Reply With QuoteOriginally Posted by Scottd
I don't think that fits in with the plan, here.
I would certainly consider having a valuation done myself, on an independent basis, from either local estate agents or an alternate surveyor.
Had a similar issue myself recently where a mortgage valuation came in 20k below our offer. We changed lender and the next surveyor valued the place at our full purchase price.
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I don't think that fits in with the plan, here.
Maybe not but I think its important to understand if the initial valuation is accurate/reliable before commencing any negotiations.
In the position of the seller I certainly would not be happy to renegotiate based on the opinion of one surveyor.
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That’s not true at all. The valuation that has been done by professionals on behalf of the mortgage company has valued the house at a significant sum below what it was marketed for. Therefore the vendor will be interested if he is asked to lower the sale price, and if the sale falls through, potentially having the same valuation given for a new buyer
To be fair
It was transparent because I have shared the information I have. You could suggest I’m about to low-ball, which is a little inflammatory, or, you could suggest what you might do, if you were in my position.
D
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You say "transparent", some would say "calculating"
You've decided what you want to do, armed with your letter that says "We, the mortgager value the house at: ££££", and finally - validation from folk on here..... Carry on.
What I might do? The hints are in my posts.
But - don't go bleating if you negotiate a further reduction - only to find out on completion - that the seller has found another buyer.
As I posted earlier, let your valuer and the selling agent discuss it now.
The selling agent will want to close a deal and take their fee. If your valuer is wrong they will quickly point out other evidence or make it clear that they have other bids on the table close to your level so if you don't proceed on the terms agreed you can jog on.
If you are paying well ahead of where the rest of the market are at then they will quickly try to find some middle ground, subject to you then showing total intent to proceed.
Thanks to all for taking the time to respond. There is great wisdom and experience on this forum , and I’m grateful for you sharing it with me.
It has given me things to think about
Cheers
Dave
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I think this is good advice; it gives the selling agent and the valued (the two who’s valuations of the property vary) a chance to discuss their opinions of the property value and why they have that opinion. Either or neither party may be right or wrong; they may both agree that a higher value is correct, a lower value is correct or that the value lies somewhere in the middle.
Once you know the outcome of these discussions you’ll be in a better place to move forward and make the best decision for you.
Whatever the outcome, I wouldn’t worry about the extra (supposed) £25k; you were happy to pay that before which means that you must think it’s worth the money. Good luck with getting it sorted.
If it’s a valuation for mortgage purposes the valuer will not talk to your agent. They are instructed by the lender and lender only. It just won’t happen.
If the OP paid for a homebuyers or structural that’s different. However if that was the case the OP would have an in depth report and a detailed explanation which will include why he values it as such.
As I said previously, as long as the lender confirms they have no issue then it will happen. In fact it happens all the time.
Separately the OP has already confirmed
Every mortgage valuation we have had done (3 over the years) has been lower than the purchase price but we worked on the basis that the valuer would err on the side of caution and carried on with the purchases as we had agreed. We neither bought nor sold at peaks or troughs but over the years each house sold for more than we paid for it, so not unhappy with how things worked out in the longterm.
I would agree with this.
Valuers are usually independent and don't go looking to undervalue. They research recently sold comparables and base their valuation on their findings.
The bank I work for and many others now do not allow valuation challenges simply because the % of cases being overturned is so small it's not worth wasting everyone's time. There are exceptions as described above but these are becoming rarer and rarer
Come on that's a bit different. The valuation is only required so that the mortgage company can offer a mortgage (which they are still doing in this case). it's one person's opinion with a degree of risk taken into account, 2 surveyors could give 2 completely different opinions, whilst the vast majority of solicitors would identify if the deeds are either correct or not.
If you bid and won a lot at an antiques auction could you then go and get an experts opinion to argue to the auction house that you should pay less than you bid? I get that there's no legal contract in the case of a house purchase yet but that doesn't make it right to try to get the house for less than you offered.
When you make an offer to buy a house you take into account how much you think it's worth, how much you want it and how much you might need to offer to beat any other potential buyers. Going back 6 weeks later and saying we want to pay less than we offered is a bit rich IMO. The seller could have had other buyers lined up who would've happily paid above what the surveyor is saying it's worth but if they pulled out of the sale now they may lose the house they are buying.
Last edited by watchcollector1; 25th June 2018 at 09:22.
At the moment around a fifth of properties are being down-valued, and the market is so slow you can’t always find enough comparables to challenge it. Even when you do, the banks don’t accept it and there’s no reasonable process to argue the point. I don’t accept that surveyors are all-knowing professionals having recently met a mortgage valuer for NatWest who was a complete idiot, in a hurry to get in and out as quickly as possible, and with no knowledge of the local market. He picked a figure that appeared to have been based on mouseprice.com, which was completely wrong. In some cases properties are becoming unmortgageable on the basis that they would be impossible to sell, which is insane when the reason for the valuation is that at least one offer has already been made.
It seems many valuers are factoring in the risk of a fall due to Brexit, and don’t want to get sued by the lenders if it happens and they turn out to have overvalued, so their valuations are somewhere between defensive and absurd. This is wrecking a huge number of deals at the moment and making price falls a self-fulfilling prophecy.
I think one factor is how long you are likely to be in the house. We bought our family home in 2000, and probably overpaid by about 5-10%.
Whilst I was agonising over whether to try and push the price lower, a wise friend told me that if it seems unlikely that I would find another in a similar place/price I should just go ahead and secure it. Since then, all three kids have been to the local school and we enjoy being a part of the community.
After a decade or more, the odd 5% or 10% on the purchase price matters a lot less than the fact that the place is a family home.
Of course, if the house is in an area where there are many similar options, this might not really apply.
Best wishes,
Martyn.
On our current house we paid full asking which may have been over paying although we wanted it and isn’t want to miss out to save 10k
Mortgage valuation came back at what we paid though so may not have been too far wrong
In terms of the OP’s situation I would say try and meet somewhere in the middle but don’t miss out on the house if it’s the one you really want
Not true in my experience. For remortgages, yes there are down valuations mainly due to over inflated estimates by sellers. For purchases through an estate agent I don't see many down valuations at all unless they are large HMOs where owners have considered an investment valuation rather than normal market value.
Your experience may differ, but this is my recent experience, and that of my Estste agent and solicitor. Maybe it’s a regional thing, this is certainly happening in London where prices are slipping.
Of course there are instances where the valuers get it wrong and could be the case here and for yourself.
I copied the OP's text to my BIL (Building Surveyor in England, who does many valuations)
"It all depends on how keen the purchaser is to buy and the vendor is to sell. Values are slipping downwards at present in many areas so mortgage valuers are becoming more cautious, as they don’t want to get sued for a negligent over-valuation should the lender repossess in a few years and take a hit on what they’ve lent, which can of course accelerate the downward spiral."
HTH
As a closure for this thread, I thought I might report back.
The issue was a valuation 5% below our offer price, which caused us some disquiet and also upset the mortgage deal by changing our LTV. We revised our offer to split the difference, something the vendors agent felt was reasonable and were supportive of.
I’m relieved to say the vendors agreed to this, and I’m hoping we will shortly be able to exchange. Paying a small percentage over valuation was ok, as the house was worth it to us, as was the ability to move on with life and cease renting two flats.
So I hope that is it, and thanks again for those who were so generous with their advice and experience.
Dave
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That sounds like a good result Dave. I hope the purchase goes through smoothly and you're able to enjoy your new home in the near future.
ATB
Jon
On the "it doesn't happen" theme...
https://www.bbc.co.uk/news/business-44202542There has been a "significant" rise in homes being valued at less than what buyers have agreed to pay, the UK's largest mortgage advisers have said.
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