Peculiar Valuation Situation

purt

Hi everyone,

I'm in the process of selling my flat and buying an onward purchase. Everything seems to be going smoothly with my buyer's mortgage etc, but I've come up against an issue with the flat I'm trying to buy.

I've used a broker, had my mortgage application approved and the valuation commissioned. The valuation was supposedly a desktop valuation. Two weeks on from when the valuation had been scheduled, the lender came back to say they couldn't lend on it because of "limited marketability and saleability". It's most peculiar. There appears to have been some issue with the surveyor. According to the broker, the surveyor reported not being able to access the property (yet it was - according to the broker - a desktop valuation) and initially a zero valuation. The broker also reports that the surveyor did suggest there were comparable sales on which to base a valuation, then finally it came back that the lender couldn't lend on it. I've not had a value, or seen anything in writing other than what the broker has told me by email.

Is this type of situation common? It feels odd to report limited marketability/saleability on a property they seemingly haven't been anywhere near. The flat is a little on the small side, but it's about the same size as most studio/one bed flats and bigger than the studio flat I'm selling. It's in a rather quiet and leafy street in South West London. It's standard construction and in a quaint little brick development. The current owner also has a mortgage on it and lives in it. The lender has no specific criteria on minimum size of property, treating each on merit and the valuer's comments. 

My broker has said they will try to find out more and I believe I can appeal, but I doubt it will have much effect on the outcome. I'm wondering if I should abandon the purchase altogether and look for something different, or try a different lender that doesn't use the same surveyors and hope for a better outcome. 

Views welcome.

LRmortgage

Is it a studio or a 1 bed flat? 

If it’s a studio, whilst the lender may not have a minimum property size, they will leave it to the discretion of the valuer as whether s/he believe their will be future appetite / saleability. 

Sounds to me like the valuer doesn’t think it’s a good buy. 

You could ask your broker to try a different lender who use a different surveying panel. 

purt

Thanks. It's a small one bed teetering on the 30 sq. metres mark (which I know some lenders don't like). 

LRmortgage

I’d suggest that is probably your issue. As mentioned before, worth looking at a different lender who use a different panel of surveyors for another try. 

purt

Thanks. That's my plan.

Forgive my ignorance, but if it's a desktop valuation how would they know the size of the property? And equally, is it not odd that they haven't (in so far as I can tell, though the broker is checking) provided an actual value of what they think it might be worth?