Commercial Property valuation

[lexi 1]

Hi all can anyone advise me I might be in a position to buy the commercial unit I currently rent I called the local commercial agents and asked them about coming to value it so I know roughly what its worth and was told that they will charge £1500 ! to come and value it as it has to be done formerly is that correct or are they crooks ?

Lexi

[PurpleMoonlight]

Look online for the asking price for similar properties and offer around that.

[soxboy]

If you are wanting what is known as a Red Book valuation that is to be used as a base for bank lending then that is the going rate. There's a lot that the lenders require to be put into them which does seem superfluous but that's what they want.

If however all you require is an opinion of value then you are looking at a third of that figure, it may be worth another call making clear that's all you need. They have either misunderstood or are so busy they've priced themselves out (it does happen as there is a lot of valuation work out there and a shortage of registered valuers).

[Davel]

I've just had our warehouses valued and, as a very rough guide, I think that you can base it on 10 times the annual rental as an investment figure.

There may well be many other factors that can affect this such as location, development potential, possible ground contamination so, if you're serious, it may well be worth spending the £1,500 and using the value as a negotiating tool.

[matjk]

Something to bear in mind, if you are going to pay for a valuation and intend to get a mortgage on any part of it make sure you talk to the bank first as they will insist on you getting a valuation from on of their approved agents. Find out who they use and use them or you could end up paying twice! The banks valuers will always seem to cost more than the current going rate but you have to choice

[singlecoil]

It's also worth bearing in mind that the landlord may have no wish whatsoever to sell. Many commercial properties are bought purely as investments, and there would be no point in selling unless they were going to get quite a bit more than they are worth.

[Chrisgr31]

Davel said:

I've just had our warehouses valued and, as a very rough guide, I think that you can base it on 10 times the annual rental as an investment figure.

There may well be many other factors that can affect this such as location, development potential, possible ground contamination so, if you're serious, it may well be worth spending the £1,500 and using the value as a negotiating tool.

Ten times is indeed a very rough figure but the other issue to bear in mind is that the OPs rent may be historic and therefore not a good starting point. The first thing the OP needs to do is ascertain whether the landlord would sell in the first place, as if they wont there is no point going any further.

The OP could then look instead at buying a different and moving, although that has its own costs.

[soxboy]

lexi 1 said:

Hi all can anyone advise me I might be in a position to buy the commercial unit I currently rent I called the local commercial agents and asked them about coming to value it so I know roughly what its worth and was told that they will charge £1500 ! to come and value it as it has to be done formerly is that correct or are they crooks ?

Lexi

Has the landlord indicated he would be willing to sell to you?