House valuation.

[Rowgtfc72]

My dad died last August leaving his house to my brother and I. We were doing it up to sell but decided to crunch the figures and realise we might be able to afford it.
We have had a valuation on the unfinished property but my brother is unhappy at how low it is and that as its leasehold with only forty years left on it, we would have to purchase the freehold and this would then be taken from the valuation before the value was split between my brother and I.

Obviously my mortgage provider would have to value the house but would they be able to tell me this so I can use this as a valuation for my brother? Would I have to get a different valuation but then pay again for my mortgage provider to value it?

Hi Row - it is really unlikely that anyone will lend you money on a house that only has a 40-year lease (and, therefore, very unlikely anyone will buy it unless it is a cash buyer getting an absolute steal). Does it also need work because you mention it is "unfinished"? I know the story of the way your dad passed away from another thread that I sometimes visit and I know you've mentioned your brother there too - I think he is just going to have to suck up the low valuation. Invite him to have it valued by as many estate agencies as he likes or get an auction house in to give an idea (the most likely way a house that has these sorts of drawbacks would sell is at auction which generally has lots of cash buyers).

If you can find a mortgage provider to lend against the house then, yes, they will give you a written report that includes their valuation - generally quite a lot more conservative than estate agency guestimates.

Before you do anything, you will have to find out if the freeholder is willing to sell you the freehold or extend the lease. If you decide to go ahead with buying your brother out, you should definitely only pay your brother half of what the house is worth as a property with a 40-year lease, not half of what it could be worth if it converts to a longer lease/freehold. I've extended leases/sorted out freeholds a few times so, if you think I can give you more specific advice, PM me.

Good luck.

Thanks for that! Have chased the freehold people today and they're very busy bit getting back to me with a quote in the next few weeks. Sorted another house valuation for Tues. Estate agents have just sold a property needing the same sort of work as dad's but its freehold selling for ten thousand less than the first quote we got. Looking forward to breaking that news!
First estate agent said we take the value of the house, then take off the cost of buying the freehold ( solicitor is holding funds for this) then split the remainder between us. So if the freehold is expensive and the valuation is low....well, it won't go down well!
Thanks again for very useful info. Much appreciated!

Sorry. Meant to say hi back and yes I remember you from the other thread!

Right, so the money to pay for the freehold is coming out of your dad's estate? In that case, I can see why you would divide the price as you have outlined - I assumed that you were paying for the freehold so you would be making all the contributions to the house's uplift in value and your brother would just be riding in your slipstream.

Yes, I can imagine that you are going to have to have some difficult conversations with your brother but, if he won't believe you, let him get some other valuations in (make sure any agency he uses provides comparables).

He's not interested in sorting anything out himself, he's not local so has expected me to do it. I will take the inbetween of the two valuations.
Have kept the solicitor informed all the way and copied him into all e mails. I've played it nice and nows the time to tell him how it will be, the house has been empty for a yr in august. My dh has done most of the work on it.
Plan is valuation ,arrange to buy freehold,finalise mortgage( bank says they don't see a problem as it will be for less than we owe on our house now) get in writing from brother that we can move in before ours is sold( he has promised to do this) put ours on the market. We should have 20k equity in ours.
He's still thinks once the freehold is bought then that value is added to the house, not taken away. He also hasn't grasped how worthless the house is with only 40 years left on the leasehold!

He's a dick. Carry on as you would if he weren't involved just cc'ing him and solicitor in on everything and give him the appropriate amount of money at the end. If he wants more, he can pull his finger out, get some valuations done and find out that there isn't any more to be had. Make sure that you have a paper trail so you have evidence of all valuations etc. Iirc, you don't live in a property hotspot - if he does, it may be that he just doesn't realise how cheap properties can be outside the honeypot locations.

Good luck - I hope you're really happy in your new home and it marks a positive end to the horrible way you lost your dad.

Thanks for that!
You seem to know my brother so well!
Always leave a paper trail with my brother.