Told I have to complete within 3 months of valuation !

mooshy

Hi
So in 2003 I bought my house with the old home it scheme . It was good deal and the HA paid 25% of the purchase price . We put 10% down and the other 65%was mortgaged .
10 or so years later I bought my ex husband out and discovered the old HA who did the scheme no longer existed and it took me a long time to track down who did .
It took me even longer to sort out my purchase of my ex share as they had limited knowledge of the old home buy scheme .
I am freehold and do own my home outright although my understanding is that the HA has a 25 % charge on the property .
So I now want to sell .
The letterthey have given me says the following :
To set the price of the share an independent valuer must be arranged . You will be responsible for the cost of the valuation whether the sale proceeds or not .
The valuer must disregard any improvements you have made .
When we receive the valuation we will send you a copy so you can decide whether to proceed.
Now here’s the bit I’m really worried about ....
If you decide to proceed with the sale you must notify us in writing and must complete within 3 months of the date of the valuation report .
If the purchase is not completed within 3 months a new valuation will be required and a fee may be charged for the new valuation .
May I also advise that a new valuation may substantially affect the price you pay for the purchase of the share .

Surely this means I have to sell immediately as the sale will take around 8 weeks to complete ? That gives me almost no time to sell ?
I’m all for selling quickly but basically I need to have already found a buyer before I put my house on the market .
Any advise would be most welcome please .
Thank you

davidmcn

Surely you just wait until you've got a buyer before going ahead with the valuation? Or am I missing something?

mooshy

Omg of course !
Seriously I never thought of that .
Just had the estate agent here too and neither did he ��
Thank you .

[Deleted User]

You can't wait for a buyer until you get the valuation as the numbers might not add up. As an example on a clients recent shared equity sale:

Puts property on for £250k as per estate agent advice
Sits on market a month and a buyer comes along and agrees to pay £242,000
RICS surveyor goes out on behalf of Housing Association and says its probably worth £250,000

Property owner now has to pay £10k of his own money to sell as the HA want the value based on RICS surveyor.

These schemes might vary depending on who is running them but this particular one the HA wanted their money based on valuation , not sale price

mooshy

Yes my HA want their money based on independent valuation minus any improvements .
I’m okay as I’ve had the house 15 years and added an extra bedroom .
Whatever it sells for my payout to the HA will be based on the independent valuation of my property disregarding improvements.
Does that make sense ?

davidmcn

At worst it just means you need to get the valuation updated? Other then the fee it shouldn't be an issue unless something sudden and dramatic has happened to property prices - in which case you (or the buyer) may want to reconsider the price anyway.

eddddy

Deleted_User wrote: »

Puts property on for £250k as per estate agent advice
Sits on market a month and a buyer comes along and agrees to pay £242,000
RICS surveyor goes out on behalf of Housing Association and says its probably worth £250,000

How would the seller have been better off by getting a valuation before putting it on the market?

If £242k was the best offer the property was going to get, the seller has to either swallow the £10k loss, or not sell.

(But maybe the seller needs to agree with the EA that if they pull out of the sale due to a low valuation, no EAs fee is payable.)


More importantly, did your client show documentary evidence to the RICS valuer that the property had been on the market for 2 months, and the best offer was £242k before the valuer prepared the valuation report? (And not after the valuation report was prepared.)


Edit to add...

I wouldn't be too surprised if the RICS valuer checked Rightmove and saw the property listed at £250k and marked SSTC, and used that as the basis of their valuation.

xoAmyox

When you speak to potential surveyors, ask their approach to this. It won't be the first time they have worked with a HA deadline.

In my experience, some are willing to do a 'desktop' extension to a valuation after 3 or 4 months for a further 3 or 4 months. Some will charge for this, and some will not.

Tiglet2

Unfortunately it is often the Help to Buy Agent (i.e. Target) who charge a £200 admin fee to send out paperwork to the solicitor acting on a sale and they are unlikely to waive this fee. I have just had to ask a client to pay this fee for a second valuation as their buyer's solicitor has raised lots of enquiries and the three month deadline is not going to be met.

My advice would be not to get the RICS valuation done until you have a buyer, have instructed a solicitor and sent back all the initial paperwork that the solicitor requires (together with any monies on account) in order that they can start the work and issue the draft contract paperwork to the buyer's solicitor. Once the buyer's solicitor has approved the contract and raised their initial enquiries, you can apply for the RICS Valuation and get the ball rolling with the Help to Buy Agent. You will know when this is because some of those enquiries will come to you as the homeowner.