View more on these topics

Price must be right, even in a downturn


Valuers face a range of challenges in a housing slump, as changing lending criteria and the departure of some players compound the usual factors that cause an imbalance between supply and demand.

Lack of comparable transactions and unreliable data make accurate valuations harder. And the pressure only increases as applicants are more likely to question valuations and the threat of legal challenges looms.

But there are things valuers can do to ensure valuations are as accurate as possible. All figures should be supported by at least three comparable sales, all of which should have been researched and appropriately documented.

Previous sales are by nature historic, so in a volatile market the gap between comparable sales and valuation date must reflect trends using knowledge of local factors.

In some cases not enough hard evidence is available, making it necessary to resort to soft evidence.

This can be in the form of reviewing asking prices and marketing periods, discussions with estate agents or comparing prices in similar areas.

It is vital to justify how comparables support valuations. Detailed documentation is the key to accurate valuation but to achieve this the industry and consumers need to recognise that speed and quality of service don’t always go together.

The price paid should reflect the work involved in providing an accurate and indemnified service, and this often takes longer in turbulent market conditions.



Interest rates after the inflation figures and MPC minutes

Following yesterday’s publication of the disappointing March inflation figures, with the year-on-year Consumer Prices Index up from 3% to 3.4%, and the Retail Prices Index up to 4.4%, today the Monetary Policy Committee’s April meeting minutes and the latest unemployment figures were published.

Brokers face delays in AR application process

The Financial Services Authority is taking a tough line on brokers applying to become appointed representatives, resulting in delays to the application process. It is thought that the regulator is gathering more information on prospective ARs ahead of extending its approved persons regime to mortgage advisers. This proposal formed part of the Mortgage Market Review […]

Abbey unveils fee-free deals to build loyalty among clients moving home

Abbey for Intermediaries has launched a range of fee-free fixed and tracker rates for borrowers looking to remortgage with the lender when moving home. The Loyal Mover scheme allows clients with less than six months remaining on their product to transfer to any deal from its new range with no early repayment charges, as long […]


GEMHL targets clients with credit blemishes

GE Money Home Lending has overhauled its product range to cater for borrowers with minor credit blips but has ditched its self-employed offering. The lender says it wanted to test the products on full status applicants but has not ruled out catering for the self-employed in future. Rates for its GEM1 product start at 4.54% […]

Finance is only one hurdle for small developers

The housebuilding market in its current form simply isn’t working. We are completely over-reliant on the biggest players in the industry – the largest nine are responsible for more than 50 per cent of the new homes built in the UK. But there is a reluctance to do more, particularly in this uncertain post-Brexit world. And with […]


News and expert analysis straight to your inbox

Sign up