sambino Posted March 21, 2008 Share Posted March 21, 2008 http://www.ft.com/cms/s/0/a93e3ff4-f786-11...0077b07658.html “We are now experiencing property valuations coming in lower than the clients expected and lower than would be required for them to switch to a new lender,” he said. “We are having to get comparables of recent sales and appeal . . . with surveyors to give customers any hope of securing their planned remortgage.” Clients who had bought outside London two years ago could easily have lost 5 per cent of their property’s value. “This, coupled with tighter lending criteria, means they are not going to be able to remortgage,” he said. Some clients had to switch to interest-only mortgages to keep up with higher monthly interest costs. Borrowers who cannot remortgage have seen their interest payments jump by up to 50 per cent. Other mortgage brokers have experienced a similar trend. Cobalt Capital said it had noted a 10 per cent rise in the number of reduced/downvaluations in the past four or five months. Quote Link to comment Share on other sites More sharing options...
Once in a lifetime Posted March 21, 2008 Share Posted March 21, 2008 Some borrowers are being denied new and cheaper mortgage deals after finding their properties are worth less than they paid for them two years ago. Made my easter Quote Link to comment Share on other sites More sharing options...
sambino Posted March 22, 2008 Author Share Posted March 22, 2008 I hope with self certs they are also checking their earnings properly aswell Quote Link to comment Share on other sites More sharing options...
Harry Sacks Posted March 22, 2008 Share Posted March 22, 2008 http://www.ft.com/cms/s/0/a93e3ff4-f786-11...0077b07658.html“We are now experiencing property valuations coming in lower than the clients expected and lower than would be required for them to switch to a new lender,” he said. “We are having to get comparables of recent sales and appeal . . . with surveyors to give customers any hope of securing their planned remortgage.” Clients who had bought outside London two years ago could easily have lost 5 per cent of their property’s value. “This, coupled with tighter lending criteria, means they are not going to be able to remortgage,” he said. Some clients had to switch to interest-only mortgages to keep up with higher monthly interest costs. Borrowers who cannot remortgage have seen their interest payments jump by up to 50 per cent. Other mortgage brokers have experienced a similar trend. Cobalt Capital said it had noted a 10 per cent rise in the number of reduced/downvaluations in the past four or five months. Job done. The final nail in the HPI coffin. Quote Link to comment Share on other sites More sharing options...
BecksMyCat Posted March 22, 2008 Share Posted March 22, 2008 http://www.ft.com/cms/s/0/a93e3ff4-f786-11...0077b07658.htmlClients who had bought outside London two years ago could easily have lost 5 per cent of their property’s value. “This, coupled with tighter lending criteria, means they are not going to be able to remortgage,” he said. Not in London though. Well, not yet. Quote Link to comment Share on other sites More sharing options...
Sinking Feeling Posted March 22, 2008 Share Posted March 22, 2008 Barry Hall, at the Royal Institution of Chartered Surveyors, said the fact that there were more repossessed properties coming on to the market was also distorting values. Distorting or bringing real values back into clarity? Quote Link to comment Share on other sites More sharing options...
bobby9983 Posted March 22, 2008 Share Posted March 22, 2008 Job done. The final nail in the HPI coffin. I have to agree. It is the surveyors and the valuations they give that will bring the market down in the UK. I am a mortgage broker and so over years have come to realise that the job of a surveyor is the most arbitrary, non exact profession in the history of man. In good times they are too easily persuaded to give higher valuations (see Inside Track et al), in poor times they swing the other way completely. I am doing a remortgage for a client in Manchester who bought a flat 4 years ago for £145,000. He's not borrowed any more money and put in a 15% deposit to his credit. Two years ago the flat valued up at £175,000 when he remortgaged, now he has come to refinance again and he's been valued at £135,000. This puts him at 87% loan to value and without putting money in there is no way for him to remortgage. He will then see a £250 a month jump in mortgage payments, he may then be forced to sell or be reposessed himself, that property will go for a song thus contributing to the downward spiral. Quote Link to comment Share on other sites More sharing options...
bobby9983 Posted March 22, 2008 Share Posted March 22, 2008 Not in London though. Well, not yet. I think you'll find that over the last few years London has lagged the rest of the market, London will fall but the falls will come later this year, driven by the lack of bonuses, which will filter down through the system. Quote Link to comment Share on other sites More sharing options...
Mikhail Liebenstein Posted March 22, 2008 Share Posted March 22, 2008 This report is a great new weapon to cause upset at dinner parties. "Did you hear RICS are saying that in many areas properties are now 5% below their 2005 values?" Soup spat out, bread sticks snapped , nasty stain to cocktail dress etc. Quote Link to comment Share on other sites More sharing options...
Warwick Posted March 22, 2008 Share Posted March 22, 2008 I have to agree.It is the surveyors and the valuations they give that will bring the market down in the UK. I am a mortgage broker and so over years have come to realise that the job of a surveyor is the most arbitrary, non exact profession in the history of man. In good times they are too easily persuaded to give higher valuations (see Inside Track et al), in poor times they swing the other way completely. Due mainly to being sued in the last crash for negligent over-valuations. Quote Link to comment Share on other sites More sharing options...
29929BlackTuesday Posted March 22, 2008 Share Posted March 22, 2008 This report is a great new weapon to cause upset at dinner parties."Did you hear RICS are saying that in many areas properties are now 5% below their 2005 values?" Soup spat out, bread sticks snapped , nasty stain to cocktail dress etc. Think you'll find it's chavs who have fuelled this boom. Sub-prime you see. So the image should be blokes with their shirts out clutching bottles of WKD and Toyota SUVs parked outside their new-build mock-Georgian pile. Quote Link to comment Share on other sites More sharing options...
bobby9983 Posted March 22, 2008 Share Posted March 22, 2008 (edited) Due mainly to being sued in the last crash for negligent over-valuations. Precisley! That is what is happening again now. In the summer of last year all RICS surveyors were sent a memo instructing the to valuers to value all new builds with discounts at the net price rather than the gross, because the builders were putting these through fraudulently so the BTL and sub prime morons buying could get 100% finance. Lo and behold six months later valuers were getting arrested along with brokers and builders for being complicit in mortgage fraud. That ended the new build market and coincided with the credit crunch, now we're in the proverbial. Edited March 22, 2008 by bobby9983 Quote Link to comment Share on other sites More sharing options...
Killer Bunny Posted March 22, 2008 Share Posted March 22, 2008 It is the surveyors and the valuations they give that will bring the market down in the UK.I am a mortgage broker and so over years have come to realise that the job of a surveyor is the most arbitrary, non exact profession in the history of man. In good times they are too easily persuaded to give higher valuations (see Inside Track et al), in poor times they swing the other way completely. I am doing a remortgage for a client in Manchester who bought a flat 4 years ago for £145,000. He's not borrowed any more money and put in a 15% deposit to his credit. Two years ago the flat valued up at £175,000 when he remortgaged, now he has come to refinance again and he's been valued at £135,000. This puts him at 87% loan to value and without putting money in there is no way for him to remortgage. If you are saying that the valuatios were crap then why did you provide mortgages on crap valuations? For the same reason you will be out of business this year. HOW DARE YOU blame the surveyors? :angry: Quote Link to comment Share on other sites More sharing options...
Freeholder Posted March 22, 2008 Share Posted March 22, 2008 House valuation is an imprecise buisness. There is usually a small area of doubt and sometimes a large one. In a falling market the surveyor, whose duty of care is to the lender, will prudently take the more conservative interpretation of the available evidence. Quote Link to comment Share on other sites More sharing options...
barsark Posted March 22, 2008 Share Posted March 22, 2008 Recently finished refurb property here, sold before completion to local person, agreed 330k. First valuation - 300k. Agent said "that's rubbish, he doesn't know the area". Next valuation - 315k. Seller got 315 in the end. There will be many dissapointed sellers and as many happy buyers. I wonder how many people, when doing their accounts, are allowing for this type of upset? There are lots of fingers still to be burned. Quote Link to comment Share on other sites More sharing options...
Freeholder Posted March 22, 2008 Share Posted March 22, 2008 Recently finished refurb property here, sold before completion to local person, agreed 330k.First valuation - 300k. Agent said "that's rubbish, he doesn't know the area". Next valuation - 315k. Seller got 315 in the end. There will be many dissapointed sellers and as many happy buyers. I wonder how many people, when doing their accounts, are allowing for this type of upset? There are lots of fingers still to be burned. Very true. Like the use of old norse in your name. Bear shirted. The origin of the english term berserk. Quote Link to comment Share on other sites More sharing options...
bobby9983 Posted March 22, 2008 Share Posted March 22, 2008 If you are saying that the valuatios were crap then why did you provide mortgages on crap valuations? For the same reason you will be out of business this year.HOW DARE YOU blame the surveyors? :angry: That is utter rubbish mate how do I know what is a good or crap valuation? By the way I don't blame the surveyors per se, but I do think they have contributed to this. You don't have the experience that I do. I have instructed valuations in the past from Countrythin surveyors who have downvalued a property by £20,000 only to send b-surv round the next day and they up value it. It's an arbitrary profession based on opinion and feeling rather than fact. I won't be out of business this year if the great over-mortgaged become the great under-funded I will simply move on to the great under-insured. Expect to get a life insurance sales phone call tomorrow. Bring on the fear!!! Quote Link to comment Share on other sites More sharing options...
The Masked Tulip Posted March 22, 2008 Share Posted March 22, 2008 This report is a great new weapon to cause upset at dinner parties."Did you hear RICS are saying that in many areas properties are now 5% below their 2005 values?" Soup spat out, bread sticks snapped , nasty stain to cocktail dress etc. Mike, told you before mate - you have to stop wearing those dresses out in public! Quote Link to comment Share on other sites More sharing options...
Freeholder Posted March 22, 2008 Share Posted March 22, 2008 That is utter rubbish mate how do I know what is a good or crap valuation? By the way I don't blame the surveyors per se, but I do think they have contributed to this.You don't have the experience that I do. I have instructed valuations in the past from Countrythin surveyors who have downvalued a property by £20,000 only to send b-surv round the next day and they up value it. It's an arbitrary profession based on opinion and feeling rather than fact. I won't be out of business this year if the great over-mortgaged become the great under-funded I will simply move on to the great under-insured. Expect to get a life insurance sales phone call tomorrow. Bring on the fear!!! We surveyors seldom agree with each other. Thats part of what makes it interesting. Quote Link to comment Share on other sites More sharing options...
Rick62 Posted March 22, 2008 Share Posted March 22, 2008 And for those of us old enough to remember valuers downvaluing was one of the drivers of the 1989 crash. It becomes self-fufilling. This time with a few added factors, like the lack of available funding, the masses of overstretched borrowers and the 1 million BTL properties, of which half were taken in the last 4 years and are at risk of having fallen in value already from their purchase price. Quote Link to comment Share on other sites More sharing options...
headmelter Posted March 22, 2008 Share Posted March 22, 2008 If you are saying that the valuatios were crap then why did you provide mortgages on crap valuations? For the same reason you will be out of business this year.HOW DARE YOU blame the surveyors? :angry: HOW DARE YOU! Quote Link to comment Share on other sites More sharing options...
Freeholder Posted March 22, 2008 Share Posted March 22, 2008 And for those of us old enough to remember valuers downvaluing was one of the drivers of the 1989 crash. It becomes self-fufilling. This time with a few added factors, like the lack of available funding, the masses of overstretched borrowers and the 1 million BTL properties, of which half were taken in the last 4 years and are at risk of having fallen in value already from their purchase price. I remember downvaluing property in the last crash. Once I gave a man a rough idea of what the answer would be while I was in his house. The look on his face as he struggled to retain dignity in the face of financial ruin is strong in my memory still. Its not something you do lightly. Not if you want to be able to look at your own face in the mirror. Quote Link to comment Share on other sites More sharing options...
barsark Posted March 22, 2008 Share Posted March 22, 2008 Very true.Like the use of old norse in your name. Bear shirted. The origin of the english term berserk. My goodness, in all my years your the first to spot it. Bear skin, as I recall. Warriors would don the skin of a bear before battle and were said to become possessed with the fighting spirit of the beast. Very sweet Quote Link to comment Share on other sites More sharing options...
Killer Bunny Posted March 23, 2008 Share Posted March 23, 2008 That is utter rubbish mate how do I know what is a good or crap valuation? By the way I don't blame the surveyors per se, but I do think they have contributed to this.You don't have the experience that I do. I have instructed valuations in the past from Countrythin surveyors who have downvalued a property by £20,000 only to send b-surv round the next day and they up value it. It's an arbitrary profession based on opinion and feeling rather than fact. I won't be out of business this year if the great over-mortgaged become the great under-funded I will simply move on to the great under-insured. Expect to get a life insurance sales phone call tomorrow. Bring on the fear!!! I doubt I will ever be your 'mate'. Surveyors HAVE NOT contributed to the HPC. The HPC is there and surveyors are RIGHTLY marking prices down. If there is difference of 10% so what? That is very small beer. If everyone upvalued all the time then the bubble would be ceaseless - which of course is nonsense, 'mate'. In fact, your lot has contrinuted to this crisis - 10x mortgages, self certs, 125% etc. Personally, I can sleep at night because NONE of my clients are in the sh1t that your lot has encouraged people to get into. Quote Link to comment Share on other sites More sharing options...
Bloo Loo Posted March 23, 2008 Share Posted March 23, 2008 I have to agree.It is the surveyors and the valuations they give that will bring the market down in the UK. I am a mortgage broker and so over years have come to realise that the job of a surveyor is the most arbitrary, non exact profession in the history of man. In good times they are too easily persuaded to give higher valuations (see Inside Track et al), in poor times they swing the other way completely. I am doing a remortgage for a client in Manchester who bought a flat 4 years ago for £145,000. He's not borrowed any more money and put in a 15% deposit to his credit. Two years ago the flat valued up at £175,000 when he remortgaged, now he has come to refinance again and he's been valued at £135,000. This puts him at 87% loan to value and without putting money in there is no way for him to remortgage. He will then see a £250 a month jump in mortgage payments, he may then be forced to sell or be reposessed himself, that property will go for a song thus contributing to the downward spiral. This sounds like a case of somebody relying on an IO mortgage, otherwise the repayments made would have given him under 80%LTV. He'd have repaid nearly £3000 in the first year alone. Still, whats the problem, youve taken 3 swipes at commission Quote Link to comment Share on other sites More sharing options...
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