How to know if you are paying fair price or overpaying on property

LLM000

Is there a sure and definite way to know how much a property is actually worth - not an estate agent selling at a price they want to make the most commission and not random sites that seem to value vastly differently.

I have been told (true or not I don't know) that surveyors don't value anymore - the one I currently am working with has said they no longer value a property.

How am I meant to know if what I am paying is a fair price? Looking at history of the last big financial crash, it took a few years for house prices to pick up so if I buy now it is a worry that if I come to sell in 3-5 years that I could be in negative equity.

I know to look at recent sold prices in the area that you are buying but the property is somewhat unique so it does make it hard. The most similar I can find in the area are being sold much cheaper (100k+) for same sq ft. 

I also would want to know if the previous owner seriously overpaid as they purchased in 2020/2021 when people were paying over the odds for properties! If the purchase goes through as planned currently the seller would have made circa 50k (not added value to the property at all) and this is after paying less than the original asking price (don't want to go into exact figures). Is there any way to find old listings with original asking prices so it can help with my worries?

Sarah1Mitty2

Surveyors don`t value any more? You can be sure though that if a bank is lending you money to buy it they will be valuing it properly for the current economic climate, that is your price guide, and you probably shouldn`t be offering over an asking price any more IMO.

LLM000

Sarah1Mitty2 said:

Surveyors don`t value any more? You can be sure though that if a bank is lending you money to buy it they will be valuing it properly for the current economic climate, that is your price guide, and you probably shouldn`t be offering over an asking price any more IMO.

The bank valued the property on a 'drive by' basis - assuming only looked online as they did not visit the property at all. They have agreed our mortgage which gives me some reassurance but equally as they have not fully looked at the property, it does leave me feeling uncertain. 

donutandbeer

Find a different surveyor? Some require you to pay a bit extra for a valuation on top of the survey.

LLM000

donutandbeer said:

Find a different surveyor? Some require you to pay a bit extra for a valuation on top of the survey.

I will look around. So it is still a service surveyors offer to value properties? People I have spoken to in person have been saying a lot don't do that anymore.

user1977

LLM000 said:

donutandbeer said:

Find a different surveyor? Some require you to pay a bit extra for a valuation on top of the survey.

I will look around. So it is still a service surveyors offer to value properties? People I have spoken to in person have been saying a lot don't do that anymore.

It's one of the core things which surveyors do. I suggest you speak to different "people"!

CSI_Yorkshire

LLM000 said:

Is there a sure and definite way to know how much a property is actually worth

How much it is worth is purely how much someone will pay for it.  How much it is worth to you is different from how much it is worth to someone else.

What you're asking is "is there are way to find out what someone else thinks it is worth."  Is that really what you want to know?

edit:  The mortgage surveyor is only concerned about "is it worth enough that the bank can get their capital back".  Again, not a useful number for you.

p00hsticks

LLM000 said:

donutandbeer said:

Find a different surveyor? Some require you to pay a bit extra for a valuation on top of the survey.

I will look around. So it is still a service surveyors offer to value properties? People I have spoken to in person have been saying a lot don't do that anymore.

Some types of survey include a valuation as standard, others don't, but sometimes a surveyor will then do one if asked.
You can also get a RICS surveyor to simply do a valuation by itself - I had one done recently to work out potential capital gain on a private sale. I think it cost about £80.

But at the end of the day, IMO it's fairly arbitrary - if you can't get anyone to buy it when you want to sell it a few years down the line then the fact that it was 'worth' so much when you bought it isn't particularly relevant. Some properties that you could get a mortage on a few years back you'd find unmortgageable now due to issues like cladding or flooding, and types of properties and locations go in and out of fashion..... 

Gavin83

LLM000 said:

Is there a sure and definite way to know how much a property is actually worth - not an estate agent selling at a price they want to make the most commission and not random sites that seem to value vastly differently.

I have been told (true or not I don't know) that surveyors don't value anymore - the one I currently am working with has said they no longer value a property.

How am I meant to know if what I am paying is a fair price? Looking at history of the last big financial crash, it took a few years for house prices to pick up so if I buy now it is a worry that if I come to sell in 3-5 years that I could be in negative equity.

I know to look at recent sold prices in the area that you are buying but the property is somewhat unique so it does make it hard. The most similar I can find in the area are being sold much cheaper (100k+) for same sq ft. 

I also would want to know if the previous owner seriously overpaid as they purchased in 2020/2021 when people were paying over the odds for properties! If the purchase goes through as planned currently the seller would have made circa 50k (not added value to the property at all) and this is after paying less than the original asking price (don't want to go into exact figures). Is there any way to find old listings with original asking prices so it can help with my worries?

I don't know how much money you're talking for the house here but we bought ours in mid/late 2021. It was valued by our surveyor and also by the lender at the time at the price we paid. We had it revalued a few months ago and it was valued at £50k more than we paid so it's certainly not unthinkable that it's gone up by that amount.

Ultimately there is no one authority on how much a house is worth though and most parties are biased one way or another. Your best bet is to get your own surveyor to value it and make sure they do so in person with a proper look inside and out. A house is really worth what someone is willing to pay for it though.

Sarah1Mitty2

LLM000 said:

Sarah1Mitty2 said:

Surveyors don`t value any more? You can be sure though that if a bank is lending you money to buy it they will be valuing it properly for the current economic climate, that is your price guide, and you probably shouldn`t be offering over an asking price any more IMO.

The bank valued the property on a 'drive by' basis - assuming only looked online as they did not visit the property at all. They have agreed our mortgage which gives me some reassurance but equally as they have not fully looked at the property, it does leave me feeling uncertain. 

Are you using PropertyLog to monitor asking prices in your area?

CSI_Yorkshire

Sarah1Mitty2 said:

LLM000 said:

Sarah1Mitty2 said:

Surveyors don`t value any more? You can be sure though that if a bank is lending you money to buy it they will be valuing it properly for the current economic climate, that is your price guide, and you probably shouldn`t be offering over an asking price any more IMO.

The bank valued the property on a 'drive by' basis - assuming only looked online as they did not visit the property at all. They have agreed our mortgage which gives me some reassurance but equally as they have not fully looked at the property, it does leave me feeling uncertain. 

Are you using PropertyLog to monitor asking prices in your area?

Asking price =/= property value to any individual other than the vendor.