FTB in a panic: Lender down-valued property by several thousand. How do I renegotiate price?

Crashy_Time

aoleks said:

Crashy_Time said:

benson1980 said:

Crashy_Time said:

benson1980 said:

Sophie8916 said:

Crashy_Time said:

PirateSwan said:

Hi property peeps

Jumpy / red-faced FTB here

I'm looking for some advice on the down-valuing of a property I offered on a few weeks back

My lender has down-valued it at £7k less than the price I offered (and had accepted). (Backstory: it went to sealed bids. I am at a low ebb life wise and fell for all of the EA's selling tactics when making my bid. Properties are slipping out of affordability reach where I live, so panicked and offered the outer limits of what I can afford. £7k is a huge amount for me as my wage isn't fantastic)

I am totally kicking myself and am also worried if the down valuation will go against me in the future. I have read that when I come out of my fixed rate mortgage then a down valuation could work against me when I apply for a new fixed rate mortgage for the house.

Has anyone ever renegotiated after a down valuation? And If so, what sort of facts / figures did you put forward to support your case?

Buyers, how did you go about it? What did you say to the EA / vendor? And what was the outcome for you?

Sellers: Have you accepted a down valuation and what prompted you to make the decision?

I'd be eternally grateful for any advice anyone can give me. 

Thanks in advance.

P

Are you sure you should be buying a property, what happens when you get a large repair bill? The good news is that when mortgage rates rise houses are going to get cheaper, you should just wait IMO, or alternatively drop your offer by 10k citing "market conditions".

ah this is interesting, when do you think it will be? weve just sold out property (doing a sell high buy cheap approach!) and hoping within 6 months things may be cheaper for us

Risky strategy.  A lot of people said this about the pandemic and driving prices down. We know people who went into rented having sold up and are now convinced the market is over priced and haven’t found anywhere for well over a year. The reality is the market has now over taken them and houses are 70 to 80k more, compared with when they sold. There may be some adjustment at some point, but again people predicting price reductions when interest rates increase are the same people who predicted a crash when covid and lockdown hit. How wrong they were.

A lot of that was simply the SDH, sales are way down now and it is too early to say that Covid/Lockdowns are behind us.
Caution is probably best when taking on big mortgage debt in this environment IMO.

https://www.express.co.uk/news/world/1523059/EU-news-property-market-europe-ecb-Poland-belarus-migrants/amp

My advice is still to take 10k off the offer and stand firm.

Did prices crash when SDH ended- again as some predicted? 

Caution always, and caution should also be applied when coming off the ladder and getting back on at a later date in the hope of a ‘correction’.

Sales have crashed due to end of SDH, broken chains and banks "down-valuing", check LR for more detail, all that holds prices up is low mortgage rates.

nothing has crashed mate, prices are still going up and houses are being snatched within days, if not hours. broken chains has nothing to do with house prices, they were always a thing and down-valuing is different from a crash. yes, some chancers will add £50k on top of the value of the house hoping to trap an idiot in a transaction, but those usually don't sell. everything else sells like hot bread and prices haven't gone down one single penny for years...

What areas are you looking at?

aoleks

Crashy_Time said:

aoleks said:

Crashy_Time said:

benson1980 said:

Crashy_Time said:

benson1980 said:

Sophie8916 said:

Crashy_Time said:

PirateSwan said:

Hi property peeps

Jumpy / red-faced FTB here

I'm looking for some advice on the down-valuing of a property I offered on a few weeks back

My lender has down-valued it at £7k less than the price I offered (and had accepted). (Backstory: it went to sealed bids. I am at a low ebb life wise and fell for all of the EA's selling tactics when making my bid. Properties are slipping out of affordability reach where I live, so panicked and offered the outer limits of what I can afford. £7k is a huge amount for me as my wage isn't fantastic)

I am totally kicking myself and am also worried if the down valuation will go against me in the future. I have read that when I come out of my fixed rate mortgage then a down valuation could work against me when I apply for a new fixed rate mortgage for the house.

Has anyone ever renegotiated after a down valuation? And If so, what sort of facts / figures did you put forward to support your case?

Buyers, how did you go about it? What did you say to the EA / vendor? And what was the outcome for you?

Sellers: Have you accepted a down valuation and what prompted you to make the decision?

I'd be eternally grateful for any advice anyone can give me. 

Thanks in advance.

P

Are you sure you should be buying a property, what happens when you get a large repair bill? The good news is that when mortgage rates rise houses are going to get cheaper, you should just wait IMO, or alternatively drop your offer by 10k citing "market conditions".

ah this is interesting, when do you think it will be? weve just sold out property (doing a sell high buy cheap approach!) and hoping within 6 months things may be cheaper for us

Risky strategy.  A lot of people said this about the pandemic and driving prices down. We know people who went into rented having sold up and are now convinced the market is over priced and haven’t found anywhere for well over a year. The reality is the market has now over taken them and houses are 70 to 80k more, compared with when they sold. There may be some adjustment at some point, but again people predicting price reductions when interest rates increase are the same people who predicted a crash when covid and lockdown hit. How wrong they were.

A lot of that was simply the SDH, sales are way down now and it is too early to say that Covid/Lockdowns are behind us.
Caution is probably best when taking on big mortgage debt in this environment IMO.

https://www.express.co.uk/news/world/1523059/EU-news-property-market-europe-ecb-Poland-belarus-migrants/amp

My advice is still to take 10k off the offer and stand firm.

Did prices crash when SDH ended- again as some predicted? 

Caution always, and caution should also be applied when coming off the ladder and getting back on at a later date in the hope of a ‘correction’.

Sales have crashed due to end of SDH, broken chains and banks "down-valuing", check LR for more detail, all that holds prices up is low mortgage rates.

nothing has crashed mate, prices are still going up and houses are being snatched within days, if not hours. broken chains has nothing to do with house prices, they were always a thing and down-valuing is different from a crash. yes, some chancers will add £50k on top of the value of the house hoping to trap an idiot in a transaction, but those usually don't sell. everything else sells like hot bread and prices haven't gone down one single penny for years...

What areas are you looking at?

what areas are YOU looking at? all the major cities, from the south to Edinburgh, even remote Wales, have seen huge price increases. show me one area that's suffering a crash right now.

MsACam

Apparently the central London multi million flat market is suffering - see today’s The Times - and I’m sure that those purchasers and sellers are all members of this forum…

Crashy_Time

aoleks said:

Crashy_Time said:

aoleks said:

Crashy_Time said:

benson1980 said:

Crashy_Time said:

benson1980 said:

Sophie8916 said:

Crashy_Time said:

PirateSwan said:

Hi property peeps

Jumpy / red-faced FTB here

I'm looking for some advice on the down-valuing of a property I offered on a few weeks back

My lender has down-valued it at £7k less than the price I offered (and had accepted). (Backstory: it went to sealed bids. I am at a low ebb life wise and fell for all of the EA's selling tactics when making my bid. Properties are slipping out of affordability reach where I live, so panicked and offered the outer limits of what I can afford. £7k is a huge amount for me as my wage isn't fantastic)

I am totally kicking myself and am also worried if the down valuation will go against me in the future. I have read that when I come out of my fixed rate mortgage then a down valuation could work against me when I apply for a new fixed rate mortgage for the house.

Has anyone ever renegotiated after a down valuation? And If so, what sort of facts / figures did you put forward to support your case?

Buyers, how did you go about it? What did you say to the EA / vendor? And what was the outcome for you?

Sellers: Have you accepted a down valuation and what prompted you to make the decision?

I'd be eternally grateful for any advice anyone can give me. 

Thanks in advance.

P

Are you sure you should be buying a property, what happens when you get a large repair bill? The good news is that when mortgage rates rise houses are going to get cheaper, you should just wait IMO, or alternatively drop your offer by 10k citing "market conditions".

ah this is interesting, when do you think it will be? weve just sold out property (doing a sell high buy cheap approach!) and hoping within 6 months things may be cheaper for us

Risky strategy.  A lot of people said this about the pandemic and driving prices down. We know people who went into rented having sold up and are now convinced the market is over priced and haven’t found anywhere for well over a year. The reality is the market has now over taken them and houses are 70 to 80k more, compared with when they sold. There may be some adjustment at some point, but again people predicting price reductions when interest rates increase are the same people who predicted a crash when covid and lockdown hit. How wrong they were.

A lot of that was simply the SDH, sales are way down now and it is too early to say that Covid/Lockdowns are behind us.
Caution is probably best when taking on big mortgage debt in this environment IMO.

https://www.express.co.uk/news/world/1523059/EU-news-property-market-europe-ecb-Poland-belarus-migrants/amp

My advice is still to take 10k off the offer and stand firm.

Did prices crash when SDH ended- again as some predicted? 

Caution always, and caution should also be applied when coming off the ladder and getting back on at a later date in the hope of a ‘correction’.

Sales have crashed due to end of SDH, broken chains and banks "down-valuing", check LR for more detail, all that holds prices up is low mortgage rates.

nothing has crashed mate, prices are still going up and houses are being snatched within days, if not hours. broken chains has nothing to do with house prices, they were always a thing and down-valuing is different from a crash. yes, some chancers will add £50k on top of the value of the house hoping to trap an idiot in a transaction, but those usually don't sell. everything else sells like hot bread and prices haven't gone down one single penny for years...

What areas are you looking at?

what areas are YOU looking at? all the major cities, from the south to Edinburgh, even remote Wales, have seen huge price increases. show me one area that's suffering a crash right now.

? I said SALES have collapsed, which exposes the fallacy of the "demand" story that some people trot out, and if mortgage rates rise that will affect the "price" part of the equation. So again, the OP certainly shouldn`t panic about downgrading their offer by such a tiny amount!

TXC

It feels like the system is well and truly broken at this point for FTBs especially.

You have to offer over and above to even get your foot in the door (a price you're willing to pay within budget / passed for a mortgage of course) but then the bank will bring you back down to earth valuation wise in the face of a seller who won't budge, and it feels like this is applicable even if you cast your net wide and take a much cheaper house - you're still having to build on top to get a foothold and the bank will still downvalue. Now more so than ever in the face of potential rising interest rates.

Surely something has to change immediately other wise FTBs will need rivers and rivers of spare cash they can lay their hands on, on top of a hilted mortgage to even get anywhere.

Sorry as I know this doesn't help in the slightest, but just venting I suppose.

EDIT: If it wasn't blindingly obvious, the seller I was buying from until recently did not budge on price re: the downvalue from my earlier thread as they didn't agree with the banks value. In spite of me putting in all the spare cash I had to bring it up by 7k they will remarket. So they are going to work their way down the list to see if anybody else can pump up their valuations. And the merry go round continues for the sake of 10k...

Had the initial asking price been accurate as a base to work from (in line with valuation) we would be in a much better position.

Thrugelmir

TXC said:

It feels like the system is well and truly broken at this point for FTBs especially.

You have to offer over and above to even get your foot in the door (a price you're willing to pay within budget / passed for a mortgage of course) but then the bank will bring you back down to earth valuation wise in the face of a seller who won't budge, and it feels like this is applicable even if you cast your net wide and take a much cheaper house - you're still having to build on top to get a foothold and the bank will still downvalue. Now more so than ever in the face of potential rising interest rates.

Surely something has to change immediately other wise FTBs will need rivers and rivers of spare cash they can lay their hands on, on top of a hilted mortgage to even get anywhere.

Sorry as I know this doesn't help in the slightest, but just venting I suppose.

Markets eventually self correct. Only so many people can afford to pay above asking. Await the spring market when activity levels naturally pick up. 

lookstraightahead

The market will need to correct itself. FTB need to just wait if they can't find what they want, like everyone else has to. There will always be properties where you can buy under asking. Don't get on the hearsay wagon.

propertyhunter

I luckily have the fortune of having a really nice estate agent who has told me the prices that have been accepted for the houses I have viewed in the past over the past 6 months (May-October 2021) - even if they are still in the conveyancing process. Of course, it depends on the house and the circumstances of the buyer and seller, but over an average of 10 properties, accepted offers were 1.5% below asking prices - in an area of NW London where 3 bed houses are 775-800. Over those 10 properties, 1 sold at asking price, 1 sold 30 k over and 8 sold under.

[Deleted User]

MsACam said:

Sales have crashed because there is no stock. Everyone who was potentially thinking of moving has done so to take advantage of SDH. Sales were frontloaded. Most who are selling now need to do so rather than electing to do so. 

Not around here sadly. Tiny 2.5 bedroom terrace houses go for £350k before the EA can put the sign up.

We need a severe crash to bring prices back to sane levels, but there is no sign of it yet.

lookstraightahead

[Deleted User] said:

MsACam said:

Sales have crashed because there is no stock. Everyone who was potentially thinking of moving has done so to take advantage of SDH. Sales were frontloaded. Most who are selling now need to do so rather than electing to do so. 

Not around here sadly. Tiny 2.5 bedroom terrace houses go for £350k before the EA can put the sign up.

We need a severe crash to bring prices back to sane levels, but there is no sign of it yet.

We don't need a crash. When interest rates go up, when buyers stop panicking, when banks value properties realistically (which they've started doing by the posts appearing on here), when buyers stop believing the sales hype from the EAs, and when vendors have a word with themselves, things will appear real again (not that we have proper stats anyway to go by).