Valuation Worries

chocfudge84

We’ve had an offer accepted on a house and HSBC are doing a desktop valuation next week.

I don’t know if I’m worrying about nothing but am becoming increasingly anxious about the house being valued at less than we’ve bought it for as I keep reading that this is happening more often due to Covid.

The house we’re buying is owned by a builder who has completely transformed it- he’s done a gorgeous job and it’s a beautiful house.
It’s in the market for £395000 and we’ve bought it for £385000. He only paid £200000 for it but bought it as a tiny 3 bed and had extended it into a very large 4 bed.
The problem is, no other house in the street has sold for anywhere near this. Next door sold at the end of last year for £300000. This one was 5 bed and ours is 4. However, next door is nowhere near as modernised as the one we’re buying. I’m Worried that as it’s potentially a ‘one off’ and different from anything else in the street, it’ll be valued lower and we don’t be able to afford it as we can’t increase our deposit anymore if the bank will offer a lower mortgage. 

Has anyone had a house valued by HSBC recently?

Michael_Bear

Just to confirm your sure it's worth £385k?
Next door has more bedrooms and sold for £85k less.
My my calculations yours is worth 300k plus modernisation minus extra value from an extra bedroom. 

In all honestly if you threw 50k at next doors could you make it as nice as the one you've bidded on?

chocfudge84

I wouldn’t be able to say 100% how much it’s worth. We love it though and it would be our forever home so I’m not too worried about negative equity as would hope in 30+ years it would be worry more than we paid.
I’ve just double checked and it was 2019 that next door was sold. Not sure how much house prices have risen since then though?! 

davidmcn

chocfudge84 said:

I wouldn’t be able to say 100% how much it’s worth.

Well, obviously something made you think it's worth £385k. What evidence did you base that on?

chocfudge84

Others in the area (although not the same street- probably within 1 mile radius) are advertised for a similar price, although they would need modernising. There aren't many though- perhaps 2 or 3. Nothing in the street has sold since 2019 and they haven’t been modernised to the standard this one has. 

davidmcn

Surveyors work on completed sale prices, not asking prices - so what have the comparable properties actually sold for?

yllop1101

They will look at the house listing I imagine so that they can see the inside too.
I had similar worries about a victorian terraced house which had been renovated by the owner, also a builder, and was for sale for about 80k more than any others had sold for but none of those had been renovated. I was buying it for 307k, it was brought for £115k in 2015. The desktop valuation came back fine, and that was with an 85% mortgage. I didn't buy it in the end for other reasons, but, the valuation wasn't an issue Good luck with yours. 

chocfudge84

yllop1101 said:

They will look at the house listing I
imagine so that they can see the inside too.
I had similar worries about a victorian terraced house which had been renovated by the owner, also a builder, and was for sale for about 80k more than any others had sold for but none of those had been renovated. I was buying it for 307k, it was brought for £115k in 2015. The desktop valuation came back fine, and that was with an 85% mortgage. I didn't buy it in the end for other reasons, but, the valuation wasn't an issue Good luck with yours. 

Thanks for that! That’s really reassuring!