We explain down valuation to The Guardian
28 November 2007
As the housing market suffers its most serious bout of the jitters, nervous property buyers are already being hit with another dilemma - discrepancies between the agreed sale price and that at which the mortgage lender's surveyor values the property appear to be on the rise.
Experiences vary according to location, and valuations in buoyant local markets are tending to hold up well. That said, Tracy Kellett, managing director of home search consultancy BDI Home Finders UK, says: "I now expect the majority of offers we make to be down-valued. The tide turned at the beginning of September and there's now a very different feel to the market."
So, are surveyors really worried about a possible market crash? Kellett thinks not, saying much of the pressure to down-value actually comes from increasingly risk-averse mortgage companies. "It's caution as opposed to factoring in drops in value," she says. "Surveyors have some liability to mortgage lenders for their valuations."
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