Huge Down Valuation

tezzywezzy

Hi guys,

first post here and its a bit of a long one.

Somebody we work with was selling her house, she was close to contract with her buyers but they were messing her around with long delays selling their property, we then told her we were interested in buying her house (its gorgeous) and we offered her full asking price so that she would swap from her current buyers to us. which she did.

All was going brilliantly, we sold our house to a cash buyer and we were just waiting on our mortgage to be approved for her place and we were really excited. BUT Natwest have now downvalued the house by a whopping £29k (it was up for 249 and theyve come back with 220) Now, because we offered her full asking price we did have some money in the bank (£10k) set aside incase it was down valued... but its just been such a shock to have £29k knocked off the price. The house is a 6 bed, 5 bath, 3 story house... and in our eyes worth the full 249 and then some.

Having sat and worked out all our finances we would still be £8k short if we took out a 90% LTV mortgage with Natwest (they dont do 5% mortgages)

Its very unlikely we could get our friend to come down on the price as... tbh... we all KNOW the house is worth 249 and she did swap from her orginal buyers to us because we offered her full price.

My question is are we able to challenge Natwest at all on the serious down valuation? There are other properties in our area selling for the same price which are 4 bed 2 bath so im just so confused as to why this house inparticular was valued so low!

Any advice would be much appreciated, we are totally gutted about the whole situation.

K_S

@tezzywezzy When done through a broker, Natwest will accept a challenge only for the following reasons -

1)      Factual error on the valuation instruction (wrong address, wrong number of bedrooms, wrong description, etc).

2)      The property is a New Build and there are recent comparables on the same site.

It might be different direct, so perhaps worth giving Natwest a call to see what they say.

Thrugelmir

tezzywezzy said:

 The house is a 6 bed, 5 bath, 3 story house... and in our eyes worth the full 249 and then some.

Doesn't sound like a property that will have wide appeal. Is it an HMO? 

Pepod

Downvaluations seem to be pretty common at the minute, probably not helped by this bit of a boom we are having. I don't think you will have much luck appealing, but you could always try.

On the other hand - I would be tempted to speak to your friend about the 8k difference. Everyone might 'know' the house is worth £249k, but if it's being valued at £220k then other buyers are likely to have the same problem.

missile

If you really want to pay more than valuation, try a mortgage broker who might get a more sympathetic surveyor. 

tezzywezzy

Thrugelmir said:

tezzywezzy said:

 The house is a 6 bed, 5 bath, 3 story house... and in our eyes worth the full 249 and then some.

Doesn't sound like a property that will have wide appeal. Is it an HMO? 

No, its not an HMO its a single house

MoneyPenguin

I was recently successful contesting a 22k downvaluation. Get an estate agent to put together a local area report and submit that to the lender.

MWT

A 6 bed, 5 bath, 3 story house at that price is an unusual combination, are there any other properties nearby with that configuration?

A lack of comparable recent sales can lead to this sort of valuation problem and make it hard to contest.

It isn't enough to just point at 4 bed 2 bath properties as they are not really a comp[arable proposition as there is usually a solid market for that configuration but the one you want is somewhat unusual...

Has the property been considerably extended or was it originally built that way?

At first glance, it does sound like it is a converted B&B or guest house, has it ever been used for that purpose to your knowledge?

tezzywezzy

MWT said:

A 6 bed, 5 bath, 3 story house at that price is an unusual combination, are there any other properties nearby with that configuration?

A lack of comparable recent sales can lead to this sort of valuation problem and make it hard to contest.

It isn't enough to just point at 4 bed 2 bath properties as they are not really a comp[arable proposition as there is usually a solid market for that configuration but the one you want is somewhat unusual...

Has the property been considerably extended or was it originally built that way?

At first glance, it does sound like it is a converted B&B or guest house, has it ever been used for that purpose to your knowledge?

Yes, im under the impression that it used to be a guest house, and there are still sinks in every bedroom, but has been used as a normal house for its last 2 owners (dating back to the 90's)

tezzywezzy

MoneyPenguin said:

I was recently successful contesting a 22k downvaluation. Get an estate agent to put together a local area report and submit that to the lender.

Amazing news! Yes i will most certainly do that!

tezzywezzy

tezzywezzy said:

MWT said:

A 6 bed, 5 bath, 3 story house at that price is an unusual combination, are there any other properties nearby with that configuration?

A lack of comparable recent sales can lead to this sort of valuation problem and make it hard to contest.

It isn't enough to just point at 4 bed 2 bath properties as they are not really a comp[arable proposition as there is usually a solid market for that configuration but the one you want is somewhat unusual...

Has the property been considerably extended or was it originally built that way?

At first glance, it does sound like it is a converted B&B or guest house, has it ever been used for that purpose to your knowledge?

Yes, im under the impression that it used to be a guest house, and there are still sinks in every bedroom, but has been used as a normal house for its last 2 owners (dating back to the 90's)

We also live in a seaside town... so there are actually a LOT of houses configured this way in the town, and on the street alone theres about 5 others... but none having recently sold so that could be the issue