20,000 undervalued help

AnotherJoe

Northernmummy26 said:

Eserv have valued our £225,000 at £205,000 the buyer can't contest as there has only been 1 property that sold in the last 6 months for £195,000 to compare it. The buyer is now looking at other mortgages. 

I think you are lucky they arent looking at other houses.

Northernmummy26 said:

Obviously we can drop our price but the more we drop the less we loose. 

Sorry, not getting that. Wording got tangled?

Northernmummy26 said:

I'll also state we had 5 viewers lined u pto view and we sold to the first viewer as wanted to put an offer in on a property ourselves. So we cancelled the other viewers. I know they may not have wanted our house but it was popular

Go back to EA and see if any other buyers interested still?

moneysavinghero

If it was just one EA then they may have priced higher than they thought the property was worth in the hope that you would pick them over someone who valued it lower. As you accepted at £225k the EA have not done their bit in getting you a buyer at the price they said.

It's not the job of surveyors to catch up with the housing market. It's their job to value the house at what it could be sold for in a sensible market. This crazy crazy market wont last for ever. The mortgage companies don't want to be stuck with houses that are worth less than the mortgage owed on them in a year or twos time.

Northernmummy26

AnotherJoe said:

Northernmummy26 said:

Eserv have valued our £225,000 at £205,000 the buyer can't contest as there has only been 1 property that sold in the last 6 months for £195,000 to compare it. The buyer is now looking at other mortgages. 

I think you are lucky they arent looking at other houses.

Northernmummy26 said:

Obviously we can drop our price but the more we drop the less we loose. 

Sorry, not getting that. Wording got tangled?

Yes tangled! The more we loose^^^

Houses in our area are going extremely quickly. There is very little 3 bedroomed houses with gardens available. I'm actively keeping an eye on the market... As I'm sure he is however there literally has been nothing come up. It's a very small market! 

Northernmummy26

3 quotes from Estate agents. Ranging from 225-250

K_S

@northernmummy26 As far as the buyer is concerned, it's usually far quicker to just apply with a new lender. There is no guarantee that the outcome will be different but I've had two cases in the last month where everything else remaining the same, lender 1 downvalued it materially and lender 2 valued it at the purchase price.

Doesn't always work but sometimes clients have their heart set on a property. Plenty of no upfront cost purchase mortgages in the market right now.

NortheastEA

Its a very interesting time for both EA and surveyor..... As agents our role is to read the market conditions and achieve the best price for our clients. we had this from early 2000 onwards and as prices keep going up the "comparable solds" are about 6 months behind. So the comparables we use are based on what happening now NOT 6 month ago. The agent has done his job and got the best price and the surveyor (who works for the bank dont forget) has done his. In a market that is going up so quickly there will also be down valuations the frustration for many EA and sellers is that the next surveyor for another bank may "value" it at the agreed price.

As a buyer they have to decide if they want to buy the house and what they are wiling to pay based again on what the surveyor says and there own financial situation.

EG sold a house to a investor late last year for £130k - he spends £15k on a refurb and we have sold it at £187k from an asking price of offers over 180k after the usual multiple offers and best bid - the bank however says its only worth £175k. We have no comparables that would justify the £180k - we just know what its "worth" from knowing the market at this time - seller wont budge and buyer wont go up or get another lender so we re-market ..... guess what we sell again for higher BUT this time the lender says its fine and we all move on!

In my area we can afford to take the risk and if we do get a down valuation the odds are in our favour that we will resell it and find a lender willing to lend at the price agreed (we are taking on average 5 offers per property) so best to take advise from your agent.....

Its a much harder job for a surveyor in a market like this as they have to assess the risk for the bank and have make an informed, "factually" based valuation whereas an agent can pluck a number out the air and run with it. 

Im 26 years in and expect to work a few more so will likely see boom and bust possibly a few more times as price go up and down.......

Northernmummy26

Thanks. I'll update once I hear, anymore if anyone else finds the self in the same situ. If we reduce by £5000 the buyer would still need to find £15000 which I really don't know how much they have

NortheastEA

Your agent will know how much deposit they have ..... as part of the due diligence on the offer they should have have ascertained the size of deposit and loan to value (LTV).

So if original purchase price was £225k and deposit was say £50k they are lending £175k. To make up the shortfall to buy at £220k they take 15K out the deposit leaving £35k as the deposit from the banks point of view and ask the bank if they will lend them £170,000..... they end up paying less mortgage BUT have paid £15k more than the house is "worth" to the bank - the maths works but can the agent persuade them to pay.......

This all falls part if the deposit is say 10% ie £22,500 as the LTV would then be too high for the bank as they would only have £7,500 deposit and that LTV at £205k is 96% which lenders dont do

hopefully my maths is correct !!

davilown

NortheastEA said:

Your agent will know how much deposit they have ..... as part of the due diligence on the offer they should have have ascertained the size of deposit and loan to value (LTV).

So if original purchase price was £225k and deposit was say £50k they are lending £175k. To make up the shortfall to buy at £220k they take 15K out the deposit leaving £35k as the deposit from the banks point of view and ask the bank if they will lend them £170,000..... they end up paying less mortgage BUT have paid £15k more than the house is "worth" to the bank - the maths works but can the agent persuade them to pay.......

This all falls part if the deposit is say 10% ie £22,500 as the LTV would then be too high for the bank as they would only have £7,500 deposit and that LTV at £205k is 96% which lenders dont do

hopefully my maths is correct !!

Not sure the EA will know what deposit a buyer has - mine certainly doesn’t!

davilown

To the op, the market is very odd in the past 4 weeks. A lot of reductions are happening, and quite a few SSTC now back on the market.

I think we’re about to see a flattening of prices due to summer holidays, stamp duty etc. Add this to a potential realisation that some properties are well overpriced, they may be some disappointed vendors (and buyers!)