Re-evaluation after mortgage offer in place?

idana20

Newbie here so please forgive me if not entirely clear. I am a first time buyer unable to sleep with worry... about everything but in particular about this.
I am buying a leasehold flat and I have a mortgage offer in place, but my broker says lender will want to value property again because of property market dive? Online valuation of the property is suggesting the price has dropped since the last physical valuation was done 3 months ago, so will the surveyor use this as an indicator for lowering value now or will they just go by their previous valuation? Are they likely to do physical valuation? Was anyone else in the similar situation with the lender? I understand they want to protect themselves and I wouldn't mind paying less money for the property, but not sure how much to trust this online estimate, especially if this new valuation is going to delay everything, as many posts here are suggesting quite a backlog with valuations?
I would really appreciate any info on these issues, especially from all the surveyors/lenders/brokers.
Thank you 

Home2011

When you say online valuation of the property is showing price has dropped, which online valuation and by how much?
We are in a similar predicament as the property we are buying also dropped in value :-0

idana20

Sorry, the notification about your post went into spam and I'm still trying to figure my way around. The online valuation is from the Mouseprice website. I was told they are very accurate, but it would be great to hear the expert opinion. Not sure why my question hasn't had any other replies? Maybe I am doing something wrong :-(

davidmcn

idana20 said:

Not sure why my question hasn't had any other replies? 

I was going to ask the same question, so waiting for you to answer.

Mouseprice (and similar sites) are just applying extremely general indexation for vast regions to sold house prices, they don't know anything in particular about your house, street or even town. It's not a means of assessing what (if anything) has happened to the value of this property in the past three months.

If you want to know about your lender's practices you'll need to tell us who they are.

idana20

Are you sure?

If mouseprice don't know anything about this property why was its value 3 months ago, when the valuation was done, identical to that valuation even though the other properties in the block had different value? These values have since all gone down as well but they remain different to this particular flat. 

I would think that suggests a link between recent valuations and the figures used on the website. 

Mouseprice also has downloadable EPC for the property, again identical to the one we got from the seller.
And what about the valuation report you can get when you have paid subscription. Would people subscribe to this if tonally worthless?

If Mouseprice and alike don't hold any factual data where do you suggest we look apart from sold prices data?
Thanks

davidmcn

idana20 said:

I would think that suggests a link between recent valuations and the figures used on the website. 

How would there be? There's no central database of valuations that surveyors are reporting back to. Valuations are confidential to whoever instructed them.

Mouseprice also has downloadable EPC for the property, again identical to the one we got from the seller.

EPCs are publicly accessible, you can get them elsewhere too.

And what about the valuation report you can get when you have paid subscription. Would people subscribe to this if tonally worthless?

Probably. Some people are gullible.

If Mouseprice and alike don't hold any factual data where do you suggest we look apart from sold prices data?

The prices of completed sales are the only factual data. That's what surveyors base their valuations on. The valuation will only change if there is evidence of different prices being achieved recently by comparable properties.

idana20

Our mortgage offer is from Nationwide, but our broker said he also had requests for the new valuations from other lenders including Natwest, Barclays and Santander. 

What is your affiliation to property business?  Are you a mortgage broker?

davidmcn

idana20 said:

 Are you a mortgage broker?

I'm a solicitor.

Thrugelmir

Definitive sales values are obtained from the Land Registry. This information is only ever historic and lags current events. Surveyors will speak to estate agents in the locality and monitor current accepted offer prices. When evaluating whether a price offered is deemed reasonable for the underlying security. 

idana20

davidmcn said::

The prices of completed sales are the only factual data. That's what surveyors base their valuations on. The valuation will only change if there is evidence of different prices being achieved recently by comparable properties.

Thank you.
Yes, that is the only truly factual data, but if there aren't any recent sales what data is there to be used by surveyors? 
Are you saying that the current state of the economy, all the predictions by the property experts are totally ignored by the surveyors? 

Also why are all these lenders asking for the new valuations If the surveyors are going to just stick with those pre Covid vales?

Sorry about all the questions, I am just trying to digest fully your answers

davidmcn

idana20 said:

davidmcn said::

The prices of completed sales are the only factual data. That's what surveyors base their valuations on. The valuation will only change if there is evidence of different prices being achieved recently by comparable properties.

Yes, that is the only truly factual data, but if there aren't any recent sales what data is there to be used by surveyors? 
Are you saying that the current state of the economy, all the predictions by the property experts are totally ignored by the surveyors? 

Also why are all these lenders asking for the new valuations If the surveyors are going to just stick with those pre Covid vales?

Then they'll go further afield if they need to for comparables, and add caveats about the state of the market and the resulting uncertainty about the accuracy of any valuations at the moment (because so many transactions are on hold, so goodness knows if/when they'll actually complete and at what prices).