Using the bank valuation report.
Discussion
Had the bank valuer report on my new build house today. Valued it 5% under the agreed purchase price.
I am wondering now how to use that to screw a bit more discount out of the developer.
The valuer has said one reason he has under valued it is that only 20% of any of the plots have been sold, and he struggled to find comparisons as there is nothing similar on the development or locally. I had raised the worries about later discounts with the developer during intitial negotiations.
On the down side, we are part ex'ing with them and they gave full market value, and they have someone wanting the plot behind us in the queue. I also think they know we are pretty committed to this sale and won't walk away as we have £2k committed in reservation fees, survey fees, searchers, legal fees etc.
5% under seems quite a smalll amount based on stories about massive under valuations on new homes. I think they will front it out and I need some more arguments.
I am wondering now how to use that to screw a bit more discount out of the developer.
The valuer has said one reason he has under valued it is that only 20% of any of the plots have been sold, and he struggled to find comparisons as there is nothing similar on the development or locally. I had raised the worries about later discounts with the developer during intitial negotiations.
On the down side, we are part ex'ing with them and they gave full market value, and they have someone wanting the plot behind us in the queue. I also think they know we are pretty committed to this sale and won't walk away as we have £2k committed in reservation fees, survey fees, searchers, legal fees etc.
5% under seems quite a smalll amount based on stories about massive under valuations on new homes. I think they will front it out and I need some more arguments.
I'm not sure I would pay anything over Market Value - why would you?
I'd also be a little suspicious of someone else wanting the plot. Not many developers try and sell something they have already sold, but I have seen developers use 'Sold' signs to make developments look like they are selling.
Your position is slightly weakened by the p/ex at 100%, assuming this is 100% of Market Value, not 100% of the developers idea of Market Value...
They play games, they do...
You could always ask the developers for details of what they have sold to convince the valuer...
I'd also be a little suspicious of someone else wanting the plot. Not many developers try and sell something they have already sold, but I have seen developers use 'Sold' signs to make developments look like they are selling.
Your position is slightly weakened by the p/ex at 100%, assuming this is 100% of Market Value, not 100% of the developers idea of Market Value...
They play games, they do...
You could always ask the developers for details of what they have sold to convince the valuer...
davidjpowell said:
I'm not sure I would pay anything over Market Value - why would you?
I'd also be a little suspicious of someone else wanting the plot. Not many developers try and sell something they have already sold, but I have seen developers use 'Sold' signs to make developments look like they are selling.
Your position is slightly weakened by the p/ex at 100%, assuming this is 100% of Market Value, not 100% of the developers idea of Market Value...
They play games, they do...
You could always ask the developers for details of what they have sold to convince the valuer...
It is tricky in the sense that before they told me there was 2 people in the line behind me, the site security guard had told another resident I didn't then know over his daily coffee stop the same thing. And an estate agent who came to value my house let the same information slip out as they are selling the house of one of the people in the line. The resident I met has the only other plot where the house is nearly the same and had paid 15% more than I have agreed to pay but bought off plan and was 10% in the hole so wasn't in a position to negotiate, much as I now feel I am.I'd also be a little suspicious of someone else wanting the plot. Not many developers try and sell something they have already sold, but I have seen developers use 'Sold' signs to make developments look like they are selling.
Your position is slightly weakened by the p/ex at 100%, assuming this is 100% of Market Value, not 100% of the developers idea of Market Value...
They play games, they do...
You could always ask the developers for details of what they have sold to convince the valuer...
They are coming back to me today as I have asked for a revised price ion light of the valuation but I think they know our heart is in this purchase.
I think that is an excellent result. To be fair to the developer the bank valuer will invariably undervalue a property, mainly because it gives him a bit of protection should the valuation be called in to question in the future.
Also as the developer says they are giving you the full asking price on yours. The chances are if you were to sell it, even if someone offered the full asking price, they would be back to ask for a discount on receipt of the valuation. Mind you this does assume the asking price is one obtained from an independent agent prior to considering a part exchange!
Also as the developer says they are giving you the full asking price on yours. The chances are if you were to sell it, even if someone offered the full asking price, they would be back to ask for a discount on receipt of the valuation. Mind you this does assume the asking price is one obtained from an independent agent prior to considering a part exchange!
as far as im aware the bank will not lend you the money as the value is different to the sale amount the developer is going to have to lower the sale price
on our valuation it says house value 190K but 30K of discount has been given we paid 190k with a full asking price given for ours in px they sold it for over 10k less than they gave us as px
on our valuation it says house value 190K but 30K of discount has been given we paid 190k with a full asking price given for ours in px they sold it for over 10k less than they gave us as px
Chrisgr31 said:
I think that is an excellent result. To be fair to the developer the bank valuer will invariably undervalue a property, mainly because it gives him a bit of protection should the valuation be called in to question in the future.
Also as the developer says they are giving you the full asking price on yours. The chances are if you were to sell it, even if someone offered the full asking price, they would be back to ask for a discount on receipt of the valuation. Mind you this does assume the asking price is one obtained from an independent agent prior to considering a part exchange!
I think it's a common misconception. In reality a valuer (Internal or External) is not employed to stop deals. The banks are keen to lend, within their criteria, and don't like 'defensive' valuations. Some even ask to see the comparables, and if they do not follow through to support the valuation up or down will be back...Also as the developer says they are giving you the full asking price on yours. The chances are if you were to sell it, even if someone offered the full asking price, they would be back to ask for a discount on receipt of the valuation. Mind you this does assume the asking price is one obtained from an independent agent prior to considering a part exchange!
davidjpowell said:
I think it's a common misconception. In reality a valuer (Internal or External) is not employed to stop deals. The banks are keen to lend, within their criteria, and don't like 'defensive' valuations. Some even ask to see the comparables, and if they do not follow through to support the valuation up or down will be back...
The mortgage is only about 30% of the new house value and as long as we don't mind paying more than the valaution with our own cash the bank are not bothered. Gassing Station | Homes, Gardens and DIY | Top of Page | What's New | My Stuff