Natwest huge house undervaluation - what is happening?

jamielutz1987

yessuz said:

I got valuation with HSBC, with different valuator.
New valuation came even less than NATWEST.
I mean there are no such prices in our town as the valuars putting in these valuations. not for the last year or so. it is sad and crazy

@yessuz Sorry to hear this but it's probably time to walk away from this transaction.

Alternatively, you can have a frank conversation with the EA citing the two valuations (in your place I would share the two valuations with the EA so they know you're not just trying it on) and giving a final max price that you can possibly pay. If two different valuers from two mainstream lenders have valued it at no more than 270k, lots of other potential buyers are going to come up against the same roadblock.

If the vendor needs to sell, they may consider a lower offer, but if not they may just decide to hold on, wait and see. No harm in asking.

Good luck and if this doesn't work out, hope you find a different property soon!

yessuz

yes, at this moment we are gathering some bridging funds, smashing all the piggy banks and such and will try to take the mortgage on 270 valuation.

[Deleted User]

Brock_and_Roll said:

Despite all the alogrithms, spreadsheets and databases of sold prices, markets are ultimately moved by sentiment. As a banker myself of 30+ years I have been through many ups and downs - the booms when the sales guys are riding high and spreadsheets are "tinkered with" to fit the optimistic FOMO mantra..... and the downturns when the credit & risk guys regain control with their "difficult" questions! 

As the moment I can tell you that the sentiment is very nervous - "everyone" is expecting a downturn as unemployment kicks in and all this debt the country has taken on starts feeding through to tax rises and/or services cuts.  A survey of just a handful of the UK's largest business last month said they expected to cut over 100,000 jobs and I am afraid the picture nationwide will be much higher. I am also expecting some very large and high profile insolvencies. This sentiment seeps through organisations and starts to become an accepted inevitability and a self fulfilling prophecy - this in turn feeds through to lending policies and the discussions lenders have with partners such as surveyors......

......a house is worth what someone is wiling to pay for it (and a lender lend against!)

Excellent post and precisely my own views too - i'm not in banking but am in the real world !

When i've commented on posts in this subforum i always allude to this very thing, i think people are forgetting the extreme nervousness of our economic climate and haven't yet realised it - especially those in the OP's et al situation. 
Bad times are staring us, angrily, in the face 😯

blue_max_3

I am quite heartened by this trend. It's about the only thing that can put downward pressure on house prices. It may even avoid a crash if prices were moderately reduced, but still in demand. Ultimately, it is helping buyers by more responsible lending.