House saga continues...

RedvGreen

RedvGreen

RedvGreen

Soldato
Joined
2 Dec 2009
Posts
4,012
Location
Midlands
So, with our buyer's surveyor undervaluing our house by £40k, they are using that as an excuse to offer far less. This is irrespective of the buyer offering asking price straight off the bat - almost as if they knew it'd be undervalued.

Doing some digging around rightmove and zoopla leads me to yet more confusion however.

We live in the posh postcode area of our town - we are actually on the cusp of North Yorkshire, and by comparison, our area is the nicest part of an industrial grim town. Yet, within this town, there are central postcoded houses which are valued about £70-80k more than our house, which offers less space, no garden, no drive, no garage, no fittings, and bad postcode area.

Our road has around 70 houses, and about 10 of them are valued at £400k up to £800k. Our parish is also the most furthest area of our town, and is often seen as the poshest part. Typically, Doctors, Consultants, Directors, Business owners and professionals live in our area, and on my street.

Our house is a detached 3-bed with a huge plot for the area - far bigger than any other houses on our road.

The previous properties to sell on our road have been either the mansion-ish ones for their crazy sums of cash, or repossessions/desperate finance moves (no normal house sales for 10 yrs, as people are quite content living here).

The repo and finance generators sadly sold for whatever mortgage was remaining on the property and no more. This lead to nearby houses selling for insultingly small sums like £85k.

This leaves our house realistically and comparably needing a value of £270k, yet we cannot get an estate agent to agree to anything more than £235k. Surveyor came back and valued £210k on the basis of no like-properties existing in the area, and the previous sales being low.

So there we have it, a huge bag of confusion over prices. Any ideas on how to proceed?

We cannot honestly proceed to move anywhere unless it involves a downgrade in area (we were looking for an upgrade which would be attainable with the typical £270k price), downgrade in square-footage, house, quality and fittings/decor.

Any idea why our road/area is being downgraded and far smaller, more industrial houses are being valued for far more?
 
If they don't offer the money you want, turn down the offer and wait for the next offer (or buyer). It's no surprise the buyers want to pay as little as they can.
 
Steampunk said:
If they don't offer the money you want, turn down the offer and wait for the next offer (or buyer). It's no surprise the buyers want to pay as little as they can.
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The issue isn't just the buyer, it is the surveyor they used which valued it way below our asking price, and about £55k below what my £/sq.ft computes to.

The fact is, would further mortgage surveyors value for the same?!
 
RedvGreen said:
The issue isn't just the buyer, it is the surveyor they used which valued it way below our asking price, and about £55k below what my £/sq.ft computes to.

The fact is, would further mortgage surveyors value for the same?!
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Get in 10 more surveyors or estate agents and you'll get 10 different prices. Houses (like everything else) are worth what people will pay for them. Opinions of various interested parties can be wildly wrong.
 
RedvGreen said:
The issue isn't just the buyer, it is the surveyor they used which valued it way below our asking price, and about £55k below what my £/sq.ft computes to.

The fact is, would further mortgage surveyors value for the same?!
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maybe, but the survey is only for mortgage purposes ie if a bank values a house at 200k on a typical 80% ltv they will only lend 160k for that house. If a buyer has enough of a cash deposit to swallow the difference they just move to a higher ltv product or stump up the cash for the difference
 
Tricky position, the only way you will convince the surveyors to change their minds is with weight of evidence and unfortunately you are in a position where you have none. It looks to me like the only way this can proceed at this point is a compromise but that won't get you your 270K to make the next step.
 
How do you come up with the value of £270k over the estate agents value of £235k?

You cant just do a simple £/sq.ft equation when it comes to selling houses, particularly relatively unique houses.
 
Can't see you getting anywhere with the current buyer, you could find out who their mortgage lender is and get an approved surveyor on their list to come out and do a survey (at your cost). If that comes in higher (quite possible particularly if you tell them your summation as per op) then go back and say you disagree with the original surveyors valuation and present your survey.

Mortgage valuation survey is circa £130 from memory in our area.
 
I don't think you're going to have much luck unless it's a cash buyer. If the mortgage company doesn't think it's worth the price then the buyer wont be able to proceed.

You can hope that the next buyer goes with a different mortgage provider who comes up with a different valuation.

On the plus side, the fact that someone met your asking price straight off means your valuation can't be a million miles off (unless the buyer is a moron and willing to pay over the odds :D)
 
Well the problem here is that if a valuation comes below your agreed price, then the buyer is going to have to pay that money out of their own pocket to the lender just to get the mortgage. Thankfully our valuation came in only 2k below our agreed price, which the vendor agreed to drop the price by.
 
Unless someone came out to survey your house they are likely using a very basic Halifax price index valuation (%change and adjusted base value) based on historical sales of properties in the area. On average this is normally fair, but in areas of extremely low sales this method of valuation is very inaccurate. You could be doing yourself a massive help by getting a professional survey done. Might cost you a few hundred £££ but if it justifies an asking price of thousands of ££££ more its a worthwhile thing to do.
 
Have you had any previous offers close to your asking price? The reason I ask is to determine, irrespective of what you and a surveyor think, how much people might be willing to offer for your house. Also, how many estate agents have you contacted? Where I'm going with this is if you are getting a lot of interest near the £270k mark then at least you know the price stacks up OK versus other property in the area in the minds of buyers.

That said, the fact you can't get any estate agent to agree to market the property for over £235k worries me greatly as it implies possibly one of the below to me:

1) Your property isn't valued as highly by 'the masses' as much as you and the prospective purchaser think (houses can be quite subjective, and people have a tendency to overvalue their own properties because the cosmetic side of things [decor etc] will be to their tastes)
2) The estate agents simply can't see the value in the property relative to other things they've seen and sold, which is surprising assuming they've been round to check it out and it is as good as you say
3) The sort of money you want for a 3-bed just doesn't stack up i.e. the agents have 4-beds on for say £250k and they just don't get people coming in the door saying they want to buy a 3 bed for £270k, because they know they can get a 4 bed for less (NB I'm well aware that a good 3 bed may be bigger/superior to a 4 bed but that is still how many people approach house-hunting). This sounds unlikely, given what you've said.
4) The fact a lot of properties have sold 'cheaply' on your street leads them to believe that the status quo is actually a bit lower.
5) They know that people won't be able to get a valuation at that sort of level and for the majority of people paying massively above a valuation is either impossible (due to mortgage issues) or unappealing.

If there are all these repossessions going on on your street that may also rightly or wrongly set alarm bells ringing for some buyers/surveyors i.e. they will be thinking OK, if these houses were such great value then why did they need to be repossessed rather than simply being sold, you said yourself they were sold at the value of the remaining mortgage which implies that they can't have been worth massively more than the remaining mortgage otherwise people could have sold them easily to clear the mortgage.

The fact that houses have been sold 'cheaply' on your street, for whatever reason, may also influence buyers i.e. if a comprable house to yours is listed with land registry as sold for or £200k or less in the past couple of years then they are not going to be queuing up to pay £270k for yours because they will be worried about whether that value will be retained.

I can understand the frustration but ultimately in scenarios like this where there is little data to work with it may be difficult to convince everyone of the property value. My father lives on a similar street in the sense that most people are happy living there and only one property has sold (twice) in the past 18 years so it is quite difficult to work out how much his house is worth given he bought it over 30 years ago.
 
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HangTime said:
Have you had any previous offers close to your asking price? The reason I ask is to determine, irrespective of what you and a surveyor think, how much people might be willing to offer for your house. Also, how many estate agents have you contacted? Where I'm going with this is if you are getting a lot of interest near the £270k mark then at least you know the price stacks up OK versus other property in the area in the minds of buyers.

That said, the fact you can't get any estate agent to agree to market the property for over £235k worries me greatly as it implies possibly one of the below to me:

1) Your property isn't valued as highly by 'the masses' as much as you and the prospective purchaser think (houses can be quite subjective, and people have a tendency to overvalue their own properties because the cosmetic side of things [decor etc] will be to their tastes)
2) The estate agents simply can't see the value in the property relative to other things they've seen and sold, which is surprising assuming they've been round to check it out and it is as good as you say
3) The sort of money you want for a 3-bed just doesn't stack up i.e. the agents have 4-beds on for say £250k and they just don't get people coming in the door saying they want to buy a 3 bed for £270k, because they know they can get a 4 bed for less (NB I'm well aware that a good 3 bed may be bigger/superior to a 4 bed but that is still how many people approach house-hunting). This sounds unlikely, given what you've said.
4) The fact a lot of properties have sold 'cheaply' on your street leads them to believe that the status quo is actually a bit lower.
5) They know that people won't be able to get a valuation at that sort of level and for the majority of people paying massively above a valuation is either impossible (due to mortgage issues) or unappealing.

If there are all these repossessions going on on your street that may also rightly or wrongly set alarm bells ringing for some buyers/surveyors i.e. they will be thinking OK, if these houses were such great value then why did they need to be repossessed rather than simply being sold, you said yourself they were sold at the value of the remaining mortgage which implies that they can't have been worth massively more than the remaining mortgage otherwise people could have sold them easily to clear the mortgage.

The fact that houses have been sold 'cheaply' on your street, for whatever reason, may also influence buyers i.e. if a comprable house to yours is listed with land registry as sold for or £200k or less in the past couple of years then they are not going to be queuing up to pay £270k for yours because they will be worried about whether that value will be retained.

I can understand the frustration but ultimately in scenarios like this where there is little data to work with it may be difficult to convince everyone of the property value. My father lives on a similar street in the sense that most people are happy living there and only one property has sold (twice) in the past 18 years so it is quite difficult to work out how much his house is worth given he bought it over 30 years ago.
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The house over the road from us sold for £290k about 10yrs ago. The house next door to us sold for £85k (mortgage repo) 6yrs ago. All these houses are the same generation and style, except ours has about 3x larger plot than both.

I've checked houses further up the road and due to a woman passing away, it sold for £170k as the old guy needed to go into a home asap.


My valuation is based on like-properties and their prices in far worse areas than where i'm at currently. They are in central town surrounded by state-owned tenement flats with constant trouble from gangs etc. We are based positively rurally in comparison.

We had quite a few valuations, ranging from £190k - £255k, however, the higher valuations were done by EAs with a bad reputation (although which one is actually honest?!), so we opted to go for one with a good rep.

Funnily enough, our own mortgage surveyor just 3 months ago valued ours at £265k which he said he usually values about 5-10k lower to be sure that the property value can be reacquired in the event of repo.
 
Ask them to get a mortgage valuation done by that same surveyor maybe, then if he comes in well under you could at least go back and query why the difference in just 3 months.
 
RedvGreen said:
The house over the road from us sold for £290k about 10yrs ago. The house next door to us sold for £85k (mortgage repo) 6yrs ago. All these houses are the same generation and style, except ours has about 3x larger plot than both.

I've checked houses further up the road and due to a woman passing away, it sold for £170k as the old guy needed to go into a home asap.
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Something doesn't add up here.

If the properties are 'similar', as you describe, then the range in variation is absolutely huge, even accounting for quick sales, or repossessions.

If a 'typical' price 10 years ago was anywhere near £290k, then I just can't see why the other two places would sell for so much less, unless something else caused a huge down turn in demand for the area? Has there been an airport built in your back garden?!

I'd be very surprised if there's much you can do to change the valuation - as the small amount of data that there is, doesn't back up your expectations. The only positive point I can see, is that if your houses true value is higher than the EA valuation, then there will still be a demand for it and so you should achieve close to the price you want. The downside is that the demand (at the higher price) is slightly reduced due to the way mortgages are offered, which will price some people out, when they otherwise might have been prepared to offer closer to your asking price, had the valuation been higher, allowing them to borrow more.
 
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