Browse Forums Home Finance 1 Oct 31, 2012 8:26 am We were all set to go with our loan, just had to wait for the valuation to come back and the lady at the bank said that it wouldn't be a problem because we weren't upgrading much and she had approved other loans for more on houses with less features in areas that weren't as good. The land developer and builder were also both very confident. We got the valuation back yesterday and they have valued the house at $30 000 less than what it will cost to build it. All parties are very shocked. We haven't added a lot to the contract price, just a driveway, security screens. There are a few little extras like stone benchtops and glass splashback but they only add up to a few thousand dollars so won't really make much difference if we take them out. Everything else is included. The total cost of the house would be $946 per sq metre (even including the price of the driveway and security screens) but the bank are only allowing an amount which works out at $875 per sq metre. They said that because it is a new estate, they don't have much to go on, so have based their valuation on one house which sold a few months ago, however they won't allow us to look at the valuation or speak to the valuer. They also couldn't tell us if the house they are basing the valuation on has a study or alfesco area or what condition the house was in. They said it didn't matter. Our land developer has sent the bank an email with a list of properties that have sold for more in the last year and also for land that has sold for more than they are valuing ours at, do you think this will make any difference? They have come back lower for the land as well but not by much, it seems to be the house that they are saying is too much. The builder is very confused as he checks other builder prices all the time and is confident that he is well priced. We also shopped around and he was the best priced and offers a lot more inclusions. Should we shop around? Which banks are better with valuations? My build thread: viewtopic.php?f=31&t=65324&p=1032514#p1032514 Re: Low valuation on new build 2Oct 31, 2012 8:36 am Oh another low valuation. Man banks are freaking stupid about the way they value new builds these days... way too lazy to do any research.. I think it wont hurt to shop around.... I honestly don't think on bank is better than another because it looks like it ends up different with different people.. but you can try bankwest.. a few people seem to get better valuations with them.. Do you have a broker?? Building Henley Monaco Nouveau Q1 - Mernda Villages https://forum.homeone.com.au/viewtopic.php?f=31&t=57810 http://razbuild.blogspot.com.au/ Re: Low valuation - what to do? 3Oct 31, 2012 10:07 am I know how frustrating it is, we were undervalued 16k through ANZ whom I have heard are actually pretty good with their valuations. We were told that we were undervalued also due to lack of sales figures in our area we also had only minimal upgrades (in our opinion anyways). Our broker told us to gather recent sales figures we could find from our suburb for similar size houses and blocks to submit to the valuer and they would look at it again, we did this but the valuer would not budge. We then went to Bankwest and their valuation came in around the same as ANZ however because they do a higher LVR it worked out ok. We did have to pay more LMI but by that point we didnt care we just wanted to get going on our house. We had more than 10% deposit but ANZ would only do a 90% LVR and so we had to come up with the 16k or look at another bank, bankwest do a 95% LVR. Perhaps look into Bankwest as they will do a higher LVR, just be prepared to pay more LMI, also it is not advisable to try too many banks because it will muck up your credit rating so shop around and do your homework before you apply to different banks. Good Luck with it all, I know how stressful this can be, we were pretty down about the whole thing but it worked out for us and we are now well under way with our contruction. You will get there in the end Re: Low valuation - what to do? 4Oct 31, 2012 3:41 pm It is indeed very frustrating when you get a low valuation.We were undervalued 50K through Homeside. We then shopped around and went to NAB and they valued us for the full building amount.Strangest thing is Homeside is owned by NAB but I guess they use different companies to valuate the houses. All sorted out now and the build is going on well. Re: Low valuation - what to do? 5Oct 31, 2012 5:09 pm If you do shop around make sure the bank allows you to do the valuation upfront, else you will be shopping around aimlessly and trashing your credit report. Some differences btw the banks ANZ, NAB, CBA, Macq, AMP etc... - will allow upfront valuation + you have the ability to fight the valuation as well ( direct access to the valuers) Bankwest - They allow drive ways, fence, curtains and blinds etc... to be added on TOP of the fixed price contract. Also they do 95% LVR loans for constructions ( there are a few banks that allow 95% LVR loans...i won't name them all) Adelaide bank - Will allow for a $20,000 buffer/ side loan on top of their current valuation+ this $20,000 side loan DOES NOT add to the LVR...meaning you can potential save quite a bit on your LMI cost Certain Credit unions- allow the broker/client to use their own valuer...provider the valuer is on their approved list...so if the builder has another clients who had a valuation done with no issues, you could potentially use the same company/valuer to achieve the same/simliar results. Good luck. Regards Michael Michael Chan | Australia wide Mortgage Broker Michael@ShapeHomeLoans.com.au | 1300 74 5626 | Fax: 02 8212 8909 http://www.ShapeHomeLoans.com.au Re: Low valuation - what to do? 6Oct 31, 2012 7:25 pm Oh wow Michael, that's great to know. wish I had known that when we got our terrible valuation. Too late now but great tip for all. Building Henley Monaco Nouveau Q1 - Mernda Villages https://forum.homeone.com.au/viewtopic.php?f=31&t=57810 http://razbuild.blogspot.com.au/ Re: Low valuation - what to do? 7Oct 31, 2012 8:40 pm Thank you for all the advice. We don't have a broker. Didn't even think about getting one as we've always been happy with the bank we are banking with and they said that it would all be good. We're trying another bank who are going to value the actual house we are building, not just look at one house that sold and is 10 years old. Like the new bank said.. they can't really go on just one house sale as they don't know what condition that house is in or whether they have sold it quickly to move overseas or if the owners have defaulted and the bank has sold it for whatever they could get. We figure if the valuation comes back low again, we'll just have to build a smaller house and make it our 'for now' house. Thanks again! My build thread: viewtopic.php?f=31&t=65324&p=1032514#p1032514 Re: Low valuation - what to do? 8Oct 31, 2012 10:37 pm Guys it doesn't stop there. We have been in our home for over 16 months. We had it valued 13 months ago to get a top up on our home loan and it was valued at $500,000. Which was great since it cost us over 1 yr before that $406,000 all up for house and land. We recently decided to top up again on our home loan to purchase a new car and get airconditioning. Cba got a valuer out. I was very shocked to find out she valued our home at $430,000!!!!!!!!! That's a loss of $70,000 In 12 months plus all the additions we had since made! What I couldn't understand is how our house to build now in our estate would cost nearly $500,000 at a base price!!!!! I know the market has slumped but how our home has been valued way under building costs is a complete mystery. Forrester 43sq We have our keys (3/6/11) Now it's time to decorate (that's the fun part.lol) https://forum.homeone.com.au/viewtopic.php?f=31&t=37598 Re: Low valuation - what to do? 9Nov 01, 2012 12:18 pm From someone that has just been through this...don't stop and accept on value on the property. We were undervalued heaps and ended up shopping around and got our 100% valuation for both construction and land loans, with BOQ by the way who have been great. We saved over 11k mortgage insurance by doing this and got a better interest rate too I hope all goes well as I've just been through it myself and know the stress it can bring. Re: Low valuation - what to do? 10Nov 04, 2012 2:12 pm We have a broker and still got tripped up by an undervaluation. Hi Zalira, I thought we were alone in this situation, your post and it's responses have given us great advice on the possiblities outside normal bank valuations. We just had our O&A accepted in a new land release for $X plus a $10k rebate from developer. Then when bank went through unconditional approval, they valued the land at the $X - $10k rebate!? So my broker emailed me asking if I had an extra $10 stashed away to cover the shortfall? Makes you wonder how the hell there's offers out there asking for $3k dep and a job! 01/10/12 - Pre-Approved 14/10/12 - Signed O&A 16/10/12 - O&A Accepted 23/10/12 - Conditional Approval 09/11/12 - Unconditional Approval 23/11/12 - Titles issued Visit our Blog! Re: Low valuation - what to do? 11Nov 07, 2012 4:55 pm Agh! I give up. The second bank valued the house for full price but said that LMI would want a larger deposit, we don't have a way to get more money quickly. We will continue saving along the way but that won't help, so that bank is out of the question. Thankfully they did the valuation first and didn't do a credit check. So we've been trying to work out if we can cut money off the house price. We've worked out that we could cut off the activity room and a bit of the alfresco which would come to 20m2 and this would allow us to come in at the valuation price. This would still make the house 4 bedroom, 2 bathroom, double lockup, media room, tiled alfresco under roof, walk in pantry, walk in linen, WIR in main bedroom. We asked the bank if this would be okay as they valued our house and land for $410,000 based on a house that sold in the area which was a 4 bed, 2 bath, double lock up. Now they are saying that cutting the activity room off might decrease the valuation. Even though they clearly told us that the house they used to value our place was only 4 bed, 2 bathroom and they couldn't tell us the size of the house or if it had any extra rooms ie study, media, alfresco etc. Think I will see a broker tomorrow otherwise it might be all over red rover for us My build thread: viewtopic.php?f=31&t=65324&p=1032514#p1032514 Re: Low valuation - what to do? 12Dec 04, 2012 12:07 pm banks seem to be under valuation homes alot latelly.we recently had our home revalued to get a top up loan through cba we had in valued before buy them just after handover from the builder some 3 years ago valued $400,000 nothing done to in not even painted inside and was suprise this year in may to have it revalued at and find the valuation still the same $400,000 even thought we had added a pool,8 car garage and lots of landscaping etc and many other things. finished building 40 square home on 5 acres with perry homes.working on the landscaping just finished pool deck with ://forum.homeone.com.au/viewtopic.php?f=31&t=2217 Re: Low valuation - what to do? 13Dec 06, 2012 11:50 am Ours came in yesterday $74k under construction cost + land yesterday. Upon reading the valuation the valuer has included properties that are located nearly 7km away from our build location, they ignored a house that is only 700m away from our build that sold for more than our house + land... Also the valuation has evaporative cooling, we have reverse cycle + gas. Tiled roof, when we have colorbond. It is also missing our study and one of the powder rooms. Needless to say we are contesting with submission of 2 properties that sold for more than our build price and 2 others in the ball park range. - what a joke and waste of our and our brokers time. Re: Low valuation - what to do? 14Dec 10, 2012 10:16 am I hope your contesting of the submission works Zerosignal cause we had no luck when we did that. The bank told us straight up that it would be pretty useless as the valuers never change their valuation and they were right, they weren't prepared to budge even when we gave them a list of about a dozen places that were higher. We're currently waiting for the new bank to tell us if we have formal approval or not. They are taking ages to do everything but I've read on here that it is pretty normal for them. Good luck with it all! Zerosignal Ours came in yesterday $74k under construction cost + land yesterday. Upon reading the valuation the valuer has included properties that are located nearly 7km away from our build location, they ignored a house that is only 700m away from our build that sold for more than our house + land... Also the valuation has evaporative cooling, we have reverse cycle + gas. Tiled roof, when we have colorbond. It is also missing our study and one of the powder rooms. Needless to say we are contesting with submission of 2 properties that sold for more than our build price and 2 others in the ball park range. - what a joke and waste of our and our brokers time. My build thread: viewtopic.php?f=31&t=65324&p=1032514#p1032514 Re: Low valuation - what to do? 15Dec 10, 2012 10:25 am Zalira I hope your contesting of the submission works Zerosignal cause we had no luck when we did that. The bank told us straight up that it would be pretty useless as the valuers never change their valuation and they were right, they weren't prepared to budge even when we gave them a list of about a dozen places that were higher. We're currently waiting for the new bank to tell us if we have formal approval or not. They are taking ages to do everything but I've read on here that it is pretty normal for them. Good luck with it all! Zerosignal Ours came in yesterday $74k under construction cost + land yesterday. Upon reading the valuation the valuer has included properties that are located nearly 7km away from our build location, they ignored a house that is only 700m away from our build that sold for more than our house + land... Also the valuation has evaporative cooling, we have reverse cycle + gas. Tiled roof, when we have colorbond. It is also missing our study and one of the powder rooms. Needless to say we are contesting with submission of 2 properties that sold for more than our build price and 2 others in the ball park range. - what a joke and waste of our and our brokers time. We actually got our valuation in this morning and the valuers have bumped it up $30k in our case their valuation was really wrong - picking properties from two suburbs over and an address that did not even exist! So now we do not need to pay lenders mortgage insurance. Fingers crossed for your new valuation. Re: Low valuation - what to do? 16Dec 10, 2012 4:20 pm That is fantastic! Congratulations!! We got a valuation for the full amount from another bank.. but it is just a shame that they're taking so long to do full approval. Best of luck with your build Zerosignal Zalira I hope your contesting of the submission works Zerosignal cause we had no luck when we did that. The bank told us straight up that it would be pretty useless as the valuers never change their valuation and they were right, they weren't prepared to budge even when we gave them a list of about a dozen places that were higher. We're currently waiting for the new bank to tell us if we have formal approval or not. They are taking ages to do everything but I've read on here that it is pretty normal for them. Good luck with it all! Zerosignal Ours came in yesterday $74k under construction cost + land yesterday. Upon reading the valuation the valuer has included properties that are located nearly 7km away from our build location, they ignored a house that is only 700m away from our build that sold for more than our house + land... Also the valuation has evaporative cooling, we have reverse cycle + gas. Tiled roof, when we have colorbond. It is also missing our study and one of the powder rooms. Needless to say we are contesting with submission of 2 properties that sold for more than our build price and 2 others in the ball park range. - what a joke and waste of our and our brokers time. We actually got our valuation in this morning and the valuers have bumped it up $30k in our case their valuation was really wrong - picking properties from two suburbs over and an address that did not even exist! So now we do not need to pay lenders mortgage insurance. Fingers crossed for your new valuation. My build thread: viewtopic.php?f=31&t=65324&p=1032514#p1032514 Re: Low valuation - what to do? 17Dec 12, 2012 3:51 pm YAY!!! We just got informed that we have formal approval! Now I can get excited about the house again! My build thread: viewtopic.php?f=31&t=65324&p=1032514#p1032514 Re: Low valuation - what to do? 18Dec 12, 2012 4:05 pm Congratulations. How exciting.. hopefully it will be smooth sailing from here. Building Henley Monaco Nouveau Q1 - Mernda Villages https://forum.homeone.com.au/viewtopic.php?f=31&t=57810 http://razbuild.blogspot.com.au/ Re: Low valuation - what to do? 19Feb 12, 2013 11:42 am yvette72 banks seem to be under valuation homes alot latelly.we recently had our home revalued to get a top up loan through cba we had in valued before buy them just after handover from the builder some 3 years ago valued $400,000 nothing done to in not even painted inside and was suprise this year in may to have it revalued at and find the valuation still the same $400,000 even thought we had added a pool,8 car garage and lots of landscaping etc and many other things. SO we are thinking about putting in an offer on a block of land in Geelong this week. But after reading posts about low valuations we are a bit worried that the price we are paying for the block may be on the higher side.Is there any way where we could compare the prices. it is a small block of land in the 460sq.m range and we will be paying in the 160k+ range. Any thoughts appreciated. Re: Low valuation - what to do? 20Feb 12, 2013 11:47 am You can get the bank to order the valuation, before proceeding. Michael Chan | Australia wide Mortgage Broker Michael@ShapeHomeLoans.com.au | 1300 74 5626 | Fax: 02 8212 8909 http://www.ShapeHomeLoans.com.au 4 6193 If you can calculate the reasonable charged head from let's say 100mm below the gutter to the top of where the vertical riser's horizontal discharge pipe will be, that… 11 17524 Those span tables can be pushed a little for a low deck if you dont mind a little flex. Last deck I did, I pushed it a little and it was still rock solid - no noticeable… 6 13734 |