The importance of a realistic valuation
So, you’ve decided to sell your home and you get three estate agents to value your property. One says they would put it on the market for £400,000; the next says £399,000, and the third says £410,000. Which agent would you choose?
Everyone’s going to be tempted by the highest offer but it’s important to review your decision carefully. Some estate agents may be valuing the property for more than it’s worth, just to get your business. But this can come at a cost further down the line.
When your buyer’s mortgage lender sends their own surveyor to value the property, they could put a much lower valuation on it. This is called a down valuation and has happened a whopping 390,000 times in the last 12 months!
Down valuations can put the sale of your home in jeopardy – if the lender isn’t prepared to lend the amount your buyer needs, the sale could fall through. In the last year the average amount a property has been over-valued by is £7,500. That’s a lot of money for someone to suddenly find, and it may not be possible.
Lenders’ valuations are not based on the condition of the property, but take into account market evidence, looking at the economy, the local market, and recent selling prices in the same area. That’s why it’s so important to work with a local, reputable agent with a strong market presence and track record. If your home is down valued, you have a few options:
- See if the buyer can cover the shortfall
- Lower the asking price
- Ask the buyer to try a different mortgage lender
- Find an alternative buyer
Each of these options adds time, stress and costs to the home moving process – something smarthomes aims to avoid at all costs.
Click here to see why you should choose smarthomes to sell your home:
To find out how much your home is realistically worth, please call us on 0121 744 4144 to arrange your free valuation.