Property downvalued by 35-40K

gm786

Hi 
Our buyers bank valuers Halifax via E Serve have down valued our property by 35-40K. Was offered 475K but they valued at 435-440K
We were going to use the proceeds from this sale to buy another property and also the valuation seems very low as we had 5 estate agents all value between 475-500K
435-440K seems low even as per our estate agent

We have asked the buyer to see if they want to try a different lender but afraid that the new lender may use the same valuer and we end up with similar or may be even less valuation

I couldn't find a thread on this topic recently but it seems from the various estate agents we spoke that this is a very low valuation and we shouldn't accept. What is not in our favour is that there are many properties of our size for sale and market doesn't seem good for them where we are 
Also recently any property our size has not sold in our area so there seem to be no comparables. Properties sold nearby were either smaller than ours or pretty old.

What are people's views? Anyone been through something like this recently that they can share their experience please?

Thank you 

pramsay13

The surveyor's valuation is more likely to be accurate as that's all they do and they don't have anything to gain by inflating the value the way the estate agents do. 
What did you buy it for and when?

gm786

We bought it new build 7 years ago have added a extension and second reception room

We have atleast 10 people including estate agents telling us it not right .. why would so many of them say its worth 475-500 when its not is confusing because they too will only get their commission if the property sells and price being right plays an important part isn't it?

Our Estate agent too thinks its not right and he has been in the business for over 20 years 

Not looking to recover what we spent but how do you justify 40K less?

 We cannot reduce price but dnt know what else to do 

BikingBud

gm786 said:

Hi 
Our buyers bank valuers Halifax via E Serve have down valued our property by 35-40K. Was offered 475K but they valued at 435-440K
We were going to use the proceeds from this sale to buy another property and also the valuation seems very low as we had 5 estate agents all value between 475-500K
435-440K seems low even as per our estate agent

We have asked the buyer to see if they want to try a different lender but afraid that the new lender may use the same valuer and we end up with similar or may be even less valuation

I couldn't find a thread on this topic recently but it seems from the various estate agents we spoke that this is a very low valuation and we shouldn't accept. What is not in our favour is that there are many properties of our size for sale and market doesn't seem good for them where we are 
Also recently any property our size has not sold in our area so there seem to be no comparables. Properties sold nearby were either smaller than ours or pretty old.

What are people's views? Anyone been through something like this recently that they can share their experience please?

Thank you 

That's likely your answer then. 

Have you explored the options for a follow on purchase as it is price difference that is key not absolute price.

Bear in mind also lower prices save you SDLT, so you win on that front as well 🥳

We can offer opinion on here all of it will have some bias and prejudice but you need to do what you feel is right for you.

user1977

It's only "£40k less" than a hoped-for value which (it appears) nothing similar has ever achieved in reality. The actual value is what you can sell it for.

Bear in mind that valuation is never an exact science, and there's an even bigger margin for error where there is a lack of comparables (I think +/- 10% for the purposes of negligence claims against surveyors). That of course works both ways, but I don't think you can be certain that you'll achieve the price assigned to it by the EA.

MeteredOut

Hard to hear, but whereas you see this as a down-value, the surveyor simply sees it as the value.

For each of the 10 people who are telling you the higher valuation is correct, can you truly say there is no benefit in them telling you that?

Someone has already pointed out that you answered your own question: "there are many properties of our size for sale and market doesn't seem good for them where we are". Lenders know this and don't want to lend on a property where the owner may end up in negative equity.

It's a variation to the old cliche, but a property is only worth what someone is willing to lend on it. 

Have your buyers asked their surveyor for reasonings behind the valuation and its difference to what your estate agent valued it at?

How did you valuation of the property you're hoping to buy compare to your offer on that property? Have you considered lowering that offer?

RelievedSheff

You don't have to accept a lower offer from your buyers. They could try another lender or if they don't want to do that you can remarket if you believe you can get the higher price.

gm786

Have your buyers asked their surveyor for reasonings behind the valuation and its difference to what your estate agent valued it at?

No comparables they said 

How did you valuation of the property you're hoping to buy compare to your offer on that property? Have you considered lowering that offer?

We buying a new build and as everyone knows they are inflated in price- valuation for that one ws exact as per builder and came back in a day!

gm786

You don't have to accept a lower offer from your buyers. They could try another lender or if they don't want to do that you can remarket if you believe you can get the higher price.

That is what we may end up doing, thanks 

Albermarle

Rather than accept £35K off, or remarketing the property, why not try and negotiate/
Maybe say offer a reduction of £5K . Probably they will say something like minimum £25K and you end up somewhere in the middle.
In advance set yourself a bottom line and stick to it. 

bobster2

Estate agent valuations are usually the price they think you should market the property for - e.g. asking price.

Properties sell on average for 3-5% below asking price. So a £475k estate agent valuation for marketing - could mean expect to complete the sale at £450k (5% below asking). Not that far from their valuations.