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Surveyor downvalued our property - no explanation given, what can we do?(32 Posts)
I hope someone can help me, we've found a gorgeous property that we love in the perfect area.
We agreed a price (the sellers came down considerably from their original asking price, over 10%), and started the mortgage process.
The property is fairly unique, grade 2 listed, but other (larger) properties in the same complex have been sold at higher prices, for their original asking price.
The mortgage surveyor has downgraded the price by a considerable sum, which basically means that we can't afford to buy the property (I'm not asking the seller to come down further, it wouldn't be fair and it isn't right - the house is definitely worth what we've agreed to pay, in fact we're getting a bargain).
We're getting a second survey (the vendors are paying half), but do we have any comeback against the original surveyor, I want to see his comparables etc but I'm told by his firm that he doesn't have to provide anything over the valuation.
This is setting us back and costing us money, I'm really unhappy about it.
I hope this makes sense, hopefully someone can advise.
god sounds a nightmare. Is it just a very difficult house to value?
As you did not employee the surveyor, your mortgage company did I will suprised if he will talk to you. We have just had a survey done for remortgage perposes and we don't even know how much our house was valued at, just that the % LTV was in the bracket we required so we know roughly how much.
You say it is grade II listed, could this be the problem ? As I personally would not go anywhere near a listed building. Maybe if the mortgage company had to get shot of it quickly then this could cause problems ?
You could always try a different lender, therefore a completely different surveyor. I know this is more money and time wasted.
Surveyors and industry professionals base all their calculations on price per sq meter (or feet), not sure why estate agents and the public don't use the same method as it saves a whole lot of hassle, guessing and estimating for everyone. That way you could easily find out £/sqm for property in any given location and then add or deduct for extra features or repairs.
Based on the above its unlikely that the surveyor has got it wrong - perhaps repairs are needed and grade II repairs are more expensive than standard houses.
I spoke to the surveyor when buying my house. They were refusing to value it without certain info. So I spoke to them at length to find out what they wanted and to disagree with one thing they wanted as it wasn't necessary.
It can't hurt to try and talk to them.
In our case our surveyor did downvalue our house. Which I also thought was ridiculous although could appreciate the difficulty in valuing a project. We did not remegotiate as we knew they could sell it at that price.
We reduced our borrowing (so have less of a budget to do the work) but have retained our 60per cent mortgage. We could have borrowed the same and got different rates, agreed to do work and have additional funds released later or tried to negotiate the price. They were our options.
I agree that it is the bank's valuation, not yours, and therefore the surveyor doesn't need to speak to you to explain the reasons (but may do so). As regards comparables, it is worth asking whether he included the other property in the development, but you must recognise that the valuer is at liberty to choose whichever comparables he thinks are the most useful. It is usual now to only refer to completed sales, and there is a time lag between sales actually completing and them being formally reported at the Land Registry etc. It may be that he can't use it, if he can't get access a written record confirming the sale price.
I read on the money saving expert website a while ago that this is very common. Apparently, if the bank repossess the house and lose money, the surveyors are the only party who can be sued for losses. I should stress, I read this, I don't know this myself.
Obviously, if this is correct, surveyors will be extremely cautious with valuations so they cannot be held liable if the bank loses money.
Maybe he is doing you a favour. I wouldn't see a surveyor down valuing a property as a bad thing!
thing is he doesn't have to answer to you, he doesn't have to answer to you and he doesn't have a contract with you and therefore may not want to speak to you incase at a later date something he says comes back and bites him on the bum as he wasn't paid by you.
I would get your own survey done and pay for the full survey and look and see what that says - then decide whether you proceed. I wouldn't be sharing the cost of the survey either but paying the full amount - if I liked the house enough.
"The surveyor must have reasons". I agree, but he hasn't told the mortgage company and won't speak to the mortgage advisor.
I swear I'll update when we get the results of the next survey - no matter what the outcome
ivykaty44 It was suggested upthread that I should call them to discuss......... but thanks for your input.
I am covering the cost of the mortgage survey, but I don't think that's quite the same thing as being the client.
I'm now curious about the next valuation.
The surveyor must have reasons. We had a house surveyed which we ended up not buying because the survey was so far below the price we'd agreed to pay. We were cash buyers but that can work against you, in that the seller knows you have the money, and you can't use the excuse that the bank won't lend you the higher amount, etc.
if the other house was sold only 2 months ago it is probably not showing on LAnd Reg website yet and surveyor may well not have had access to that info. suggest the vendor tells the second surveyor about the other sale when the surveyor comes round!
why would a surveyor speak tp you? you are not paying him so why would he speak to you?
it would be a bit like you calling a solicitor and asking for them to give you advise as your neighbour has been dealing with them over the same problem and your neighbour is paying their bill, so you thought they could talk to you as well and give you advise but you aren't paying the bill iyswim
I agree with the other posters. There is very little comeback on a basic mortgage valuation. It is done on behalf of the lender but you cover the cost.
I would be very surprised if the valuer is prepared to speak to you. As others have said, he is acting on behalf of the lender.
If you want a survey/valuation carried out where you can have a discussion with the surveyor then you should be having a more indepth report carried out.
It is odd that the surveyor won't speak to the bank. When I worked for a (commercial) bank we often had instances where we wanted to lend against a property, but the surveyor came back with a valuation that meant the figures didn't work. I would often challenge them on behalf of the customer, but don't remember a single instance when they couldn't fully explain their reasoning.
Thanks myron, if there had been anything specific then we could have dealt with that by reducing the price according to whatever required fixing.
Unfortunately it's all a bit woolly, there is no specific reason.
Thanks everyone for your answers, as far as I can tell from the advice we have no comeback on the surveyor, but I will call him tomorrow to discuss the valuation (he refused to speak with the mortgage advisor - hopefully I will have more luck).
OP, the more I read the more I think you completely misunderstand the whole valuation process. Just because a similar house sold for more money a few months ago does not mean that it or your house is actually worth that on the open market (it obviously was worth that amount to those specific buyers however). It's possible that those buyers wanted a much smaller mortgage or no mortgage at all didn't care what the bank's valuation was.
Anyway this is the bank's valuation and presumably you are having your own full survey carried out? What is your surveyor's opinion?
You would be mad not to try to negotiate with the seller based on the surveyor's valuation.
This happened in our first house purchase. We paid for a 2nd survey and the valuation still came in under the agreed sale price. In the end, the seller agreed to split the difference and fortunately, we were able to stump up the extra but it was a stressful first time buy for us.
We also had a valuation 2 years ago where it undervalued the house we wanted to buy AND it recommended that the mortgage offer hold a retention of £30K conditional on substantial repairs being made. That was a shock to the system because the repairs weren't obvious. We didn't proceed with the sale after paying for a full structural survey plus an independent timber survey which confirmed that there were substantial and costly repairs required (that we hadn't noticed due to lots of cosmetic touch ups!) We walked away due to doubt plus the fact that the seller refused to enter any price renegotiation due to the house being 'unique' which it was.
The house is not "definitely worth what we've agreed to pay" if the surveyor has valued it at a lower price.
LOL "As the mortgage is an 80% mortgage I doubt that the mortgage company would not get their money back, but I accept that this is his job."
How do you think people got into negative equity in the last 2 recessions? 80% is a massive mortgage and it really doesn't take much of a downturn before the bank might not get it's money back, especially if it was overvalued to begin with.
If the house is unattractive as a place to live in winter, then that is very material to the value of the house. Even is only a % of people would feel that way, it does affect the value, by making it significantly less saleable.
IMO, you should listen to the expert and adjust your offer.
Comparables are difficult, due to the house itself, however there is a house in the same development, which was sold 2 months ago by the same estate agent, for the valuation the estate agents originally gave which is more than we have offered for this house.
So I'm confident that he didn't check that house out.
As the mortgage is an 80% mortgage I doubt that the mortgage company would not get their money back, but I accept that this is his job.
"It also makes it more likely that you or other buyers are prepared to pay a premium for that kind of property. It doesn't mean that the house is actually worth that much money." I would have thought that's exactly what it means, any item is worth exactly what people are willing to pay for it, including any premium.
How do you know he hasn't done his job properly? What are you going to do if the second surveyor comes back with the same value? What kind of damages do you think you could claim for - at the moment you seem to have little evidence that he didn't do his job and only your subjective opinion that the house is worth more.
On what basis are you saying that he didn't check comparables? Do you have some evidence of this? You said yourself that the house is unique, rural and Grade II listed which makes it more difficult to value accurately. It also makes it more likely that you or other buyers are prepared to pay a premium for that kind of property. It doesn't mean that the house is actually worth that much money.
As a bank surveyor valuing for the mortgage, his job is to ensure that in the event of a forced sale the bank can recover the money they have loaned to you.
Telling the current owners that he wouldn't want to live in that house in winter doesn't mean it had any bearing on his valuation, it was a passing comment.
Have you called the surveyor to discuss? Have a chat - usually they're very happy to discuss any questions.
but it is a subjective view , all valuations are to an extent plus looking at market, similar local properties and saleability (ie would the location deter buyers if the bank had to resell). If he'd said this is idyllic and upped the value you wouldn't be complaining !
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