Division of House Equity - Advice Needed

Spartan_Saver

My partner and I have decided to separate amicably. We own our property jointly (50/50) and we have both contributed equally with the upgrades. We've had 3 x local estate agents come and value the property. All three said that the marketing price is £250k. The last one said that realistically we can expect the property to achieve between £240k to £250k. This is a disappointment as online valuations where between £257k to £267k. There are some issues with the property that would get flagged up by a potential buyer : visible damp etc that would likely have the property price renegotiated.

My ex partner already has £2,500 of solicitor fees to pay for her next property but I also want to do what is fair to me. Would you agree on the property's value based on the marketing / listing price or would you make an allowance for the damp as this could likely be an issue if someone was to purchase it and affect the final price.

It is a 1 bed property which every estate agent has said is difficult to sell as people tend to set their search criteria to a minimum of 2 bedrooms.

I would appreciate an unbiased opinion from this amazing community.

DullGreyGuy

They appear to be suggesting what the property should be listed at rather than what it is likely to sell for other than the one?

The problem with estate agents, if you've told them that you are thinking of selling, is they are trying to win your business and the majority of people won't go for the estate agent that tells you that your home is going to sell for £220,000 when the rest are saying £250,000. 

Normally you'd agree it based on the likely sales, not listing, price in the current condition unless you both agree to jointly remediate problems and get it revalued to a higher number. Presumably you're intending to but them out of the property? Have you confirmed the bank will lend to you as a sole debtor?

Spartan_Saver

Thanks for the insight. Yes, the mortgage and change over has been approved by the bank. It's just a matter of getting it approved by the underwriters. 

Listing price seems realistic. How much will it sell for is a different story. Online valuations range from £252k to £267k in the middle range of the spectrum. I just don't know whether we should take the Estate Agents listing valuations and reduce it by the cost of fixing the problem with the damp. 

My ex partner already feels she is down £17,000 as we both expected the valuations to come to £265k - £267k. 

I don't have much faith in the bank's valuation as I told them it was £264k when we remortgaged two years ago and that is what they recorded. Mind you it is a low loan to value so it would not affect the mortgage rate. The valuations we've had this week by local estate agents say that the listing price should be £250k . 

HouseMartin567

I’d be careful in paying too much notice of online valuations - they are just looking at an average for an area or postcode. The actual value is individual to the house (and what someone is willing to pay for it), and you are already aware of issues that will be flagged which wouldn’t be taken into consideration on the online value. The opinion of the estate agents who have seen it will be more valid that online desktop valuations - although as someone said above, even the estate agent valuations may be optimistic seeing as they are trying to win your business.

DE_612183

are you trying to buy the property from your ex?

Your ex will also need to pat stamp duty as well as solicitors fees.

On-line valuations are rubbish - take a look at Land Registry sold prices or rightmove sold prices and see what similar properties have gone for.

From what you've said I'd suggest 245 is about right.

AskAsk

as someone had said, it sounds like you are buying her out of the property and so want to come to a realistic price for the split?

first thing is forget online valuation, they are widely inaccurate.

second thing, don't always expect the EA valuation to be correct either as they always put it on high and then reduce if no one bites, it is their way of getting you to sell with them by promising to get you a good price and their way to test the market

i would say the price to look at is the bottom of the range from the realistic agent, so 240k then knock off the cost of fixing the damp as the buyer will want money off to fix this when the survey comes back.  so you could get a damp company to come round and quote for fixing it and that will give you a good idea of how much a buyer will be asking for as a reduction.  you could also fix it yourself now.

gwynlas

If your ex is already committed to their next purchase then it raises an issue of speed of sale and whether this is to yourself or a third party.
In a slow market you might have to wait for anything close to asking price.
It might be better looking at sold prices in a near radius and base expectations on those,
Estate agents value high to get your business but when propert fails to attract viewers will advise you accept low offers as it barely affects their commissioon 1.5% of £20k is only £300.

Spartan_Saver

DE_612183 said:

are you trying to buy the property from your ex?

Your ex will also need to pat stamp duty as well as solicitors fees.

On-line valuations are rubbish - take a look at Land Registry sold prices or rightmove sold prices and see what similar properties have gone for.

From what you've said I'd suggest 245 is about right.

Yes - I am buying my ex partner out. I've learned my lesson with online valuation. We both genuinely thought the house was worth substantially more. Thanks for your input. Really appreciated. 

pinkshoes

Spartan_Saver said:

DE_612183 said:

are you trying to buy the property from your ex?

Your ex will also need to pat stamp duty as well as solicitors fees.

On-line valuations are rubbish - take a look at Land Registry sold prices or rightmove sold prices and see what similar properties have gone for.

From what you've said I'd suggest 245 is about right.

Yes - I am buying my ex partner out. I've learned my lesson with online valuation. We both genuinely thought the house was worth substantially more. Thanks for your input. Really appreciated. 

I will re-iterate that online valuations are done through data and nearby sales and not in the slightest bit accurate.

The estate agent valuations also tend to be rather optimistic to be honest, as they want your business. If they want to market it at £250k, then a realistic selling price is perhaps £225k to £240k.

A surveyor would give you a more realistic valuation of the property. In the interest of fairness, I'd book a RICS surveyor to come and value the property. I think it will cost around £250.

And yes, having to do work to sort out damp would put a lot of buyers off, not to mention a 1 bedroom flat has a very limited market.