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Property ‘undervalued’ by 15k... is it fair to ask to meet in the middle?

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  • Going off piste here but....

    What happens (if anything) if the buyer's lender is the same as the vendor's lender.  For arguments sake, prior to listing a place is currently valued by the bank as 200k.  The potential buyer applies to the same bank and the valuation comes in at  say185.  If the sale doesn't complete and house is removed from the market, does it keep the original value or would it ammend to the new valuation?

    Genuine question as I haven't a clue.
  • AdrianC
    AdrianC Posts: 42,189 Forumite
    Eighth Anniversary 10,000 Posts Name Dropper
    Going off piste here but....

    What happens (if anything) if the buyer's lender is the same as the vendor's lender.  For arguments sake, prior to listing a place is currently valued by the bank as 200k.  The potential buyer applies to the same bank and the valuation comes in at  say185.  If the sale doesn't complete and house is removed from the market, does it keep the original value or would it ammend to the new valuation?

    Genuine question as I haven't a clue.
    The vendor's mortgage is completely separate to the buyer's.

    If the vendor were to try and remortgage with that lender, they may well go with a £185k valuation - but if they stay with their original mortgage, nothing changes.
  • Crashy_Time
    Crashy_Time Posts: 13,386 Forumite
    10,000 Posts Seventh Anniversary Name Dropper
    edited 27 April 2021 at 4:11PM
    Going off piste here but....

    What happens (if anything) if the buyer's lender is the same as the vendor's lender.  For arguments sake, prior to listing a place is currently valued by the bank as 200k.  The potential buyer applies to the same bank and the valuation comes in at  say185.  If the sale doesn't complete and house is removed from the market, does it keep the original value or would it ammend to the new valuation?

    Genuine question as I haven't a clue.
    How much the vendor borrowed doesn`t affect any new valuation.
  • Crashy_Time
    Crashy_Time Posts: 13,386 Forumite
    10,000 Posts Seventh Anniversary Name Dropper
    The house we had to pull out of due to a 40K down valuation has just had second sale fall through. Back on the market for same price

    Personally I think anyone would be mad to pay that 40K+deposit themselves but each to their own.

    I think some sellers are not being advised very well or they are ignoring what is going on
    They have been exposed to a barrage of "positive" sentiment about property for years, the fact that some of the people pushing that sentiment now think it is "overheated" is a red flag IMO.
  • Mickey666
    Mickey666 Posts: 2,834 Forumite
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    Mickey666 said:
    Agreed.

    Though the interesting thing is that as far as market statistics are concerned, if there is no sale as a result of this down valuation then it remains invisible to the market. 

    As far as the vendor is concerned, the house is still worth their asking price and they are likely to simply keep it on the market until someone can offer that price AND complete . . . at which point the house IS worth that price and THAT is what the market stats will reflect. 

    In effect, there is NO down-valuation at all, only a number of discontented potential buyers who didn't offer enough.


    That is the definition of "delusional kite flyer", but in reality they will struggle to get their asking price after a devaluation from the bank.
    Only in the short term.
    'Waiting for the market to come to you' is a well known selling tactic for owners who want a certain price and are prepared to wait for it.  Happens all the time.  And it works.
  • davilown
    davilown Posts: 2,303 Forumite
    Part of the Furniture 1,000 Posts Name Dropper Combo Breaker
    I think there 2 ways to look at this op.

    If the vendor has to sell then it’s worthwhile going back to them to say that the valuation is £15k less and start negotiations again. You may get some money off or you may have to pull out. Better now than close to exchange.

    If the vendor is just trying their luck then you have much less of a chance. You can try to renegotiate but potentially less likely to be successful.

    Start looking for somewhere else that you can AFFORD, without getting into a bidding war. EAs are, at the end of the day, sales people. They will try their hardest to get the best bid from you.

    On a side note, we are still looking in the South East, and the EAs are starting to send us emails/leave voicemails about available properties that are priced ‘strongly’ and aren’t getting viewings let alone offers.

    Hopefully a little downturn in prices will work out right for us, but if not, c'est la vie.
    30th June 2021 completely debt free…. Downsized, reduced working hours and living the dream.
  • sammyjammy
    sammyjammy Posts: 7,950 Forumite
    Part of the Furniture 1,000 Posts Name Dropper Photogenic
    Debate the Economy, House prices board is closed.... as will this thread be soon
    "You've been reading SOS when it's just your clock reading 5:05 "
  • AnotherJoe
    AnotherJoe Posts: 19,622 Forumite
    10,000 Posts Fifth Anniversary Name Dropper Photogenic
    edited 28 April 2021 at 9:04AM
    Debate the Economy, House prices board is closed.... as will this thread be soon

    Which is a pity as closing it hasn't helped at all. It was a pointless action in the first place.
  • Crashy_Time
    Crashy_Time Posts: 13,386 Forumite
    10,000 Posts Seventh Anniversary Name Dropper
    Mickey666 said:
    Mickey666 said:
    Agreed.

    Though the interesting thing is that as far as market statistics are concerned, if there is no sale as a result of this down valuation then it remains invisible to the market. 

    As far as the vendor is concerned, the house is still worth their asking price and they are likely to simply keep it on the market until someone can offer that price AND complete . . . at which point the house IS worth that price and THAT is what the market stats will reflect. 

    In effect, there is NO down-valuation at all, only a number of discontented potential buyers who didn't offer enough.


    That is the definition of "delusional kite flyer", but in reality they will struggle to get their asking price after a devaluation from the bank.
    Only in the short term.
    'Waiting for the market to come to you' is a well known selling tactic for owners who want a certain price and are prepared to wait for it.  Happens all the time.  And it works.
    Won`t work at this point in time IMO, we are at basically a watershed moment for monetary policy/public health, and I would argue that at any time the time frames involved make dropping the price an easier option for people who just want to sell and move on with their lives.
  • Mickey666
    Mickey666 Posts: 2,834 Forumite
    1,000 Posts Photogenic First Anniversary Name Dropper
    Mickey666 said:
    Mickey666 said:
    Agreed.

    Though the interesting thing is that as far as market statistics are concerned, if there is no sale as a result of this down valuation then it remains invisible to the market. 

    As far as the vendor is concerned, the house is still worth their asking price and they are likely to simply keep it on the market until someone can offer that price AND complete . . . at which point the house IS worth that price and THAT is what the market stats will reflect. 

    In effect, there is NO down-valuation at all, only a number of discontented potential buyers who didn't offer enough.


    That is the definition of "delusional kite flyer", but in reality they will struggle to get their asking price after a devaluation from the bank.
    Only in the short term.
    'Waiting for the market to come to you' is a well known selling tactic for owners who want a certain price and are prepared to wait for it.  Happens all the time.  And it works.
    Won`t work at this point in time IMO, we are at basically a watershed moment for monetary policy/public health, and I would argue that at any time the time frames involved make dropping the price an easier option for people who just want to sell and move on with their lives.
    It's nothing to do with 'this point in time'.   There are always different motivations for different sellers.

    For those sellers who "just want to sell and move on with their lives" then dropping their asking price for  quick sale obviously makes sense.

    For those sellers who are in no rush to sell and want to get the maximum possible price for their property then pitching their asking price above the prevailing market price (whatever that really means) and just waiting until someone offers that price also makes perfect sense.

    Both strategies will work at any time, regardless of the prevailing market conditions and state of the economy.
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