Downvaluation (automated) by lender

mi-key

The other thing to consider is what else you can get within your budget. If there are loads of houses that are cheaper or the same price but better value and condition, then go for one  of those.  If there isn't and you have found a house you like and it is within budget, then go for it.

If you hadn't had an automated valuation and were just going by what your surveyor has said, would you still buy at £812K ? 

Your lender is happy to lend you enough to buy the house, so the valuation isn't really relevant.

I would believe your surveyor more on what the house is worth than a computer generated automated valuation from someone who has never seen it 

nuhopper

Sarah1Mitty2 said:

nuhopper said:

Sorry, meant the HSBC valuation was 780k.

Use PropertyLog to see if houses in similar condition are reducing, and make your decision from there.

Thanks for this tip, just checked it out! Absolutely nothing has reduced in price in the area - is this a London thing? Noted that a house we looked at in December, in the £1m region, just a few streets away, is back on the market as of last week listed at the exact same price that we felt was too high. They couldn't sell it last time at that price but they are trying again at the exact same asking price.  

MultiFuelBurner

Ah the mythical "fair" price. Can be a very difficult thing to achieve unless you are willing to let a few slip through your hands.

What other options are there locally at the £815k budget?

nuhopper

MultiFuelBurner said:

Ah the mythical "fair" price. Can be a very difficult thing to achieve unless you are willing to let a few slip through your hands.

What other options are there locally at the £815k budget?

There aren't many - call our budget 950 as that's the size of the pot in total more or less. They do come up as a terrace with a loft conversion, but what we liked about this house was it has off street parking and a massive garden. It's just hard not to feel uptight about it all. I am sure the vendors' children think they are getting a fair price for the place at 812.

I guess it comes down to what mi-key says: 
Your lender is happy to lend you enough to buy the house, so the valuation isn't really relevant.

They are happy because we have a big deposit, and it's not their 30k they may be "losing", its ours.

It's the principle that gets my goat and the misery of maybe knowing in a year's time that we paid too much. I want the dial to fall square in the middle at "fair" i.e. pay asking price but as MultiFuelBurner calls it, it's a myth! The vendors won't go for it probably - out of their own principle.

MultiFuelBurner

Sometimes you just need to talk it all through. Sounds like you will still have a healthy renovation budget even if paying £815k which could elevate the house price to what (guessing 1.1 million if spent wisely) 

Try looking at the longer term picture?

nuhopper

MultiFuelBurner said:

Sometimes you just need to talk it all through. Sounds like you will still have a healthy renovation budget even if paying £815k which could elevate the house price to what (guessing 1.1 million if spent wisely) 

Try looking at the longer term picture?

true, thanks MFB, it's all so confusing, but we do plan to make it lovely and live there a good long while. 

Sarah1Mitty2

nuhopper said:

Sarah1Mitty2 said:

nuhopper said:

Sorry, meant the HSBC valuation was 780k.

Use PropertyLog to see if houses in similar condition are reducing, and make your decision from there.

Thanks for this tip, just checked it out! Absolutely nothing has reduced in price in the area - is this a London thing? Noted that a house we looked at in December, in the £1m region, just a few streets away, is back on the market as of last week listed at the exact same price that we felt was too high. They couldn't sell it last time at that price but they are trying again at the exact same asking price.  

Probably too early for sellers to cave in on their desire to still get peak prices, this will change as people get used to the new reality of borrowing costs etc. and probably isn`t unique to London IMO.

mi-key

nuhopper said:

MultiFuelBurner said:

Ah the mythical "fair" price. Can be a very difficult thing to achieve unless you are willing to let a few slip through your hands.

What other options are there locally at the £815k budget?

There aren't many - call our budget 950 as that's the size of the pot in total more or less. They do come up as a terrace with a loft conversion, but what we liked about this house was it has off street parking and a massive garden. It's just hard not to feel uptight about it all. I am sure the vendors' children think they are getting a fair price for the place at 812.

I guess it comes down to what mi-key says: 
Your lender is happy to lend you enough to buy the house, so the valuation isn't really relevant.

They are happy because we have a big deposit, and it's not their 30k they may be "losing", its ours.

It's the principle that gets my goat and the misery of maybe knowing in a year's time that we paid too much. I want the dial to fall square in the middle at "fair" i.e. pay asking price but as MultiFuelBurner calls it, it's a myth! The vendors won't go for it probably - out of their own principle.

None of us have crystal balls sadly. You could buy it today for £812K and in a year it could be worth £900K and you would think you got a bargain. Or prices in the area could drop for some reason and it could be worth £750K. If you are planning on staying there a good while though, it will go up in value as that is what property always does over enough time.

Rather than looking at short term what it will be worth in a few months, think about what it will be worth in 5 years. And when you have done the building and renovation work, that will add even more value to it. 

You would only 'lose' £30k If you bought it today and had to sell in a month and then found out you had paid too much, I would bet if you buy it, in 12 or 18 months time you will be pleasantly surprised at how much it has risen

RelievedSheff

nuhopper said:

MultiFuelBurner said:

Sometimes you just need to talk it all through. Sounds like you will still have a healthy renovation budget even if paying £815k which could elevate the house price to what (guessing 1.1 million if spent wisely) 

Try looking at the longer term picture?

true, thanks MFB, it's all so confusing, but we do plan to make it lovely and live there a good long while. 

In which case does a very minor "down valuation" really matter?

It is going to be a long term home.

Schwarzwald

nuhopper said:

Also to say the house is very much within our affordability with us being able to hold about 100k back for refurbs. I just don't want to pay £30k over the odds. We sold for a fair price after doing a lot of work to our house so I'd like to feel we got our next  house at a fair price too. I don't know if it's just London  but even as a chain free buyer it feels like the vendor/ agent are always out for a few more grand and it gets to this point in the sale and I get confused, uncertain, feel ripped off and want to walk away.

Nobody wants to pay £30k too much for anything

but you focusing a bit too much on this aspect, 812/780k is a 4% deviation between what you agreed and what a bank in the current climate conservatively estimates.

if you really liked something in a shop that you will use for many many years to come and it costs £104 instead of £100, would you let it go?

its a matter of perspective and in this price range you shld stop focusing on the 30k aspect but focus on the % deviation