Firesale Bank Valuations?

G’day…

Be aware that Real estate Agents do not give a Valuation. They are supposed to give you a “Market Appraisal”. The difference between an MA and a sale price is generally 90% to 94% of the MA is achieved in a Sale.

Agents tend to tell the Vendor what he/she wants to hear to get the listing. So take most (not all) MA’s with a grain of salt. Other Agents don’t do any research and are totally incompetant.

If you find a good agent they are worth there weight in gold and can make/save you tens of thousands of dollars. Trust your gut feeling.

Bank Valuations are vbased on comparitive sales ie Properties sold..not the asking price.

Cheers

Bill

Bill O’Mara
Real Estate,Mortgages,Share Market Strategies.
[email protected]

I recently had a market appraisal that was spot on my own estimate after watching local prices for six months. Then the bank did a valuation for re-finance and came within 4%, which is OK.

However the bank valuer asked me if it was a new house, (it was a renovation of a 27 year old house,) and then he asked me what style was it. I said it was “contemporary” when built but that was 27 years ago. I suggested he say “modern”, which he wrote down.

It seemed like the bank’s guy had not done many valuations, so I showed him the agent’s appraisal and he more or less gave the same figure in the end. Go figure!

I too have had problems with getting a valuation done actually twice, and after emailing phil jones’s partners here is what i was told to do to get a fair valuation.
when buying an IP put a clause in the bid saying that neither the vendor nor the RE agent are to tell the valuer the asking price. Arrive on the day of valuation and if he wants to know the purchasing cost tell him that its still under negotiation and you just want to know what its worth as you are worried about over paying.
the other problem i had when refinancing my PPOR was that there were no units built from the same materials or design in my street. In fact nothing had been bought or sold on my street for at least a year, to the valuer “guestimated” how much it was worth. I gave him copies of what 2 bedroom units had sold for in the area ie a 2 block radius but he still undervalued by about 30,000 dollars. I cant really complain, i bought the place 3 years ago for 55,000 its now valued at 150,000.
any one else have any idea how to get a fair evaluation i would love to hear it!

We had huge difficulty with a recent valuation. We have a 3 bed townhouse, two bathrooms right on the beach/lake (limited views) which was valued at 170,000 after a total reno. We were totally shocked and queried the valuation – aparently because of the lack of properties and the fact that if you manage to grab one in this sleepy seaside town then its better than winning lotto, he had nothing to compare it to to value it against, hence the low valuation. The front 2 bed unit 1 bathroom no garage no courtyard but with views just sold for 300,000! So if there have been no sales of similiar properties in the area then be prepared for the shock. It was lucky that we were only using the equity and the 170,000 valuation covered what we wanted to borrow easily. HG

HGWells, look at the good side.

If you get a low valuation then use this to get the vendor to accept a lower selling price.

Pisces133

yes i do see your point, the problem is you make your money when you buy, so although it does seem wrong to want the valuations low when we buy, at the end of the day we are all running a business and sometimes i guess thats just the way things must be.

Doesn’t Soloman say, ‘the buyer says its too much, then walks away and boasts of the low price he got it for’

Chris (:

Kay Henry

Yep! I think if you aim for a win-win situation in all negotiations then you will get a good name and accoding to the same book, a good name is better than silver and gold (:

Chris