Jordan Spring East Land Valuation

Oct 18, 2018
3:24 pm

Hi there,

We bought a land last year in Nov 2017 in Jordan Spring East.
Now we are in process of signing off our building contract with MJH.

Just curious to know what are the valuations coming out from bank when applying for construction loan specifically with CBA nowadays? I meant whether its undervalued or same as sale of contract price or high??

circaten

Oct 18, 2018
8:06 pm

Hi Ravi,

I believe CBA will send out someone to do a valuation on the land, then after you have plans they will do another valuation based on the completed home. We bought land on the other side of the Great Western at Caddens Hill and it has been valued at sale price if that helps. Otherwise there is no sure way to tell until they have done it.

Skcel

Oct 19, 2018
6:01 am

We are going through the process now. A valuation was completed on the block and a second valuation was completed on the build / total price. If it's all good the valuation will come back spot on no more or no less. Even if your land is worth more it will always come back as the price you paid for it. Once this is completed you will get formal approval. Once plans are out of council and the bank checks them off they will complete a letter to commence the build and you will be good to go.

ravi123

Oct 19, 2018
8:02 am

circaten

Hi Ravi,

I believe CBA will send out someone to do a valuation on the land, then after you have plans they will do another valuation based on the completed home. We bought land on the other side of the Great Western at Caddens Hill and it has been valued at sale price if that helps. Otherwise there is no sure way to tell until they have done it.

Thanks, Circaten
Appreciate

ravi123

Oct 19, 2018
8:08 am

ravi123

circaten

Hi Ravi,

I believe CBA will send out someone to do a valuation on the land, then after you have plans they will do another valuation based on the completed home. We bought land on the other side of the Great Western at Caddens Hill and it has been valued at sale price if that helps. Otherwise there is no sure way to tell until they have done it.

Thanks, Circaten
Appreciate

Thanks, Skcel,

I understand that banks do valuation as following:

"Lend sale price at the time + Construction Fixed Contract price = Valuation"

Is that correct?

I am afraid because we might get lower valuation from CBA for our construction loan and we have to get the LMI to borrow maximum amount.

Can someone please advise on that matter?

kks

Oct 19, 2018
10:11 am

Quick review has vacant JS residential land currently selling at average $1300 sm.

Skcel

Oct 19, 2018
11:43 am

ravi123

circaten

Hi Ravi,

I believe CBA will send out someone to do a valuation on the land, then after you have plans they will do another valuation based on the completed home. We bought land on the other side of the Great Western at Caddens Hill and it has been valued at sale price if that helps. Otherwise there is no sure way to tell until they have done it.

Thanks, Circaten
Appreciate

Thanks, Skcel,

I understand that banks do valuation as following:

"Lend sale price at the time + Construction Fixed Contract price = Valuation"

Is that correct?

I am afraid because we might get lower valuation from CBA for our construction loan and we have to get the LMI to borrow maximum amount.

Can someone please advise on that matter?

Yep that's correct, if your purchased the land some time ago like mentioned you wont have a problem with the valuation. They will only price it for what you paid for it. If the value has gone up they dont take that into account.

The will value your build at the fixed price last quote from your builder. Usually this wont be an issue unless they the builder is ripping you off significantly.