Worth getting a valuation?

The_Exquisite

We are cash buyers and were first to view a second hand new-build with a guide price of £190-200k. We have agreed £194k. The seller is chain-free.

The Housebuilder are asking for £186-£188k with freebies on plots in a slightly worse location (fairly close to a busy road). They have three available but i've seen plots being bought recently and they are confident enough to be increasing prices even on plots that have gone unsold for a month or so (can I assume down-valuations on plots are pretty rare?). The vendor bought the house 18 months ago for £160k and as far as i can see the only other, more recent, new-build sales on land registry for this development and this house type sold for £165k january 2020.

Is a valuation not a great idea since the vendor:
knows we can afford what we've offered (although we might only live in it for two or three years)
knows the asking prices of plots
and knows their location is slightly better

Also what would be a likely cost of valuation on this sort of property value? (I will call for quotes on tuesday).

Thank you!

davilown

Do you need a valuation from an independent person? 

If you were getting a mortgage then you’d have to get one, but if you’re happy with the price then you don’t need to get on in my opinion.

good luck!

ps location will normally out trump price for me

NameUnavailable

160 to 194 in 3 years? Suggests the property is over priced. But if you like it and can afford it (without a mortgage) then it's entirely your choice. If you are getting any amount of mortagage then the lender will be carrying out a valuation anyway.

Redwino222

Okay, you offered and agreed a price on a house and are now having cold feet.

First point, which I am sure your realise, you should have thought this all though before you offered.  If you now want to reduce your offer you are going to seriously annoy the vendor, and if it was me the house would go back on the market, or to another bidder.  The valuation should have happened before you bid not after.

If you aren’t happy and think the other plots offer better value for money, pullout now and buy the new build near bathe busy road - save yourself £6k.  If you would rather spend the extra few thousand on the house you are agreed with stick with your choice.

if you do ant an independent valuation, think carefully what your next step will be.  Will you reduce your offer and hope you get away with it or walk?  

GDB2222

The new builds direct from the developer normally go for a premium. After all, there's HTB and so on, and people pay a premium for brand new. So, I'd have thought you'd be paying less than the new build price? Not that I'm suggesting you buy the plots near the road, but just using that as a value yardstick.

If you get a surveyor to value it for you, and he says that you are overpaying say £20-30k, would that affect your decision?

 

The_Exquisite

If the valuation comes back at something like £180k then I would ask the vendor to meet us half way.

Does 'help to buy' effectively mean lenders rarely refuse to lend on new build plots when their surveyor under-values them considerably?

GDB2222

The_Exquisite said:

If the valuation comes back at something like £180k then I would ask the vendor to meet us half way.

Does 'help to buy' effectively mean lenders rarely refuse to lend on new build plots when their surveyor under-values them considerably?

HTB means the government is providing a 20% mortgage that ranks behind the lender in case of a repo. So, yes, the lender can be much more relaxed about valuation.

Redwino222

The_Exquisite said:

If the valuation comes back at something like £180k then I would ask the vendor to meet us half way.

Does 'help to buy' effectively mean lenders rarely refuse to lend on new build plots when their surveyor under-values them considerably?

Were there other bids on the property?

 I had someone bid my house up only to have cold feet.  I was incredibly cross about it, so maybe I am projecting here.  Other people had dropped out or cancelled viewings because if the high offer this person made.  I put the house back in the market and lost about a month because of It.  Be prepared for an irritated vendor, particularly if you used being a cash buyer to strengthen your bid.

i am of course not saying you should proceed with a house you think you are overpaying for.  But this is why people should be more informed and controlled at the bidding stage.  This information was available to you then.

Scotbot

You can get a surveyor to do a valuation, normally they would do it as part of a survey but you don't need one for a new build.  A valuation would cost a couple of hundred but it would only be based on the outside as to gain access you would need the vendors appoval. My guess is if it came back low the vendor will argue that the surveyour didn't see the inside. 

I would argue being close to a busy road downvalues a house by at about 5% depending how busy the road is. So a 186k house in a better position would be 195k. Thus 194 could be a fair price , at any rate it is only a couple of thousand over.

You can get a valuation for peace of mind bur I don't think it will help you renegotiate.

AdrianC

It's a simple trade-off for you.

£194k for this property, on this plot, without the new-build incentives (which don't apply to you), without the never-used-before sheen, and initial snagging done.
   -or-
£186k for similar property, on an "inferior" plot, but with the irrelevant incentives, with the sheen that wears off the first time you use the loo, and with the potential for snagging.

You clearly know which of those two you prefer.

A valuation would only be for your purposes - you have no lender needing that feet-on-the-ground view of the value.

So... are you happy with the deal, or do you need a hug from a man with some letters after his name?