As the UK began its gradual return to normal life, so too did the property sector begin to emerge from its temporary hiatus, albeit with safety precautions in place to protect our colleagues and customers.
However, as the industry was reignited, a long-standing urban myth surrounding property valuation also resurfaced – that valuers are ignoring data in favour of speculation and are routinely reducing valuation figures.
This misconception perhaps stems from the current uncertainties within the property market and the predicted economic recession… This misleading term of “down-valuation”, where a valuation ends up being less than the initial estimated value, has certainly been seen more frequently in the media since the lockdown began to lift.
But in reality, there is no such thing as a “down valuation”. What we are seeing is the result of overinflated estimates, and mismanaged expectations; phenomena that have always been present within the property market.
The property market is a constantly shifting landscape, with ever-changing property values due to many factors. When it comes to valuing your property, valuing surveyors consult in-depth market data looking at similar properties that have sold in your area in order to calculate the most accurate market value. This value is calculated based on the sale prices of similar local properties (but not those under offer). The valuation report is designed to mitigate risk for all stakeholders involved in the sale and purchase of a property and irrespective of valuation methodology, will always be based on real data and facts rather than speculation and supposition. Even during lockdown, when we were able to complete valuation reports via our bespoke Remote Valuation platform, our valuing surveyors observe RICS standards and protocols, assuring the accuracy of all of our independent valuation reports whatever the market conditions.
But of course, we recognise that it can be disheartening and distressing to feel that your property is worth less than you anticipated or had been led to believe. There is a fundamental reason for any difference in property value offered by the seller or agent versus that offered by the valuing surveyor.
When valuing property, surveyors are trained to look beyond the cosmetic and identify serious defects that require immediate attention and impact the market value of the property. For example, if a property is in need of vital renovations such as a new roof, the surveyor will factor this into the market value and allow for the cost of the repair.
An accurate mortgage valuation ensures that all parties are protected throughout the property sale and must be substantiated using empirical data and evidence. It is not in the interests of any valuing surveyor to increase or reduce a valuation estimate without due grounds or reason.
The COVID-19 pandemic has undoubtedly impacted the property sector and the practical means of conducting business. But none of the data suggests that properties are being routinely and wilfully undervalued under these circumstances.
The phenomenon of overestimates may be a market norm, but sellers and buyers can be assured that properties are always valued with the best interests of all stakeholders in mind.
If you have any questions about your Mortgage Valuation, please contact your mortgage lender in the first instance.