Singing Pig

This is quite common when the housing market starts to slow down.  With fewer and fewer transactions taking place there are less comparables available and therefore valuers tend to err on the side of caution. 

As a panel surveyor with pretty much all the resi lenders i am noticing that they are becoming more aware of the BMV phenomenon and at present they haven't decidied if its going to be a good or bad thing for their business and therefore are treating it with caution.  With this in mind savvy surveyors are now starting to 'price in' any potential BMV element within the valuation based on the principle that a property is worth only what soneone is willing to pay for it.

Unfortunately all of the above has the effect of pushing prices downward.

Yeah I have to agree very much with the previous posting.

Just to add something else I get a number of enquires from clients looking to purchase BMV properties via estate agents and the problem I

Sorry about the previous post I hit the return button in error !

What I was trying to point out is that were investors are buying BMV via estate agents invariably the estate agent discloses the agreed purchase price and the surveyor then puts this figure down as the market value for the property which then throws out the calculations.

So if you are looking to find BMV properties please be careful when sourcing these via Estate Agents

Mike Fisher

Hi Mike,
Estate Agents are OK so long as there is a Sole Agents agreement with the vendor and agent.
Reqest to make contact with the vendor direct, agree price, vendor gives access to proeprty (not agent), estate agent still gets paid and you got valuation on OMV not purchase price.
Not all Estate Agents/Vendors will be happy but with the number of deals currently out there and a large number of Repo proeprties going with Estate Agents it maybe worth a try.
Regards,

Daniel Morgan
Director
Fruit Finance LTD
www.fruitmortgages.com

In my experience the vendor will invariably scupper the deal cos you are basically asking them to lie to the surveyor about the sale price. i own an estate agents and we had a surveyor from one of the largest companies sit down and interview the vendor for 10 minutes about the price and made her sign a form stating that what she has said about the sale price was true. this was a straight forward sale but imagine if you'd put mr or mrs desperate seller in this situation.

Surveyors will invariably look on rightmove / primelocation for comparables and if the property in question is on the market with an agent they'll more than likely see the house they are about to go and value, even if they've been given the vendors contact details they will more often than not ring the agent to query the details of the sale.

Hi Mate, (First we debate by text and then by forum) ;)
That’s interesting that you have had that experience when using sales direct with vendor route.
What if a tenant/third party were showing the valuer around the property, not the vendor? Surely they would not be expected to know the purchase price.
I don't believe every surveyor, though I accept some may, are sitting down with vendors and grilling them for 10 minutes.
Surely the surveyors are in no position to demand answers over sale price unless they suspect something.
They should follow the figures submitted by the buyer when at application stage, unless informed otherwise.
With regards to surveyors viewing properties on rightmove and contacting the Agent, wouldn’t this result in the Estate Agent telling the truth "the sale has been agreed direct with vendor and not through out office".
S "How much did the vendor agree?"
EA "Like i said, price was agreed with vendor"
I'm not an estate agent so not sure if there are any rules around this but would be happy to hear from you and the surveyor who posted earlier both your views on the above scenario.
I also know of a number of deals where someone else was purchasing from the Estate Agent at discount however this was not the buyer hence when the surveyor was explained the situation the valuation was higher than what was listed by Estate Agent.

I'm always willing to learn if I'm wrong.
Regards,
Daniel

Hi dan! dont speak for ages then twice in the same day!

i agree with you completely on what "should" happen...

if a surveyor was doing a survey on a tenanted property then fair enough, the tenant wouldnt necessarily know the sale price. even if they did its not for discussion between the surveyor and tenant.

9 times out of 10 when a surveyor comes in to get a set of keys from us they ask for a copy of the particulars and how much it sold for. surveyors are getting a handle on the BMV process post MX and as they are ultimately acting for the mortgage company they are justified in double checking sale prices. wouldnt suprise me in the slightest if they were under instruction to do so.

you're also right, its not every surveyor who grills vendors, it only happened the once, but this particular panel surveyor is known for downvaluing EVERYTHING - not wishing to mention any names of course. as insane as it sounds, we've had a sale fall through because the surveyor downvalued the house by a grand - in a bouyant market!!!! sale price agreed 96k, valuation 95k... go figure!

with regard to the surveyor seeing the property on a portal, if we were advertising a property, we'd be selling it, there would be a contract in place and there would never be an instance where the sale would be agreed with the vendor and we didnt know how much it sold for. there are no rules as such but common sense would tell the surveyor that something was amis.