A row of terraced houses with bay windows

Valuing your property

How much is a house really worth?

Putting your house on the market? Here’s how to make sure you’re getting the right price for your current property or new home. 

Why sellers need a fair price

Putting your house or flat on the market at a high price can deter buyers. Indeed, according to Kate Faulkner of Property Checklists, ‘Buyers today are really savvy. If you’re asking for too much, they won’t even come for a viewing.’ And if a seller does find a buyer willing to pay more, the buyer’s lender still has to ensure that the property has been valued at an accurate price before they can agree to a mortgage.

Getting an accurate valuation could save hassle in the long term. ‘If a sale falls through, it’s not ideal as you have already invested time and money in the current deal,’ explains Peter Bolton King from the Royal Institution of Chartered Surveyors.

In fact, for chartered surveyors an accurate valuation is a professional obligation. ‘The mortgage valuation is not an attempt to ‘down value’ a property from an authentic higher price,’ says Richard Sexton from e.surv chartered surveyors. ‘Surveyors have a duty of care to report accurately and independently.’

Why buyers should do their research

The amount a buyer can borrow is usually based on a percentage of the property value. If a buyer makes an offer that is too high and the property is deemed to be worth less by their lender’s surveyor, the lender may refuse to offer the buyer the required finance and the sale could collapse.

But according to Doug Shephard, Director at Home.co.uk, having a property ‘down valued’ by your lender isn’t entirely negative. ‘It’s very useful for haggling with the seller,’ he says. ‘You don’t want to buy yourself negative equity.’ So use the lenders value as a starting point for renegotiations.

How to avoid offering too much

Kate suggests sellers use property-listing websites and apps at the start to find a good estate agent. Simply search your postcode for properties under offer or sold subject to contract. The agents advertising the most sold properties will be some of the best in your area.

Previous property sale prices are also available online and via apps with a quick search. However, Peter shares a word of caution on property valuation sites: ‘You don’t necessarily know that you’re comparing like for like with this information. It can also be fairly out of date by the time it goes live as sales take many months to process. In a changing market, those few months can make a huge difference.’ Instead, information available online can be used as a starting point for valuing your property.

What if the property is ‘down valued’

As a seller, you can consider dropping your asking price. Alternatively, Doug suggests holding out for a cash buyer, if you can afford to lose the time and money spent. It could also be worth getting your own, independent valuation, or a full structural survey to see where you may need to improve your property to help increase the price.

If you’re a buyer and are disappointed by a surveyor’s valuation, it’s unlikely that you’ll be able to get an alternative. A good surveyor has access to more information than the average buyer or even estate agent, and it’s their professional duty to make an informed valuation. In this case, Kate suggests moving on: ‘If your lender down values a property you’ve put an offer on, they’re looking after you.’

A ‘down valuation’ may even prevent you from spending too much on a property, encouraging you to buy with your head, not your heart. Richard says: ‘A dream home isn’t one that’s going to plunge you into lifelong financial difficulty. Even if you’re enamoured with a property, your life in it is going to be more than the bricks and mortar.’

Is there cladding on your property?

Whether you’re seeking to remortgage a property with external cladding or looking to buy such a home, you can apply with us.

We’ll consider mortgages on leasehold homes – usually flats – with external combustible cladding which requires remediation to bring it up to current safety standards. To qualify, you will need proof that the work is being funded by the developer, a government scheme or that you benefit from leaseholder protections (included within the Building Safety Act 2022).

For more information, talk to your mortgage adviser, broker or contact us.

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