Bank valuation

fashionista88

Hi guys,

Just looking for some advice from those in the know on this forum. Stay with me while I give as much detail as I can!

So I am approved by PTSB for €180k,originally started looking and bidding on properties in cork city but kept getting out bid on 2 and 3 beds. (Some reaching 200k+!
Realising I was out of my price range, I looked further afield out to county areas. And have found a property I want to buy. Final phase of New build in an already established estate in county 20 mins from city centre)
It's a 4 double bed, 3 bath, semi d, corner site in a cul-de-sac. One of 13 others being built in an estate that was started in 2007 but not finished. Our 13 house block would finish the estate. All footpaths, lights etc are all done already and the other 50+ houses in the original estate are occupied.

The asking price was €179,500 and I've managed to get a few extras from the builder (better spec kitchen, sanitary ware,paved driveway, patio area etc )which made it a sweeter deal after the disheartening 6 months looking at 2nd hand homes in the city.

Now comes the problem! All is good on my side, engineer was happy, solicitor happy, deposit was paid. Life insurance sorted, Contracts not signed yet. Final hurdle to getting the full letter of approval from the bank was their value going out and making their report.

The valuer has come back at €20k under the agreed price (155-160k), citing that there are no comparable properties that have sold in the area to warrant the higher price. The bank now are obviously not allowing us to go ahead. I have done my own digging on the PPR and yes, the highest price that a property in the estate sold for was €155k, however this was an 8 year old property, middle of the row, which required work to complete( I believe it needed a new kitchen as it had been stripped out, and the gardens were like a building site) there were others sold in 2014 and 2015 for 120k, 130k as they were NAMA sales.

My question is do I have any options? Or do I have to walk away from what would have been a fantastic first home because the valuer is using examples of houses sold under duress and unfinished houses as our comparisons for the bank?
Developer has already stated that there is no room for dropping the asking price. He has many interested parties.

Any advice welcome, thank you for reading a long post! Have had an awful day dealing with it all!

BertyytreB

Can you hire an independent valuer and then see if there is a difference? If the independent valuer agrees that your potential property is the same price see if the bank would except this.

StanleyOllie

Find out who is on their panel of valuers. Phone one of them and explain your situation. A valuer has to justify why they have valued a property at a certain price. They are under scrutiny as to how they come up with prices. There could be similar properties in another location a number of miles away. What have the other properties in the block of 13 gone for?
Other option is to look for alternative way to borrow the 20k. Any nice relatives that would gift you that amount.

fashionista88

Thanks for the replies so far!

We are the first to pay the deposit on this new block. The prices are the same for the rest of the houses, and most have deposits on them. We just happen to be the furthest down the line to buy it, so no comparable on the ppr for this block yet.

I have no chance of getting the extra 20k from anyone. I've worked so hard to have 25k in savings as it is to get the deposit and fees covered.

Can I get the list of valuera and get a second opinion? Do you think the bank would allow that?

Would it be worth applying to another bank altogether?

SB_Part2

This happened me. The valuation came in at 20k less than the purchase price.

We had to change banks.

Water John

the valuation was done for the bank. You should ask them have you a right of appeal. If so, and you should, then you should ask would the appeal system allow an expert to make a submission on your behalf.

I think the suggestion above of changing banks might be a good idea. Chase a number of options at the same time. I know that its stressful but keep your eye on the end game for you.

fashionista88

So the update is as follows!

I rang two other valuers on the Ptsb list today and they told me verbally just by my description that the asking price sounds like it is a fair price.
One had sold a 3 bed this month, which needed a lot of work for 155k. So said for a brand new 4 bed on a corner site, the asking price was right. he will do the valuation for the bank if they allow him, ye bank manager didn't answer any of my calls or his calls today!

Really unhappy with the Ptsb customer service. Between losing paperwork and lack of communication it's a disaster!

Going to AIB in the morning to kick off another application to give us another option too.

Thanks for all the advice so far!

Water John

You seem to have been unfortunate.

You'll find all finance sources a pain. Always a glitch somewhere but stick with it.

SB_Part2

fashionista88 wrote: »

Going to AIB in the morning to kick off another application to give us another option too.

Thanks for all the advice so far!

Don't mention anything about the previous valuations.

L1011

If there are other interested parties, I cannot see changing banks as workable - this is not an instant process and they will be aware of the previous queries to your credit file at the very least and likely ask for details. If the EA actually has other interested buyers the property will be gone. Your new banks first pick of valuer could be the same person, too.

Trying to refute the valuer is about the only option. However, you need to decide if this is a good idea. The economy is at risk of falling off a cliff at any moment due to Brexit etc; house prices in the UK have already started falling despite just as tight a supply of properties and so on. If the valuer says you're paying too much you need to really reflect and decide if you *are* paying too much.

fashionista88

There are no there are no other parties for my particular house. There are 13 for sale. 3 still remain unsold so the builder has given us time to get sorted out.

As previously mentioned, 3 other valuers have disagreed with the initial valuation done. He has basically valued our 4bed corner site, as the exact same as a 3bed mid row with work needed that sold I the last few months. Even to my untrained mind that sounds Bonkers!

The guy that completed the valuation for Ptsb is not on aib's list so no worries of getting him again.

L1011

You said there were other interested parties in the first post?

The valuer may be pricing risk in that wasn't there when the 3 bed was sold. Trying to push valuations to get loans was one, of many, things that drove us to the brink last time around. If you can get multiple other valuers to value it higher so be it but apply extreme caution.

fashionista88

Interested parties in the estate... I.e the builder will not drop the asking prices on the house to match any lower valuation. He has taken deposits on 10 out of the 13 houses available at that price.

Apologies if I did not make that clear enough.

Interestingly enough, after speaking to the builder in the last hour he has told me that the auctioneer that came out to value the house for the bank, was originally meant to be selling the houses for the builder but the builder went with another local auctioneer instead and the first guy was quite put out at the time.
Possibly just a coincidence, however seems very funny to me!

fashionista88

L1011 wrote: »

You said there were other interested parties in the first post?

The valuer may be pricing risk in that wasn't there when the 3 bed was sold. Trying to push valuations to get loans was one, of many, things that drove us to the brink last time around. If you can get multiple other valuers to value it higher so be it but apply extreme caution.

In fairness, if you put in 4 bed properties in county cork less than 20 mins to cork city, that require no work whatsoever you will find nothing out there at less than the asking price that we have agreed on. It's a brand new build!

And the fact that 3 other valuers who have no allegiance to me have disagreed with his opinion also raises questions for me!

SB_Part2

L1011 wrote: »

If there are other interested parties, I cannot see changing banks as workable - this is not an instant process and they will be aware of the previous queries to your credit file at the very least and likely ask for details. If the EA actually has other interested buyers the property will be gone. Your new banks first pick of valuer could be the same person, too.

Trying to refute the valuer is about the only option. However, you need to decide if this is a good idea. The economy is at risk of falling off a cliff at any moment due to Brexit etc; house prices in the UK have already started falling despite just as tight a supply of properties and so on. If the valuer says you're paying too much you need to really reflect and decide if you *are* paying too much.

The other previous queries on the ICB can be explained. Just say "I was going with that bank but your bank has better rates/customer service".

The valuer will more than likely not budge. And if two valuations are presented the lower one is taken.

Having gone through something similar my only option was to go with another bank and play dumb.

fashionista88

***update***

So I made a compliant re the first valuation so PTSB sent a second valuer out after 3 weeks of back and forth.
At the same time I applied with AIB as I was unhappy with PTSB customer service.
Both valuations came back today.
PTSB: 180k
AIB: 185k

Goes to show the first valuer was talking out his behind.
Letter of offer due out early next week.... Anyone having issues stick with it!!!

Water John

Great news. Best wishes with it.
Why do tools like this make life difficult for people?