House down valuations

[landy george]

This has just happened to me with the sale of our house  was going to be 10k but got away with 5k drop in the end.

https://www.bbc.co.uk/news/business-44202542

[Lloyd90]

Why you angry about it?

Did you have to accept a reduced price from the buyer? You could have refused and told them to pay the full agreed price ... some people will use this as a ploy to try and knock a few thousand off the sale at the end... (most likely won’t though). 

 

 

End of the day,  It’s up to the bank what they think it’s worth and what they’ll lend... 

If someone wanted to lend hundreds of thousands off you wouldn’t you want to ensure the security is actually worth what the person is claiming? 

 

[tiny tim]

Same with me valued £15000 under but the house I am buying did the same so after negotiations cost me £5000

[oowee]

Just what you don't want close to completion. What part of the country? 

[oldypigeonpopper]

hello, seems like a reverse to the gazumping fiasco,

[tiny tim]

South Manchester...the only plus is that it’s ok if they value your house low and value the one your buying low as well..it drives both parties down

[landy george]

We had the option of lose 10k and put it back on the market to still get the same amount . Lucky they wanted it that much we agreed on 5k. The market is slow at the moment but we live just north of London so people moving out of London can get a bigger house for less money so still selling at the moment 

Edited July 23, 2018 by landy george

[Vince Green]

Its a ploy to try and lend the buyer a top up loan at a higher rate of interest, They won't give the buyer a mortgage of £x but they are prepared to give a mortgage of £x-10k and lend the difference as a personal loan. For which they get an arrangement fee surprise, surprise !

Funny how its always £10k? There has been discussions about this (mal) practice in the financial press

Edited July 23, 2018 by Vince Green

[Munzy]

4 hours ago, Vince Green said:

Its a ploy to try and lend the buyer a top up loan at a higher rate of interest, They won't give the buyer a mortgage of £x but they are prepared to give a mortgage of £x-10k and lend the difference as a personal loan. For which they get an arrangement fee surprise, surprise !

Funny how its always £10k? There has been discussions about this (mal) practice in the financial press

That’s interesting as BBC were reporting it today as a sign of a market slowdown and correction.

Edited July 23, 2018 by Munzy

[oowee]

3 minutes ago, Munzy said:

That’s interesting as BBC we’re reporting it today as a sign of a market slowdown and correction.

Sounds more likely to me. Plus greater bank caution as market tops out? 

[Rewulf]

8 hours ago, oowee said:

Sounds more likely to me. Plus greater bank caution as market tops out? 

Sounds like a bit of both to me , banks exploiting possible market slowdown, by offering tailored loans to cover the shortfall.

Seems funny how it's nationwide, whilst some area markets are still obviously very strong.

[ferguson_tom]

Our house was down valued by the mortgage valuation but we found out the person doing it didn't know the area very well and the part of town we were in was worth at least 10% more than everywhere else. We decided to pull it from the market, put it on 6 months later and got 10k more than our original asking price with no problems from valuations.

[Cant hit them all]

in my honest opinion house prices are overvalued anyway  these days estate agents over value them as more they sell them for more  money they make. and only things selling in my area are people who are willing to take a 10 to 20 grand offer less than asking price. 

[Lloyd90]

On 24/07/2018 at 21:15, Cant hit them all said:

in my honest opinion house prices are overvalued anyway  these days estate agents over value them as more they sell them for more  money they make. and only things selling in my area are people who are willing to take a 10 to 20 grand offer less than asking price. 

In my area most houses are selling within a week ... 

[henry d]

My daughter sold her house at close to the asking price and the valuation must have been good as there was no quibble from the buyers, she has been living with my sister for a few months and just put in and had accepted an offer that was 13K under the 110K OIR price. The valuation is under her offer by 5K, it does however allow her further negotiation as there are a few problems picked up by the surveyor.

I wonder if it is a "topping out" or that estate agents are trying to push prices upward

[Thunderbird]

There are two housing markets at the moment. The junk on for nearing £50-100k more than it will sell for, and the stuff that is selling in the background as soon as it hits Rightmove (or before). 

One thing I've also noticed is the 'fixer-uppers' seem to be advertised no cheaper than the ones needing no work. Was a time when the rule of thumb was that the refurb cost was about two-thirds of the price difference. 

In a rising market, yes, but Estate agents won't try and push prices upward if the trend is downwards, instead they'll do all they can to get sellers to drop.

[henry d]

2 hours ago, Thunderbird said:

One thing I've also noticed is the 'fixer-uppers' seem to be advertised no cheaper than the ones needing no work. Was a time when the rule of thumb was that the refurb cost was about two-thirds of the price difference.

Strangely I was with my daughter when she was looking at the house she has put an offer in on and prior to that we visited another which had a hell of a lot needing done, but bigger rooms and they were similarly priced.

Its a timely thread as we hope to move, dahn sarf, in a couple of years time and the last time we moved was 1991 so being fore-warned is being fore-armed!

[Lloyd90]

3 hours ago, Thunderbird said:

There are two housing markets at the moment. The junk on for nearing £50-100k more than it will sell for, and the stuff that is selling in the background as soon as it hits Rightmove (or before). 

One thing I've also noticed is the 'fixer-uppers' seem to be advertised no cheaper than the ones needing no work. Was a time when the rule of thumb was that the refurb cost was about two-thirds of the price difference. 

In a rising market, yes, but Estate agents won't try and push prices upward if the trend is downwards, instead they'll do all they can to get sellers to drop.

 

That's exactly what we noticed when looking in the city, a house on the street would sell for say £300k, already totally been refurbished and to a high standard... next thing the house down the road that needs completely gutting and everything done is put up for sale at around £290k as they say "it doesn't need that much work"...

Basically sellers want to get as much as they can, whilst sellers want to pay as little as they can... if priced well they sell within a week here. One house we saw is still on the market 18 months on... we offered them about £70k less than asking price and ours was the highest offer... they refused and surprise surprise it isn't sold. 

[scotslad]

In scotland things are a wee but different, wotever the estate agents value it at is completely irrelevant really.

Now the price depends on the survey which has to be done before selling, which is probably a fairer way.

1 strange thing thou they don't reslly value non living spaces (so garages, paking, gardens are all essentially free)

Must admit i don't agree with it at all but seems to be the way it is (onviously someone who built a decent garage and off street parking for it not to be valued)

And also the street ur house is on can really massively affect the value as a decent % depends on wot neighbouring houses are selling for, so not so good if ur's is the best/biggest house on the street.

 

Thunderbird u are spot on with fixer upers, folk have completely unrealistic ideas on prices and the money it costs to fix a house up, be very hard to turn a house round now and make money if it needs much more than a tidy and lick of paint

[Thunderbird]

At least the Scottish system avoids the awful last-minute chain collapse. 

I have a feeling there may be a downward correction, the market feels stagnant. 

[ph5172]

I seem to find the ‘bigger money’ houses seem to flow and sell well all the time. It seems to be the first or second buy houses that sit. Not sure why.... lack of first time buyers thus leading to lack of second movers or the market prices stagnating so people who bought in the last few years are left with a house worth not a lot more than they bought it for. 

I was told a lot of people are opting to extend instead for spending almost the same in fees and costs of moving. 

Around here there does seem to be a spate of alternate living spaces - people making pantry’s or under stairs into small bedrooms or buying wooden cabins and having them installed in the garden. 

I do find some valuations are a bit hit and miss. We had one property referred to a surveyor for valuation. We had a call back an hour later it was done. Apparently a google street view and right move survey is all it was. Another was 3 weeks and involved mostly the same with the surveyor driving by and measuring the outside

not (luckily) had any downsold when selling or buying but have friends who had a down value on a purchase of 15k. Luckily the vendors dropped the price. 

The new build estates locally have just knocked 5k off their book prices and are offering 5k worth of fittings from their catalogue, this seems to be on at least 2/3 of the sites