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Original poster

Help! Downvaluation on our house

88 replies

bigbird1234 · 27/10/2023 16:22

We are trying to sell our house (large 4 bed semi) because we want to move closer to family in another city.

We had accepted an offer slightly below asking price and things were progressing well. However, now the buyer has now been in touch to say they have had a £75k down-valuation from their mortgage provider, meaning that they wont be able to get enough funds.

What do we do? They are saying they can't consider another lender as the rates are not affordable for them elsewhere and they can't raise the cash shortfall.

Do we stand firm to original price and risk losing the sale? With house prices dropping, my fear is that we'll lose out on this offer and that most buyers will come up against the same barrier (they have a decent deposit so that isnt the problem). DH says we will be able to find another buyer but I am less sure...

Advice please!

OP posts:
K10f1 · 27/10/2023 22:02

A house I wanted to buy was down valued last year. It had gone to best and finals so my eventual “winning bid” was over asking. I couldn’t make up the short fall between what the bank were willing to lend and what we had agreed. I had to reduce my offer back to the price it was valued at (which was in fact the original asking price). They declined after about 10 days of making their mind up. They didn’t sell the house to any of the other interested parties, presumably they all had the same problem, and are still living in the property (small village so awkwardly we see each other about). Rumour has it they plan to try again after doing some building work on some of the land. Meanwhile I bought another house, for more money than I was going to spend on the first house before it was down valued, but this time the bank agreed the valuation so there we go.

There’s no easy answer but I really wasn’t messing about when I reduced my offer. I wanted that house and in theory could afford it, the bank just didn’t agree and there was nothing I could do about it.

Lose10kyesterday · 28/10/2023 10:48

moonbeamsokay · 27/10/2023 20:24

Given the difference, it might be worth engaging your own surveyor to see if they agree with the downvaluation. Get someone independent - don't rely on your estate agent, or anyone they recommend.

If they think it's worth more, then consider remarketing it.

But if they more or less agree with the buyer's lender, then I'd say take the hit. You might find another buyer who doesn't need a mortgage and doesn't bother to get their own independent valuation, but it's unlikely.

Sound advice, I'd do that if I were you, @bigbird1234, that could maybe help resolve the discussions between you and your DH, as well?

Unicorn2022 · 28/10/2023 11:08

I doubt they would engage with the idea of getting different valuers or mortgages as there's no benefit to them. If someone told me that the house I am buying is worth £75k less than I agreed to pay then I certainly wouldn't be paying the whole amount.

If it was me I would tell them that I can't drop the whole £75k but would be willing to drop £50k. They can get the extra money out of their deposit. Instead of having a 25% deposit on a £535k purchase they would have a 25% deposit on a £485k purchase. They might be willing to do this but would be mad to pay any more money than that.

smartiesneberhadtheanswer · 28/10/2023 11:50

Do not bully your buyers into paying more. This happened to me many years ago and then several weeks later we still had such a bad taste in our mouths from being forced to over pay to prop up agents valuation that we pulled out.

Changeychang · 28/10/2023 12:14

Presumably you had more than one estate agent give you a valuation for sale. What figures did the other agents provide?

cultureplanet · 28/10/2023 12:19

smartiesneberhadtheanswer · 28/10/2023 11:50

Do not bully your buyers into paying more. This happened to me many years ago and then several weeks later we still had such a bad taste in our mouths from being forced to over pay to prop up agents valuation that we pulled out.

Bully?

Surely it’s just negotiation

did you vendors get your head in a lock or something?

smartiesneberhadtheanswer · 28/10/2023 12:24

@cultureplanet

It's a long story but honestly we felt bullied and lied to by the end.

CrashyTime · 28/10/2023 15:14

Unicorn2022 · 28/10/2023 11:08

I doubt they would engage with the idea of getting different valuers or mortgages as there's no benefit to them. If someone told me that the house I am buying is worth £75k less than I agreed to pay then I certainly wouldn't be paying the whole amount.

If it was me I would tell them that I can't drop the whole £75k but would be willing to drop £50k. They can get the extra money out of their deposit. Instead of having a 25% deposit on a £535k purchase they would have a 25% deposit on a £485k purchase. They might be willing to do this but would be mad to pay any more money than that.

Why should someone eat into their hard saved deposit when the house is obviously worth 75k less than the seller thought? Only 14% off in this market is a gift, if I was the seller I would grab it with both hands.

ArborealArdour · 28/10/2023 17:39

Pepper12345 · 27/10/2023 19:52

I find it strange that they won't let you see the report.

We're selling at the moment and the buyers' mortgage company did a surgery and valuation. They were happy to send it on to us and we met the buyer on site to go through every item on the survey and agree what we would do and what we wouldn't before the sale. Luckily they agreed with the agreed sale price, which was a bit below the asking price (6%).

I'm not aware of any reason for the survey not to be shared so it might be worth saying you're willing to continue negotiations subject to them sharing the valuation just to see if it will get conversations started. I may of course be wrong.

Not all banks share the report - mine didn't. Just the final figure, and it was an in-person valuation with one of the big 5 , middle of last year.
When queried - policy to not share the report, down valuation or otherwise (our price was accepted, but that's what we were told).

topnoddy · 28/10/2023 17:46

smartiesneberhadtheanswer · 28/10/2023 12:24

@cultureplanet

It's a long story but honestly we felt bullied and lied to by the end.

Well you were dealing with estate agents !

Heronwatcher · 29/10/2023 10:07

I had this in my last house, mortgage company of my buyer undervalued by more than yours. The reason was that the mortgage company had done a drive by/ compared to recent other sales and didn’t realise that my house had a massive garden compared to others on the street but also house prices had risen more than their algorithm in my small area. I held firm and the buyers had already made up the difference because they had a decent deposit, they just had a higher LTV. Incidentally prices have continued to rise so I think the buyers have done ok- they didn’t overpay.

This was though when houses were selling quickly in my old area- we had 4 viewings before it went on the market so I was confident we could sell to someone else. Did you have other offers before this one?

CrashyTime · 02/11/2023 16:10

Yes, having other offers will give you some leverage maybe?

CrashyTime · 03/11/2023 17:14

How are the negotiations going OP?

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