Down valuations on the rise
Down-valuations appear to be on the rise and it is shocking agents and mortgage brokers.
Property professionals have seen an uptick in valuations for banks coming in lower. This often seems to be with little evidence.
Laura Bairstow, founder of The Mortgage Masters, spoke to Jukes Estate Agents Harlow. “We have noticed a definite increase in down valuations. This is especially in instances where the borrower only has a 5% or 10% deposit. Interestingly, we had a case this week where both the borrower and the estate agent were shocked at the extent of the down valuation. So much so the borrower opted to have an independent valuation of the property and it came in at the asking price, way above what the lender had valued it at.”
Are others experiencing the same?
Gareth Davies, director of South Coast Mortgage Brokers, said: “It’s down valuation central right now. There is a clear uptick in surveyors disagreeing on valuation figures.
“There were three cases this week where a surveyor has stated a value less than what the property was bought for in 2022. This was despite no evidence to suggest that this is happening in the respective regions.
“One client was furious with the attitude of the surveyor that came out to his house. He apparently seemed ‘hell-bent’ on disagreeing with the estimated value from the second he entered the door. He even said that the place was on the ‘lower end of the scale’! However, this is a beautiful detached four-bed place.”
Steven Hargreaves, adviser at The Mortgage Co, suggested that.. Firstly, the increase is due to the low number of properties for sale. Secondly an upturn in buyers returning to the market. Finally surveyors being very cautious based on the past 12-18 months.
He said: “We have seen a number of properties recently with multiple offers and therefore agents inviting ‘best and final offers’ means that, to secure a property, people feel they have to increase their offer beyond the asking price.
“These are interesting times and we expect more down valuations over the coming months. This is unless we have a positive upturn in housing stock, or surveyors becoming more optimistic, which will probably not happen.”
What to Jukes Estate Agents Harlow think?
Down valuations on the rise
Marketing director Geoff Flewers said: “This was a fascinating read! I was not surprised in the slightest. Firstly, if you read the comments, there are many differences of opinions. Secondly, it’s hardly surprising that in this day & age, many people have conflicting opinions. Finally, I believe it is in the main, down to overpricing”!
Sales director Lee Venables continued: “There is more than enough data available for both agents & surveyors to get accurate pricing. I cannot remember the last time we had a property down valued. This is because we value the property correctly in the first place. We show vendors exactly what their Harlow property is worth. Why would you over value? Just to get the instruction? It makes no sense because even if you are lucky enough to sell it, it will down value.”
Geoff Flewers interrupted: “Actually I do remember the last property we had down valued. It was 3 years ago and we sold a property in Brockles Mead Harlow for £300,000. The mortgage survey was done and it valued at £300,000. All was good. However, the buyer then decided to go for a 95% mortgage instead of the 85%. The new survey down valued it to £288,000. Therefore Laura Bairstow from Mortgage Masters was spot on with her observations.”
Anthony from Bolt Mortgages(https://boltmortgages.co.uk/) agrees: “surveyors all seems to value a property lower when the loan to value in higher.”