Can You Trust a Surveyors Valuation?
Or more correctly, can you trust a surveyors valuation who works for a mortgage lender directly or indirectly?
Our Building Surveyors can offer you advice and help on buying a property, building surveys (also known as Structural Surveys) and Home Buyers Reports, mortgages, estate agents, residential building reports, commercial building surveys. We also provide Specific Defects Reports, also known as Engineers Reports or Damp Reports, if you have a specific property problem. We can also carry out Independent Valuations but please note these are not for bank lending but are to advise you how much we feel the property is really worth.
Please free phone us on 0800 298 5424 and surveyor will call you back. All our surveyors are independent and are not attached to an estate agents, bank or building society and will off you impartial advice.
Free phone 0800 298 5424
There is no question about the training process and qualifications of a surveyor
Surveyors have a rigorous training, which includes a degree level education and practical experience and a test / interview by The Royal Institution of Chartered Surveyors from practising members of The Royal Institution of Chartered Surveyors. This is divided between the different categories of chartered surveyors.
There are even specialist divisions between the different types of chartered surveyors.
The specialists that generally carry out residential valuations are valuation surveyors, often abbreviated to chartered surveyors. Sometimes known as general practice surveyors and these surveyors carry out valuation work as well as a general range of other work. The ones that deal with residential valuations are probably the ones that you will see in action the most frequently. The training involves a combination of academic and practice experience, which should give the valuation surveyor a good cross-section of skills.
The world of valuation
Valuation surveyors will tend to fall into two groups; those that deal with commercial surveys and those that deal with residential surveys.
The ones that deal with residential survey valuations are the ones that the average person comes across most frequently. If you sell your house the valuer will be the person that dashes in and dashes out of the house again, having looked round each room and hopefully into the roof (it is meant to be a head and shoulders inspection) and had a brief chat with you. We say rushing as during normal housing market activity most companies will target them to do six plus of these per day to get their bonus and we have heard of some valuers doing over ten in one day.
The residential surveyors will in turn split into two categories: those that are independent and those that are connected to mortgage companies and are on what are known as panels.
The practicalities of visiting many properties in a day
We just wanted to mention how physically difficult it is with today's traffic problems to visit a number of properties in one day. Whilst the satellite navigation systems have made finding the properties easier the traffic between each property just gets worse and sometimes a large part of the day can be spent sitting in traffic jams. Unfortunately the economics of many large companies also mean that a greater and greater workload is piled onto fewer and fewer people. Though many valuers are now home based or, probably more correctly, car based it is still difficult physically to see many properties in one day, which is why they are forever rushing round.
We would also argue that they lose touch with the housing market and what is really going on and can make mistakes. If all they are doing everyday is the same thing they can become blind, as they literally view one house after another, after another, after another!
Mass production line
There is no doubt about it, many surveyors are on a production line and they literally cannot remember the surveys that they did at the beginning of the week. We have come across valuations where the wrong photos have been put with the property, which is quite understandable when they are doing 30 to 40 per week, as many are in busy times. Just image trying to drive to that many properties, let alone get out of the car, look around a property, take the correct photos, write a report, whilst still checking the ones that you did from the day before and perhaps getting in an unexpected traffic jam!
Where does the valuation work come from?
You may or may not be surprised to know that many, if not most, of the surveyors involved with valuation work are owned by mortgage companies. This is unless they are independent. A truly independent company would be part of the Independent Surveyors Association, known also as the ISA.
What are panel surveyors
When you come to have a mortgage on your new property the lender normally says that you can go to a surveyor on their panel. This is a group of surveyors that they have. Often they say that they have met their new house criteria, meaning that they achieved a certain standard. However, probably more correctly, in our opinion, meaning that they will get reciprocal work back from the surveyors owned by the mortgage lenders. These panels are impossible to get onto for independent surveyors, unless the market is very busy and then the mortgage companies will tend to utilise the economics of sales where work is farmed out to take the strain off their own valuers and give them a constant workflow. Due to reorganisation many of these valuers are no longer local, although they once were and are now centrally based and, as mentioned, the valuers work from their homes / cars.
Just try asking to use a local independent valuer and see what reaction you get from your mortgage lender. It will be along the lines of they have to be on our panel, which they can argue is fair enough as it's their money they are lending, or perhaps fair isn't the correct term when you understand exactly what is happening. We would argue that all surveyors are qualified to the same level and their own surveyors have a vested interest and therefore are nothing more than sales people!
So how does a mortgage valuer value?
In our experience, the mortgage valuer will value by having a set of details sent to him, which advises the location of the property, etc, some brief details on what the property is built of (these are usually obtained from the person selling the property or the estate agent, both of which have a vested interest, also on the form this will be the value that is agreed.
The valuer will then go and look at the property, have a brief walk through each of the rooms and the exterior of the property and a head and shoulders inspection of the roof and they will normally check dampness with an electronic damp meter (please read our article on this). He will then use comparable evidence to establish if the property is worth what the agreed price is. We would say that 99 times out of 100, possibly 999 times out of 1,000, the valuer will agree with the price to the very penny, as the argument goes.
The true value of property can only be established by testing it in the market, which a sale by estate agents does, so they look for comparables to explain the value that has been agreed. This obviously has the benefit also of ensuring the mortgage is given out without any complications.
When we worked for valuers we remember querying the values and it being the most awkward procedure to value anything other than what was on the form. This is when we began to understand and realise that the valuer was really helping the sales process, of not forming part of the sales process.
Valuation is a matter of opinion
It should be remembered that the surveyor is giving an opinion of the value, not what the market may or may not pay for it. We were recently helped out with a developer who regularly admitted that the prices he was getting his houses valued at was a percentage (and this was a double figure percentage) and he believe the houses would fetch less on the market. However, it didn't matter to him as he was looking to re-finance and not sell the properties.
If you truly do want an independent expert opinion from a surveyor with regard to valuations, mortgages, mortgage companies, surveys, building surveys, structural reports, engineers reports, specific defects report, structural surveys, home buyers reports or any other property matters please contact 0800 298 5424 for a surveyor to give you a call back.
More information on Surveyors:
If you have a commercial property, whether it is freehold or leasehold then sooner or later you may get involved with dilapidation claims. You may wish to look at our Dilaps Website at www.DilapsHelp.com and for Disputes go to our Disputes Help site www.DisputesHelp.com .
We hope you found the article of use and if you have any experiences that you feel should be added to this article that would benefit others, or you feel that some of the information that we have put is wrong then please do not hesitate to contact us (we are only human).
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