Registered Valuation

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gcorgnet

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Topic # 87204 22-Jul-2011 12:52

Hi,

Not sure if there are any expert here but I am about to order a registered valuation on a property I intend to buy an the owner after offering to recommend someone casually mentioned that it would be a good idea to mention the purchase price to the valuer, to "help things along".

I understand their interest in that (I might withdraw the offer if the valuation is too low) but was wondering if anyone had any thoughts on this? I obviously don't want to pay too much for the property but a higher valuation might help things for the bank to approve the financing...

Thanks,

Gui

trig42

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Reply # 496654 22-Jul-2011 13:03

I have had about 4 RVs done over the years, and everytime I needed the property to value up to what we had agreed to pay, and I let the valuer know, and miraculously the properties always valued up to what we needed them to.

I am not a lawyer by the way.

If you want the house and have agreed a price, then you need the RV to come to that price or more. If it doesn't then the bank wont lend on it (I'm assuming the bank is making you provide a registered valuation). You can get out of your contract (so long as you have a correct clauses in the S&P agreement - ie being able to obtain finance suitable to the purchaser, not just being able to obtain finance because you possibly could get finance from another more expensive lender and the vendor could force it) but you will be down the cost of the RV (about $450 to $500?) and any lawyers fees.

It is foolish to not want the RV to come up to your agreed price, after all you have decided you like the property and agreed a price with the vendor that you are happy to pay.

gcorgnet

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Reply # 496659 22-Jul-2011 13:07

Thanks for your reply.
You make a good point here.
The only reason I am asking is that if the valuation was way off under what I am about to pay, I would probably want to know. After all, I am no expert at guessing what a property should be worth.

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Jaxson

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Reply # 496661 22-Jul-2011 13:10

As above, it depends on what you want out of it, but it doesn't hurt to mention it if you want the property. It's also going to depend on the valuer themselves etc and what value their process arrives at. It also requires you to have been semi realistic with your purchase price offer.

The bank only lends a percentage of the purchase price or the registered valuation, whatever is the lower. If it comes in $5k short then you'll have to stump up with the extra cash (if you can) to complete the deal. If it's a standard house then you're fine but it can be tricky if there are no comparable property sales in your area etc.

Good luck, all the best!

Jaxson

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Reply # 496662 22-Jul-2011 13:11

gcorgnet: expert at guessing

trig42

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Reply # 496663 22-Jul-2011 13:12

That's true, but if you have been looking for property, you will know if one is too expensive. If this one you are looking at is overpriced, you probably would not have even looked at it in the first place as there will be a better house for cheaper in the same area.

It is nice to have the RV, it generally makes you feel pretty good about your purchase (as it should for the price!).

Is this a private sale?

gcorgnet

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Reply # 496666 22-Jul-2011 13:13

trig42: Is this a private sale?

Yes, it is.

trig42

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Reply # 496671 22-Jul-2011 13:22

gcorgnet:
trig42: Is this a private sale?

Yes, it is.

Then you should be getting a good deal, private sales should be cheaper than agency sales because the vendor does not have to be paying the Agent's fees.

If there are comparable sales in your area, you could find that the valuation comes out higher than what you are paying (assuming of course you did your homework and found this house which is a good deal).

gcorgnet

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Reply # 496677 22-Jul-2011 13:26

trig42:
gcorgnet:
trig42: Is this a private sale?

Yes, it is.

Then you should be getting a good deal, private sales should be cheaper than agency sales because the vendor does not have to be paying the Agent's fees.

If there are comparable sales in your area, you could find that the valuation comes out higher than what you are paying (assuming of course you did your homewaor and found this house which is a good deal).

Well, from the other property we have seen, it seems like a good deal but it is sometimes hard to judge with emotion getting in the way.

Also, trying to find similar sales in the area can prove challenging, especially considering that some street are MUCH nicer than other neighbouring streets.
Any tricks?

trig42

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Reply # 496682 22-Jul-2011 13:27

The valuer will know the tricks (so long as it is one who regularly values in your area).

Just let him know how much it has to value up to (even tell him you have offered a little more than you actually have)

Jaxson

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Reply # 496698 22-Jul-2011 13:55

trig42: Then you should be getting a good deal, private sales should be cheaper than agency sales because the vendor does not have to be paying the Agent's fees.

Or the seller just keeps the cash for doing the work themselves.

I had a valuer try to say the house was worth less because it was a private sale. I got quite annoyed at that as a house has a market value and that should be quite separate to how it's being sold.

bazzer

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Reply # 496807 22-Jul-2011 16:27

This is one of the silliest things I've read today. It makes a mockery of the "valuation". Of course, the whole things a bit ridiculous because somethings only worth what someone will pay for it, and you're prepared to pay the amount.

Are people really saying that registered valuations can be swayed by what you offered/paid? If so, are they worth the paper they're written on?