It still slightly rankles that the surveyor refused to agree the price & we've had higher repayments as a result, but we were vindicated in our feeling that this property was worth what we paid. As a seller, the alternative to either accepting your buyer's reduced offer, or agreeing a new sale quickly with a company like ours is going back on the market and waiting for more viewings. House Chain Collapse: What should you do now? The difference between those two figures is the down-valuation. A survey with valuation will provide details on major problems, a valuation, and an insurance reinstatement. To comment on this thread you need to create a Mumsnet account. We purchase homes directly from sellers, offering homeowners a quick, straight-forward sale. Negative survey results can affect the value of a property so the buyer can legally ask for a renegotiation of the price to reduce it by the repair costs to reflect its current condition. Maybe you'll end up meeting in the middle. This valuation was £20,000 lower than a local estate agent had valued the property. Oh this is bloody stressful. A down-valuation is where your buyer's mortgage surveyor values your property for less than the price you've agreed to sell it for. Back in 2018 a BBC report stated that down-valuations were currently at their highest level since the financial crash of 2008. Our quickest purchase was made within six days. Most people don't know what to do if the house valuation is less than the offer. Your offer to purchase the house remains Subject to Contract (STC) and you may change your mind at any time. Is it something for them or the solicitor to deal with?Thank you for all the advice/opinions. Please check your email address and try again, Home selling scents: The smells that could win or lose you a sale, Reaction to Nationwide Monthly House Price Index, Politicians are the least trusted profession but it’s also bad news for estate agents, bankers and traffic wardens, Gross mortgage lending hits 5-year high in February, but approvals for new mortgages falls, Lockdown has helped nearly a third of homebuyers get on the ladder, We Buy Any House: Here's how to get a quick, guaranteed house sale, Help To Buy homebuyers facing £32k interest repayment increases. The first lender’s surveyor valued it at just £330,000, while the second lender’s valuation came in at £348,000. Some mortgage lenders won’t charge you for a Mortgage Survey Valuation, and the cost will be included for free for choosing them as your provider. This equates to just over £25k below the price we agreed. I rang the surveyor and argued my case, he then re-sent his report and overnight the valuation had increased by £15,000. Unless you are sure that this would lose you the property, then it would be mad not to try. Manners - are there any you didn't know about until you were older? What next? The surveyor has now valued it at 5% less than agreed price. We can purchase your home from you directly, giving you the easiest, fastest home sale possible. At the very least, with our guaranteed offers you'll have the peace-of-mind that you can move on to your new life without worrying what the bank’s next valuation will do to your dreams. It may not cover the same elements as a home buyer’s survey and should not necessarily be used in place of a full building or structural survey. If the buyer wants to try applying for a new mortgage with a different lender in hopes of a different survey result, you have a couple of options. If you are selling a house then a down-valuation could mean that you lose the sale. As a result our LTV changed from 70 to 75%, but we could still afford the repayments. If I was the vendor, I'd renegotiate without a fuss but that's because I accept the survey as a reasonable part of the process and know that the valuation could come out under what our buyer offered.It would be so much easier if we could get in touch with our estate agent. I think given that a neighbouring property which is significantly improved has gone on at the same price and looking at sold prices, I think the valuation is realistic.We need that LTV and we need to move. EA not solicitor - negotiations on price is defo EA territory. “It is questionable whether the term down-valuation is an accurate reflection,” a RICS spokesman told This is Money. Contact us for a free valuation and offer. But won’t sell if house prices dip, Oops! Be pragmatic: If the worst happens and the surveyor down values the property you have a few options. They take a much more short-term view than lenders, valuing your property at the highest possible price that it could be worth right now, rather than what it might be realistically be worth, or what it could be worth a few months or a few years after a recession. Add this to the fact that homes are consistently selling for less than the asking price anyway, and it’s easy to see why home sellers are increasingly frustrated about the constant cuts in the price they eventually get for their property. But don't you then potentially end up with a house in negative equity?We would really, really struggle with the higher repayments. Contact us for a free valuation and offer. The results of your survey may form part of the contract specifics, especially if you require that the vendor makes repairs or alterations as the value of the property is entirely dependent on the outcomes of the report. We've sold, willing to move to the vendor's timescales and we're not unreasonable. So, definitely worth going back to the vendor. So it would only be negative equity if your mortgage was more than £170k. What happens if the survey valuation is higher than my offer? We are trying to work towards a exchange date of October 17th.The house we're buying was marketed as 180-185k and we offered 180 which was accepted. Once the buyer sees the findings, they may decide to look for a different property instead. Remember there is no such thing as a fixed value, or "what the house is worth". How desperate is the vendor to sell? A low mortgage valuation can cause problems, and your mortgage lender could ask for a higher deposit to reduce their risk. If there is a down valuation, mortgage finance can be hard to agree at the level you want. But then the area is quite buoyant. Vendor could always decide not to accept a lower offer but it depends on how much they want to start again with the whole process. If it happens to you, you’ll need to persuade the seller to lower their price. Have you got more of a deposit? Even if prices crash, they'd be unlikely to crash that far. I personally wouldn't pay more than a house is worth - remember the credit crunch where people were getting 100% mortgages? The reason this can cause problems is because the size of mortgage the bank is prepared to lend is expressed as a percentage of the purchase price or the valuation, whichever is the lower. I would renegotiate the offer you have made on the basis of the survey, the vendor won't be surprised if they know the survey has come back at £170k.You have to think about resale too, if you are going to pay more than it's worth then you have to hope that a buyer would too. (If this sounds like your position and you can't do with waiting to find another buyer, see the section near the end of this article called "Solutions for dealing with a Down Valuation as a seller". Some agents may still be willing to provide the valuation for free, under the proviso that they get the subsequent sale if a decision is made to dispose of the property. We offered 405 for a house that then got valued by the mortgage company st 380. We think the surveyor is being a bit cautious but obviously we are concerned that we offered a bit too much. A survey will only inform you of any major problems such as rot. If you think we could be your solution call 0800 133 7687 to speak with our friendly team to learn more. Create an account to join the conversation, Have your say, get notified on what matters to you and see fewer ads, This is page 1 of 3 (This thread has 63 messages.). I have to nip out for a bit. I'm not ignoring you all. A down valuation is when your mortgage lender has a valuation survey done on the property you’ve agreed to buy and concludes it isn’t worth the amount you’ve agreed to pay for it. 6. Answer. mouseprice also tracks land registry data / sales. We'll never share your data or contact you unnecessarily. A valuation prepared by a surveyor will be on the assumption of market value. Here are your options and solutions - whether you're the buyer or the seller. With down-valuations being yet another new hurdle for sellers to get over in the property market, our service may be more valuable than ever - we're happy and ready to help if you'd like to learn more. So, should the property be valued at less than the seller’s price by the surveyor, then the lender will be looking to reduce how much they are willing to loan. We'd have to use that money and live in a freezing house with no money to do any work that needs doing. This would essntially be the same although it's your own money rather than the bank's. The vendor has already had a sale fall through but the area is pretty desirable right now. There is … On average the 3-bed houses go for about 30K more, but you can't tell from the Zoopla valuations which have 2 beds and which have 3. Things that affect their valuation include: It is this final element - "the prevailing market conditions" - that can cause the discrepancy, especially when there's so much uncertainty in the world. Just remember, even if you pull one of these off and get the sale back on track, there could still be a long way to go in the sale due to the solicitors and the conveyancing, so you're not out of the woods yet. Furthermore, one of Britain’s (at the time) biggest online estate agents, Emoov, claimed that as many as 20% of properties now received a down-valuation, compared to just 5% two years earlier in 2016. If this is your position, our service may be the perfect solution. Firstly I assume that you either instructed your surveyor to produced a Home Buyers Report for you or a Building Survey including a valuation in the first instance. Their estate agent just told me they wouldn't take less, and I had to insit they asked the vendor if they would accept that.Half an hour later they came back and said yes.In our case they were BTL selling up, I think in your case you need to work out their situation.If they need the money for their move, and you can't pay it, then the chain has no way to continue.If you can both move a little, then you can meet in the middle.If you end up in the first situation, then it's worth appealing the valuation. (For example, since the COVID19 lockdown this article's daily traffic has been 4x higher than before COVID came along - reflecting how many more down-valuations are happening since the uncertainty caused by the pandemic). On the other hand, a few thousand less for a quick sale may be very appealing. So what happens if you have a valuation survey carried out on a property and the surveyor says the property is worth more than what you offered. This is bad news for you as the seller, but exactly how bad depends on your ongoing plans. One road I used to live in has a mix of 2 & 3 bedroomed terraced houses which look virtually identical from the outside. Mr Broodbank blames the surveyors for what happened. It seems ridiculous to pay more for a house than it is worth. I would drop the offer to the valuation. Not if the valuer doesn't agree and you are faced with a down valuation. We can buy your home in as little as 14 days. If a mortgage company has undervalued a property the new valuation will then form the basis of the mortgage offer they will make to a buyer; therefore, it’s likely the loan amount originally applied for will change. Sometimes the valuer may down-value a property due to genuine issues they've identified with it. Which, with no small amount of irony, the valuers also use. This means you can easily be 4-6 weeks into your agreed sale before finding out your home has been down-valued. (Unfortunately, it can be an even greater sum than this, with some down-valuations reaching as much as £20,000). This valuation was £20,000 lower than a local estate agent had valued the property. Quite simply, even if you're prepared to pay over the odds for your dream home, your lender isn’t. You've agreed a sale on your home at the full asking price, great right? We've sold our house, everything was progressing well without a hitch thus far, but I'm really worried it's all going to fall through. ... After a few viewings a young couple decided to make and offer and after some negotiation she was happy to accept an offer … If the mortgage valuation is lower than your offer price then it can affect your finance. Can you afford higher repayments? There are two options in this type of survey: to include the survey with or without a property valuation. And it'll take a while after that until they actually visit... Another delay before they eventually file their report, and yet another delay before the mortgage company reviews the report, and eventually let you know what it said. When things are uncertain, valuers tend to err on the side of caution. Am I wrong to be upset I missed my son opening his birthday presents? Even if an offer has been accepted, no contracts have been signed and … Oops! Survey valuation lower than offer, what to do? Mortgage lenders base the amount a buyer can borrow on a percentage of the value of the house they want to purchase. The vendors will have no choice but to agree. So you saw a lot of properties, found one you wanted to buy, made an offer that was acceptable to the seller but now your surveyor is claiming its not worth the value you offered? If another buyer pips you to the post with a higher offer, they might be the ones who have to deal with the headache of a down valuation whereas you go onto purchase a property with no issues and a smooth transaction. I think you need to re-negotiate. You are not obliged to renegotiate, but if you are in a chain and have your heart set on your next move, you could find yourself backed into a corner and taking a substantial financial hit. The vendor will absolutely have this again with another buyer if your sale falls through. We therefore went back to the vendor and offered 380. Estate agents and buyers might have one idea of the value of your home, but the official valuer for the bank or building society may well think differently. (I'm a valuer).But I think this is a great opportunity for you to try to negotiate the price down. Read what Mumsnet users thought of The Nue Co.'s BARRIER CULTURE range, Sign up here to test Stikins® stick on name labels, Read what Mumsnet users thought of NatWest's Island Saver game. I would recommend that you speak to the surveyor who says the asking price is too high and discuss this with him. A down-valuation is where your buyer's mortgage surveyor values your property for less than the price you've agreed to sell it for. After all the buyer doesn’t want to pay over the odds. The couple have a £155,000 mortgage so were rejected for their bank's best-buy fixed rate because it is on offer only to people with at least 20% equity in their homes. This has been the most stressful time for lots of reasons and our house move has to happen for myriad reasons. Prices range from £400 to £1,000, depending on the type of property. Really depends whether they are in a position to wait, or need to get moving. Is Zoopla the only place to find out about prices?Their valuations for that road seem to be around 160-175ish so probably right.A house just down the road which is exactly the same age, built at the same time but has an extension and is in better decorative repair with a new kitchen has just gone on for 185k. If the buyer comes back to try and renegotiate their price to a lower level, you have a couple of options. After that, it'll take a while for the bank or building society to instruct a surveyor to visit. Better not to buy at all than to buy at the wrong price. Is a Probate valuation lower than the market value? Well, this 'down valuation' (as its known) is pretty common. The difference in these two prices can mean the difference between a successful sale and the whole chain falling through. Neither are great outcomes - which is why every homeowner dreads a down-valuation. To give the other side of an opinion: sometimes surveyors are a bit more conservative than the market rate, and downvalue because they're employed by the banks. However as a purchaser it could be possible to renegotiate the purchase price to reflect the surveyors findings. How would you approach this with the estate agent? In the UK we've had a huge amount of uncertainty around the economy in recent years, from the problems resulting from Brexit, and now the aftermath of the COVID19 pandemic. This can be costly and inconvenient, and put you right back to square one. Renegotiate the price. Generally when a surveyor is messing up your plans, it is because they believe the value of your asset to be less than you do. Valuers have a duty both to their clients (the banks and building societies), and to themselves to take this uncertainty into account. "They didn't actually take a look at the property. However, this is still significantly less than we had hoped. Valuation is 170k.The mortgage dude says our options are to put down more of a deposit to retain our LTV, continue and move an LTV bracket which has quite an impact on repayments or go back to the vendor and ask them to drop the price.I am in such a tizz. We did sign on for a 5 year fixed mortgage so we'd be sure of what they were.Prices have soared since then in our area and the house is now worth about 40% more than when we bought it. The difference between those two figures is the down-valuation. If a surveyor thinks that the property is worth less than the agreed sale price, a mortgage lender will give a down valuation and reduce the amount of money they are willing to loan to a buyer to complete the purchase. We can step in as your new purchaser, buying from you directly at a guaranteed price and moving quickly to patch up your chain. It is worth remembering that this type of survey is done on behalf of the bank or building society, not for the buyer or seller. To give the other side of an opinion: sometimes surveyors are a bit more conservative than the market rate, and downvalue because they're employed by the banks. This comes as a result of lender's being more cagey about future property values in the wake of the COVID19 pandemic, as lenders and other institutions start to fear that property prices may fall over the next year. The sale price of at least three similar local properties, A knowledge of supply and demand in the local area, And an understanding of the prevailing market, We buy your home directly from you so you can. Cash House Buyers: Sell your house easily and quickly. Fast forward to 2020, and sadly for homeowners down-valuations are now even more common. We've got you covered. Down-valuations have risen over the last 3 or 4 years, and the cause ultimately is that more and more valuers are wanting to cover their backs in case property prices fall in the future. If you are buying a home and you need a mortgage, then a down-valuation is problematic and could prevent you getting the home you're hoping for. For example: If you agree a sale price of £150,000 but the mortgage surveyor only values the property at £140,000, you've had a £10,000 down-valuation. The mortgage valuation is far simpler than a typical client survey, most often known as a “homebuyers report”. I think it's all you can do because the result would be the same if you let your buyers go. What have comparative proper sold for in the last year OP? (Unfortunately, it can be an even greater sum than this, with some down-valuations … Let me explain. . We bought four years ago and the surveyor valued the house £30k less than what we had offered (which was already £10k below the asking price). We eventually compromised at 385. Try to assess how strong the market is in your area for houses like the one you're buying. Mortgage valuation survey much lower than agents valuation. While it should involve more than a drive-by and some basic background research, it will never be a thorough, in-depth assessment of the property. Of course, the surveyor will also include their estimated valuation. In many cases, the original buyers will come back to you to try and renegotiate a lower price based on the surveyor's valuation. For example, if you’ve agreed to pay £200,000 and the lender’s valuation comes back at £190,000, the property has been down-valued by £10,000. I'll explain why it happens and what you can do about it. Your options will depend on what your buyer does. We need to move and quickly. Naturally, the lenders want to make sure that their investment is protected by the value of property it is secured on. Of course, all valuations, whether by your estate agent or by the bank’s valuer, are only ever best guesses. Even if an identical house in the same street sold just last week, the influence of various issues on the realistic value of your home can only be estimated. If the area is as desirable as you say, they could be in a much better position in a few months and get a higher offer. Even the BBC covered this in July 2018, saying that there had been a “significant” increase in properties being valued at an amount less than … It's worth what someone will pay for it! This might seem simple and straightforward, but recent figures show that this is not always the case. Follow that link if you'd like to learn more about our service. Possibly OP, but very few people are willing to overpay to that extent (even the BTL brigade). If the property is deemed to be worth less by your lender’s surveyor, the lender may reduce the amount they will lend to you. "They didn't actually take a look at the property. You may end up eventually securing a higher sale price this way, but you may lose any ongoing purchase you had planned because of the delay. Please answer a few short questions to help our team. The deposit option could be doable but we're keeping a very small amount of money back from our sale for a couple of jobs which need doing immediately ie putting in some central heating. Your surveyor should answer any questions you have regarding the survey report at no extra cost. To make matters worse, down-valuations usually don't come to light until you are a long way into the process of selling or buying. Go through your solicitor but let the estate agent know too I guess? "Personal and efficient -amazing company". If yes, then you have options. Even if they turn round and say no, then you haven't lost it, if you can afford to then you just agree to pay £175k, or £180k, and choose to pay either more deposit or higher repayments.Good luck. They’re either erring on the side of caution or predicting a crash, and either way, who can blame them? To use this feature subscribe to Mumsnet Premium - get first access to new features see fewer ads, and support Mumsnet.

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