valuation survey came back too low, what now?

[TheVeryHungryPreggo]

Our valuation survey was done last week and we have had to chase for the results - it's downvalued the property by a huge amount. The amount we can borrow under the new value is still not enough to complete the purchase.

This happened us before a few years ago where the survey reduced the mortgage by 10k, but we managed to come up with that. In this case, the value is £150,000 less which is the biggest downvalue our broker has ever seen. We can't magic up that kind of money! We thought it must be a mistake but the surveyor genuinely thinks that is the right value. I know this is a huge difference, and the starting price is high enough - but it's in London, in the catchment area for two excellent secondaries and a good primary, with a long garden and close to a mainline rail station which are the biggest attractions for me and DH. I know the house itself isn't fantastic and needs an upgrade, but the amenities nearby are really important to us and houses in this area don't come up often, so we are really keen not to abandon it.

Is there anything we can do?

I know what they paid for it but that was a) 15 years ago in London and house prices have changed substantially since then and b) they built on an extension that doubled the size of the house, so unfortunately that's not going to be terribly useful as a comparison.

Anyway, it's all academic now - our own flat has fallen short on the rental valuation and we just can't bridge the gap. Hey ho. Time to drop and drop the price until someone wants it, and look again in the New Year. Shame about the perfect schools.

Oh no, what bad news!

If it is such a desirable area why has this property been on the market for a while. And if there is so much interest why was your below value offer accepted?

It sounds over priced to me.

Seems the bank is just not willing to lend the amount you ask against this property. it's very annoying for you but they have to protect their interests. Does this indicate a bit of a slowing down of these inflated prices. That would be my guess. But I suppose it's all a matter of opinion and what people are prepared to pay. At the end of the day it's the bank's decision what to lend. You could try another bank or BS. Could you release any equity on your flat. I wouldn't take that risk personally but it could be an option.

Basically it was overpriced to begin with. The zoopla estimates are about 300k over the asking price based on sold prices in the area. And the seller started off quite high.

The price dropped to the current asking price (we eventually agreed on just below) a week before I saw it and by the time I viewed it they had had a number of viewings - by the time I went back for a second viewing there had been two other couples who had also done a second viewing. So that's the explanation for long time on the market + lots of interest.

I don't think it's too surprising that it's been on a while. It's been a very very slow summer here especially with the general election just before. We've had the same issues with our flat and one other property we bid on was on the market for 8 months as it happened; three or four potential buyers madly wanted it but couldn't sell their own properties. One of them eventually beat us to it.

Pay no attention to Zoopla!

Vivienne in light of my last post I would agree that it does indeed seem to indicate a slowing-down of inflated prices!

Good news for some, bad news for others if vendor doesn't agree, and I think in our case he won't. And more bad news for us because we can't sell our flat to make it worth moving!

It's interesting how we all (well most) want the ridiculous over-inflation of London/SE house prices to end however when the surveyors actually try to do this buy stating a property is only worth x buyers and sellers are going no, no, no it's worth z really truly it is.

We have got into a crazy situation in this country haven't we

My DH is actually a surveyor working in London; I've read him this thread and he has one question - who's the agent? (Is it Foxtons?)

Agreeing with PPs who've queried how you know there are other offers on the table, and why there is so little movement locally (few properties sold locally is a bit of a red flag for surveyors; no matter how perfect the area, there is almost always movement - especially in London - unless there's another reason that the properties aren't selling).

(Sorry, just realised that was a very factual post and not very sympathetic! OP, all that aside, really sorry to hear it's fallen through; house hunting sucks and I hope you find your perfect solution soon)

Thank you Starspread. No, the agent isn't Foxtons, it's a 2-branch firm in SE London. They seem to have a decent reputation from what I can tell.

There is a good bit of movement, it's a popular area - but it's basically a high-value home set on a small patch of other high-value homes surrounded by lower-value homes if you get me? Like for a short length of the road, there are houses on only one side with forest/park/schools on the other side/to the rear, and they're 4-5 bed, detached with nice big gardens, and then you've got developments of standard-size 3-bed Victorian semis for the rest of the road and on adjacent streets. So the comparables close by in the same location are harder to find.

On the other hand, I am using Foxtons (and others) for myself - and am currently on the market for £200k below the initial Foxtons valuation on my place (which we didn't even start at because we thought it was way too unrealistic)! Considering dropping it another £100k just to get out now!

The absolute worst thing is, I'm going to have to rehome at least one of my cats. I had hoped being somewhere with more space would give him some stress relief, but he's not doing well here with baby and toddler and I don't know how long it will take until we can move. That's the hardest part. it's cruel to him to keep him here, he's so unhappy.