Seller reject survey valuation?

fackers_2

Hello! Recent offer of a property. Long story short. Has anyone found themselves in a position recently where the offer negotiated was accepted then the survey and/or mortgage valuation was less and it was rejected by the seller? 

Did it go back on the market or was the reduction accepted? (House has been on for 3 months with no other offers). 

Dustyevsky

Individuals' experiences are unlikely to reveal a meaningful pattern in a small sample. In the current fiscal climate, a down-valuation of sensible proportions wouldn't be rejected by me, assuming I'd found somewhere attractive, but with the market slowing, people may not be finding much. That too is down to individual areas.

Wonka_2

Bit more detail needed - and even then it'll be peoples personal experiences rather than a trend or rule

How far below the accepted price is the valuation in %  and on what value property
What was the reasoning given - specific work needed from a survey or just a desktop valuation which may be challenged if there are specific reasons for the individual property ? 

eddddy

Do you mean that you made an offer that was accepted, but your mortgage lender has valued the property lower? So you want to reduce your offer to match the mortgage lender's valuation?

Some sellers might accept a reduced offer, others might not. Or they might try to negotiate a compromise.

It tends to depend on the seller's circumstances and their mindset - there isn't really a general rule.

In simple terms - who is more desperate for the transaction to happen - you or the seller?


(FWIW, if I was selling I might take more notice of a mortgage lender's valuation, but take less notice of a valuation by a surveyor instructed by the buyer.)

TheJP

eddddy said:

(FWIW, if I was selling I might take more notice of a mortgage lender's valuation, but take less notice of a valuation by a surveyor instructed by the buyer.)

Why? What's the difference in this scenario.

eddddy

TheJP said:

eddddy said:

(FWIW, if I was selling I might take more notice of a mortgage lender's valuation, but take less notice of a valuation by a surveyor instructed by the buyer.)

Why? What's the difference in this scenario.

Surveyors act in their client's best interests. If their client (buyer) wants to use a valuation for negotiating purposes, the surveyor can value a property at the lower end of the range.

(It's similar to when surveyors suggest that repairs might cost £x.  They tend to quote numbers at the higher end of the range, to help their client negotiate.)

The last surveyor I used was quite open about this.

mi-key

Assuming you are talking about a mortgage lenders valuation, and not a building survey that has found some problem with the house? 

How much less than your offer was the valuation? If it is a small amount the seller may be willing to negotiate, if its a lot then they may not. 

From the sellers point of view, you made an offer for what you thought the house was worth and they accepted it.

It doesn't really mean much to them that your mortgage lender valued it less as this isn't uncommon, and in that case it is your job to find the extra money to make up the difference if you want to buy.

If they accepted an offer from someone else, their lender may value it fine, or the buyer may not be stretching themselves so can afford to cover any difference easily. 

fackers_2

mi-key said:

Assuming you are talking about a mortgage lenders valuation, and not a building survey that has found some problem with the house? 

How much less than your offer was the valuation? If it is a small amount the seller may be willing to negotiate, if its a lot then they may not. 

From the sellers point of view, you made an offer for what you thought the house was worth and they accepted it.

It doesn't really mean much to them that your mortgage lender valued it less as this isn't uncommon, and in that case it is your job to find the extra money to make up the difference if you want to buy.

If they accepted an offer from someone else, their lender may value it fine, or the buyer may not be stretching themselves so can afford to cover any difference easily. 

Offer subject to survey. It would be foolish IMO to take a house as face value without a trained professionals advice on what is needed that would definitely be missed by someone who has no clue of electrics, brick work etc. 

Generalising and anticipation from me at the moment. No lower valuation but it seems likely. 

JM68

If the survey throws up stuff that makes you think its worth less than your offer then you are free to reduce it, but the vendors are free to not to accept that.  Result is you lose some money spent on survey etc. but just move on to another property. 

If you do that, it is fast becoming a buyers market and there are lots of reductions coming on, which is good for you, but there is also limited and poor quality stock generally on the market (as people expect prices to reduce further) which is not so good.

If the mortgage valuation is lower then you are in a similar position though, depending on your circumstances, you may not actually be able to proceed with your offer even if you want to if you can't make up the shortfall from savings etc.

In terms of what the vendor would do if you walk away there is no 'typical' answer.  A realistic one might reduce and re-list.  A greedy one might just keep listing at the same price as that is what they think 'it is worth'.

p00hsticks

TheJP said:

eddddy said:

(FWIW, if I was selling I might take more notice of a mortgage lender's valuation, but take less notice of a valuation by a surveyor instructed by the buyer.)

Why? What's the difference in this scenario.

Presumably if the mortgage lender down-values the property, that has an immediate financial impact on the buyer - a larger balance for the buyer to find, an increased LTV, possibly at a higher rate,  or even having to find another lender altogether. 

Whereas a valuation by an independent surveyor for the buyers information, although it might change the buyers feelings about how much they want or are prepared to pay for the property, isn't actually going to have any direct impact on the finances involved. 

MultiFuelBurner

We had a buyer back in 2018 that offered full asking price and as we had set the price and used an online estate agent doorsteps at a price of £175 with Rightmove ads we always though we had pushed the ceiling price.

Their mortgage survey came back valuing it £10k less and we settled at £5k reduction in the middle.