flagged when I bought the property, which wasnt that long ago. What law could have possibly changed? According to the estate agent it's because of some new regulation. He hasn't given me more than that whilst he goes back to the surveyor.

[Deleted User]

To give you an idea of how little the actions being taken are going to help.

A valuation appeal is not done by the estate agent contacting the surveyor. A valuation appeal it done by a buyer (or their mortgage broker) contacting the lender who will contact the surveyor. They need 2 or 3 recently completed properties of the exact same type to give new comparables. If the surveyor then comes back and says 'yeah i did see those already' then nothing will happen.

Again, I ask the question. Why would your buyer want your estate agent to get the surveyor to increase the price? All the action being taken is in your interest but doesn't serve the buyer or the mortgage lender at all.

Nothing is going to change from this and the estate agent is wasting time. There is a deadline on actual valuation appeals being submitted by the buyer. If the estate agent spends the next week going down this pointless path and the buyer actually wants to appeal the decision (for some unknown reason) then he/she may not be able to do so because time has run out

What does the buyer think about the valuation? because that it is the only opinion that matters here

csgohan4

G_Day wrote: »

Thanks all but I dont believe that the estate agent over valued it. They base their valuation on what other houses have gone for in the area and based on other sales my house is in far better shape without or without the extension. Which is why I am a bit confused by the reason.

@muhandis I'm not entirely sure of the construction of the extension. I was wondering if it was such an issue why it wasnt flagged when I bought the property, which wasnt that long ago. What law could have possibly changed? According to the estate agent it's because of some new regulation. He hasn't given me more than that whilst he goes back to the surveyor.

EA are not RICS accredited and therefore what they value your house is to try and get business to go with them.

IF you believe your EA over a RICS Valuation, clearly it is over priced.

muhandis

Apparently, lenders have become significantly more conservative on lending where single-skin construction comes into play, in recent years. See here for more details https://www.ft.com/content/411878ca-76a4-11e2-ac91-00144feabdc0

As the article says, different lenders view it differently but unfortunately, as a vendor there is only so much you can influence the choice of lender.

In your place, I would do my best to find out what the exact issue is which led the surveyor to not 'recognise' the extension. Did you get to see the actual valuation report to see what it says?

G_Day wrote: »

@muhandis I'm not entirely sure of the construction of the extension. I was wondering if it was such an issue why it wasnt flagged when I bought the property, which wasnt that long ago. What law could have possibly changed? According to the estate agent it's because of some new regulation. He hasn't given me more than that whilst he goes back to the surveyor.

G_Day

muhandis wrote: »

Apparently, lenders have become significantly more conservative on lending where single-skin construction comes into play, in recent years. See here for more details

As the article says, different lenders view it differently but unfortunately, as a vendor there is only so much you can influence the choice of lender.

In your place, I would do my best to find out what the exact issue is which led the surveyor to not 'recognise' the extension. Did you get to see the actual valuation report to see what it says?

Thank you, this is really helpful. I haven't seen the report yet as I was only told this yesterday but I will ask for it.

I just want to clarify that I am not believing the EA out of some silly notion of what my house is worth. I see the houses that are going on sale in my area and even one in my very close. Same size but they do not have the extension and in a slightly less better condition than mine. The sale has been agreed at around my same asking price. I'm sure they also had a valuation done, therefore agreed at that price.

The buyers are disappointed because they also see the houses that are going on sale and the asking prices and the condition they are in. They believe they got a deal with mine and I was happy to accept because I have also found my onward purchase. The whole thing is just a little confusing and frustrating.

I will get the report and see what it says. I didn't know buyers could appeal, but I presume that usually goes the other direction.

Thank you all for your input.

muhandis

If possible, do update the thread once there are any developments. These MSE forum threads serve as an invaluable resource for someone else who might encounter a similar situation in the future.

Good luck, hope you're able to find a buyer at a decent price!

G_Day wrote: »

I haven't seen the report yet as I was only told this yesterday but I will ask for it.

I will get the report and see what it says.