Lender down valuation of £100k!

[slugsinthegarden]

We made an offer on a house in London at£1.05M (was on for£1.1). Offer accepted. Level 3 survey showed no issues. Searches in progress. Barclays has valued it at £950k!!!!!

Mortgage broker very surprised at huge amount of down valuation. Was told it was due to comparable sale prices in last 3-6 months. From land register data the price seems reasonable but those sales are all 2+ years ago.

I've gone back to EA and asked if seller would move on price but this was on Friday evening so I'm sitting around all weekend stressing.

Anyone else had a similar situation? How was it resolved (or not)?

I agree that people ought to be aware that online estimates can be way out, whether Zoopla or whatever. They all use algorithms ( of course) which take no account of factors like has that particular house been extended, has the house been renovated, was it last sold for a bargain price etc. Research is good and I would always do lots of it myself, but the most useful research is looking at other comparable houses and what they are actually selling for at a particular time. Rightmove sold prices is a good source of information for this, albeit their data is from properties that sold about 3 months earlier. People should also view lots of other houses for sale locally in their price bracket so that when they finally see one that represents good value, they recognise it.

Good Luck @slugsinthegarden

@Wisterialane88 do you agree that the house could be only worth £717k based on local comparable properties? If so then it was very overvalued. But if you couldn’t buy anything of similar size & quality for under the price agreed, it may be worth paying for a second opinion via a proper valuation not a desktop one.

25k for renovations? Are you just painting?

Money goes nowhere when renovating.

The lower valuation is good.

The house is well-priced at 780, I feel based on what else is in the market. 717 is insulting, I feel. I’ll have my own valuation done and see what comes up.

Maybe you'll get lucky. I did. We had a second valuation with a different bank and they came up with £995 (vs our £1.05 offer). Seller "reluctantly " agreed to accept 995 yesterday as long as we work toward a quick exchange. Hoping to exchange next week. Hooray!!!

@mumda We are building a home office in a very big open plan ground floor, adding a downstairs loo and utility plus fitted wardrobes in the bedrooms and fitted bookshelves downstairs. It adds up rather quickly!

Fabulous news OP!

25k doesn't touch the sides on that list.

That would cost much, much more than 25K, although I'm not clear whether you intend to build an extension to be a home office or something else.
Hopefully you have done your sums properly!

Ooh what a good result for you 👏

Wow that worked out well! Congratulations. I will get an independent valuation done.