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The nervous wait to exchange....

Discussion in 'Home and Garden' started by noj, 3 Apr 2014.

  1. fastwunz

    Mobster

    Joined: 12 Jul 2005

    Posts: 3,557

    RICS valuations take full account of comparable evidence of sales over a recent time period and also take full account of current market conditions.

    just because people want to pay more does not in any way make the property worth it.

    Comparable evidence is the only way of correctly valuing property in line with the RICS Red Book.

    There are big issues especially in the south where people are getting into bidding wars and then paying vastly over market value for properties.

    you should thank the surveyor for protecting your wallet not moan about it.
     
  2. PermaChanged

    Mobster

    Joined: 19 Jan 2006

    Posts: 4,037

    Precisely! The only way we could pay what our original offer was would be to massively eat in to the capital which we have set aside to renovate the property.

    My gripe is with the estate agents for allowing the property to go on the market for the price it did originally - we're talking a price disparity of £60,000, not an inconsequential amount of money!
     
  3. Bug One

    Capodecina

    Joined: 18 Oct 2002

    Posts: 10,964

    Location: Sandwich, Kent

    Surely, a property is worth what people are willing to pay for it.
     
  4. Buffman

    Sgarrista

    Joined: 4 May 2007

    Posts: 8,057

    Location: West Midlands

    Correct.
     
  5. PermaChanged

    Mobster

    Joined: 19 Jan 2006

    Posts: 4,037

    Not in a banks view, they will only lend against the actual value of the property, not what you're willing to pay.

    It's fine if you're a cash buyer, a royal pain in the butt if you need a mortgage.

    EDIT: If the survey had come back and there was only a £10k disparity between our offer and valuation, we wouldn't lose the house for the sake of that - £60k on the other hand..... We're not prepared to be mugged off by the vendor and pay extortionate amounts.
     
  6. b0rn2sk8

    Sgarrista

    Joined: 9 Mar 2003

    Posts: 8,225

    That doesn’t mean it isn’t worth that amount of money. It just means banks have a lending criteria and a risk profile that they are willing to lend under.

    The intersection of demand and supply are what determines the price. The reason I said what I said is because if you just look back through this thread houses are generally going for way more than their formal valuation. Those people are having to make up the difference in cash, especially in Scotland with their system of closed bids.

    The point of the valuation is to protect the banks position to stop odd anomalies where people are paying substantially more than similar properties but if houses are consistently going for more than their valuation then the valuation is out of step with the market.

    The bank ultimately doesn’t want to be in a position where they lose money in the event you default, factoring in the chances the market drops in the near future.
     
  7. PermaChanged

    Mobster

    Joined: 19 Jan 2006

    Posts: 4,037

    See here; https://www.overclockers.co.uk/foru...it-to-exchange.18591082/page-86#post-34901498

    It does mean it's out of line, and is an anomaly, and therefore not worth the money.
     
  8. bJN

    Mobster

    Joined: 23 Nov 2009

    Posts: 3,556

    Location: Norwich

    Spoken to actual solicitor today (possibly first time?); All being well we should exchange tomorrow morning and he'll start submitting all the required documents to Help To Buy and chat with the developer and set a completion date. I'm hoping Tuesday next week, but I'd take Wednesday. So long as it's not Thursday onwards as I'll be very peeved at having to fork out for stamp duty - albeit a very a small amount at £1750. Last I saw of the house (weekend just gone) it seemed it just needed flooring and turf...
     
  9. Rids

    Soldato

    Joined: 30 Sep 2008

    Posts: 6,663

    ARGAHASDHAASDHAAHFFFFFFFFF!

    Estate Agent is not returning my calls, seen another property we want to look at listed by the same agent that was involved in our deal that fell through. Bit more expensive, going to have to go cap in hand to my family for about 10k but the place is in much better shape than the one we were looking at previously so would need to next to no decorating so affordability over the first 18 months is broadly in line.

    I'm guessing the agent has had an offer on this place and is stalling us, either that or I upset him on Friday when he broke the news about the other place falling through, but I was very clear that my frustrations were not with him.
     
  10. ci_newman

    Sgarrista

    Joined: 24 Feb 2004

    Posts: 9,727

    Location: Hook, Hants

    My nerves are turned up to 11 today! All buyers in the chain are ready to exchange and all deposits / funds etc have been transferred but the solicitor at the bottom is dithering and hasn't passed on the contracts to the next in the chain! We're really on a knife-edge for completing in June.
     
  11. ci_newman

    Sgarrista

    Joined: 24 Feb 2004

    Posts: 9,727

    Location: Hook, Hants

    FYI the mortgage companies have all set a deadline for today to have "fund requests" submitted to guarantee release of funds before 30th June. I'd be pressing your solicitor some more :)
     
  12. Ahleckz

    Capodecina

    Joined: 7 Nov 2009

    Posts: 18,336

    Location: Glasgow

    And her buyer has pulled out. ARGH.

    Phone call to the estate agent tomorrow to get the flat back on the market. Hoping it’s nice and quick. Not sure if I’m meant to/I should tell our sellers? Don’t want them pulling out. I think we’d give up if that happened tbh.
     
  13. Peerzy

    Soldato

    Joined: 9 Nov 2008

    Posts: 6,914

    I'd certainly not mention anything to the sellers of the property you are purchasing yet and I'm sure the EA will advise the same at least in the short term. We lost a buyer and replaced them 3 days later, our sellers never found out.
     
  14. ci_newman

    Sgarrista

    Joined: 24 Feb 2004

    Posts: 9,727

    Location: Hook, Hants

    Well my chain is screwed for completion this month... my son just tested positive for covid. :( :( :(
     
  15. Vita

    Capodecina

    Joined: 26 Mar 2006

    Posts: 11,170

    Location: United Kingdom

    Had contact from the agent saying the vendor has tried to contact them but they keep missing each other. This was 2 days ago. I feel like either the vendor doesn’t want to now sell the house, or the agent is stalling for offers more than the asking price. They said they’d contact me once they’ve spoken to them but how can it take over a week to?

    It’s annoying that they can’t give a straight answer. Decided to look at some other properties now and if they fit the bill then happy days. Still can’t help but think that this is the house for us.
     
  16. fez

    Capodecina

    Joined: 22 Aug 2008

    Posts: 16,487

    Location: Tunbridge Wells

    Thats not true. Its based on their valuation of the property which is quite often nothing like the market value of the property. The only value a house has is what someone is willing to pay for it. It doesn't matter what you paid for it 6 months earlier if the market has crashed or boomed. We have had the bank undervalue both the places we bought and by quite a lot in both cases. In the first case they wouldn't budge despite giving them proof of identical and smaller flats in the same blocks going for more money than we were paying in the previous 3-6 months and the market had gone up since then.

    It all worked out OK for us in the end but banks only care about what they think they could get for the property in a pinch if it was repossessed. We were in the flat for about 3.5 years and it went from £226k up to over £300k and then back down to about £280k as the market fluctuated before we sold. We agreed £240k with the seller and the bank valued it at £210k. It was a 3 bedroom flat and you couldn't get a run down 2 bedroom for £210k and we had quite a few flats from the block to back this up.

    Banks are very much not a reliable source of valuations.
     
  17. PermaChanged

    Mobster

    Joined: 19 Jan 2006

    Posts: 4,037

    Please do explain how a RICS valuation is "quite often nothing like the market value of the property"?
     
  18. Basher

    Sgarrista

    Joined: 18 Oct 2002

    Posts: 8,983

    I guess because it's there to minimise the risk for the lender, so needs to assume that the market will be lower at the point of default.
     
  19. ChrisD.

    Caporegime

    Joined: 20 Sep 2006

    Posts: 26,434

    Completion day. We were packed up and loaded onto the vans by 11. Currently sat outside the new house while they are still packing and emptying the house… which we legally own. Fuming isn’t the word but what can I do but wait.
     
  20. ci_newman

    Sgarrista

    Joined: 24 Feb 2004

    Posts: 9,727

    Location: Hook, Hants

    I've experienced this on every house purchase I've ever made. They'll probably leave a bunch of crap in the attic and garden / shed too.