In many parts of the UK, home prices are on the rise. However, down valuations are proving an obstacle to home ownership and are causing headaches for some buyers.
In many parts of the UK, home prices are on the rise. However, a serious obstacle to home ownership is causing headaches for some buyers. Down valuations – whereby a mortgage lender’s valuer will value a property at less than the amount the buyer has agreed to pay for it – can force buyers into paying thousands of pounds or risk their deal falling through.
A recen tnews report from the BBC revealed a significant rise in homes being valued at less than their sale price, which can cause significant problems for buyers. This so-called ‘down valuation’ means that home buyers must pay thousands of pounds to make up the difference in order to save the deal – or risk the entire sale falling apart.
How to avoid down valuation
Even though down valuations seem to be on the rise, there are some things smart homebuyers can do to avoid the disappointment and frustration of a low valuation.
1.) Choose a local surveyor
A home surveyor should know the local property market. This is the best way to ensure a sound, accurate home valuation.
2.) Show evidence
If a property valuation comes in too low, a good estate agent will provide the surveyor with up to date supporting documentation to show the value of comparable homes in the area.
3.) Make a show of good faith
A significant deposit – at least 30% – can often demonstrate to a surveyor that the buyer has confidence in the value of the home.
4.) Enlist an estate agent’s help
When a home value comes in lower than the sale price, an estate agent is the best person to deal with the surveyor to explain mitigating factors. If possible, have the agent present at the valuation proceeding to avoid problems before it is too late. Get in touch with one of Strutt & Parker’s expert estate agents, who would be delighted to advise you today.
5.) Try again
If a down valuation truly prevents the completion of the sale, it may be possible to request a new survey using another approved surveyor. There may be an additional charge to the buyer, but in the end it could be money well spent.
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