Help! Property valued 50k less than offer!!

AdrianC

Lover_of_Lycra said:

@AdrianC, would you seriously continue the purchase of a property at the original offer price when the mortgage valuation came in at £50k less

As a generality? I can certainly see situations where I would, yes.

based on recent sold prices of two much more desirable properties?

If the house was priced that far above the market, why did the OP make that offer in the first place?
Would it not be obvious to a reasonable layman that market value was below that price?
Was the valuation simply a desktop survey?

I don't think we have anywhere near enough information to make an informed judgement of whether the OP's offer or the surveyor's valuation is more likely to be correct - so all we can do is advise on whether the situation is solvable. I'm assuming the vendor is unlikely to simply roll over and take a £50k reduction in offer...

numbercruncher8

Without more information I don't see how anybody can conclude anything.
But houses on the same street selling for less very recently is a bad sign.

Its entirely possible for someone to make a bid based on incomplete information, also egged on by the EA (6 offers might be an untruth), and also emotional attachment.

I think it's a bit irrelevant now to ask 'why did you make that offer in the first place'. When more information becomes available, why shouldn't your opinion change? 

AdrianC

numbercruncher8 said:

Its entirely possible for someone to make a bid based on incomplete information, also egged on by the EA (6 offers might be an untruth)

Whether it is or not is beside the point.

Who would continue to raise their offer £50k over what they thought was a reasonable amount, simply because of a claim that others were happy to offer that?

At some stage, wouldn't most reasonable people say "Woah, sod this. If they want it that badly, they can have it."?

When more information becomes available, why shouldn't your opinion change?

Apart from one surveyor's opinion has been ventured, what's changed?

Since when were surveyors infallible, especially in desktop valuations?

GDB2222

@AdrianC Yes it’s a theoretical possibility that the surveyor is wrong, but the 12% difference is more than the usual margin for error. I’d back the professional's judgement unless the OP gave good grounds for believing the surveyor had made a major blunder.

As Rosa says, the OP may need to spend more time researching sold prices before making a bid. Otherwise, he is putty in the estate agent’s hands.

numbercruncher8

Are similar sales in the same road not relevant any more?

I didn't say surveyors were infallible, I just said that when more information becomes available why shouldn't your opinion change?

If a trained professional isn't infallible and could be wrong on the valuation, isn't it just as likely or more that an untrained viewer may have made an error on the price?

prowla

So, the valuer, whom you have asked to lend you money and is working on your behalf said it's overpriced by 50k.

Why would you be thinking of donating that extra 50k to the seller?

AdrianC

numbercruncher8 said:

Are similar sales in the same road not relevant any more?

How similar are they? We don't know.

I just said that when more information becomes available why shouldn't your opinion change?

Indeed. Do we have enough information to say either way? No.

If a trained professional isn't infallible and could be wrong on the valuation, isn't it just as likely or more that an untrained viewer may have made an error on the price?

Absolutely. But we don't have enough information to know which of the two...

About all we know is that one of the two has definitely been to the property.

numbercruncher8

So basically we are in agreement: we need more information to really say either way.

I'm just offering an opinion - on what I have read so far it is more likely than not to be not in the buyers interest. I could be wrong if more information comes out, but then with more information my opinion could change.

'More likely than not' doesn't equate to 'is going to be'; of course there may be scenarios where paying much over the valuation could still be fine. But again, there is not enough information to say whether that could be the case. 

AdrianC

numbercruncher8 said:

So basically we are in agreement: we need more information to really say either way.

That is all I've said all along...

[Deleted User]

AdrianC said:

Lover_of_Lycra said:

@AdrianC, would you seriously continue the purchase of a property at the original offer price when the mortgage valuation came in at £50k less

As a generality? I can certainly see situations where I would, yes.

based on recent sold prices of two much more desirable properties?

If the house was priced that far above the market, why did the OP make that offer in the first place?
Would it not be obvious to a reasonable layman that market value was below that price?
Was the valuation simply a desktop survey?

I don't think we have anywhere near enough information to make an informed judgement of whether the OP's offer or the surveyor's valuation is more likely to be correct - so all we can do is advise on whether the situation is solvable. I'm assuming the vendor is unlikely to simply roll over and take a £50k reduction in offer...

The vendor probably won’t roll over and take a £50k reduction in offer but that doesn’t mean the OP should more for a terraced property with a recent history of subsidence than two semi detached properties on the same street sold for recently and £50k above the mortgage valuation. 

We have also been told the property was on for the same price 2 years ago and didn’t sell. 

Maybe that wouldn’t be enough to put you off and that you’d be juggling your finances to make up the £50k shortfall as you’ve suggested to the OP but for me there are too many red flags and I’d start looking elsewhere.