If the house is in Auburn or Merrylands, its the value before and after the house has been peppered with bullets from the latest bikie gang war.
Another volatile valuation question - rather urgent
- Thread starter Amadio
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If the house is in Auburn or Merrylands, its the value before and after the house has been peppered with bullets from the latest bikie gang war.
What about Greenacre?
Which one a lender will use will depend on a lot of things. e.g. ANZ may use just a contract of sale with no valuation if under 80% LVR, under a certain price and it is a purchase through a real estate agent.
A drive by is mainly just a desk top valuation with a confirmation that the house does exist - believe it or not there have been loans made on vacant blocks which have no house - where the client has pretended there is a house!
Update for anyone interested:
Firstly - all resolved and the couple have settled and are moving in.
But..it was an interesting series of discussions. It turns out that the valuer was correct. There is not a car space on the title. The car space attached to this particular apartment is noted in the by-laws. So even though it was advertised with a car space and all through the contract this car space kept popping up, it wasn't clear at the time that the valuation came in with "nil" car space that it actually wasn't on the title.
However, because car spaces are increasingly being added through by-laws rather than being put on the title in new apartment blocks, and because it is apparently extremely difficult to change by-laws involving car spaces, ING had it re-valued at the full purchase price. ANZ also valued it at the full purchase price.
Firstly - all resolved and the couple have settled and are moving in.
But..it was an interesting series of discussions. It turns out that the valuer was correct. There is not a car space on the title. The car space attached to this particular apartment is noted in the by-laws. So even though it was advertised with a car space and all through the contract this car space kept popping up, it wasn't clear at the time that the valuation came in with "nil" car space that it actually wasn't on the title.
However, because car spaces are increasingly being added through by-laws rather than being put on the title in new apartment blocks, and because it is apparently extremely difficult to change by-laws involving car spaces, ING had it re-valued at the full purchase price. ANZ also valued it at the full purchase price.
That is interesting. Who makes the call that its "extremely difficult? I wouldn't think that a Valuer would as they always disclaim that they aren't legal experts but you say the valuation still came in at sale price? Or they valuation came in lower and the bank lent against the sale price anyway?
By the sounds of it, your parking space (and possibly balcony) may form part of an exclusive use by-law. To change these by-laws requires 75% (or more - but don't quote me, read the strata act) of the BC to vote for a change to the by-laws. Hence, very unlikely.
It was probably done when the strata was established as the developer may have sold additional parking spaces to some units but not others. Would have been voted upon at the first AGM.
The valuation was redone and came back at exactly at the purchase price.
The basis is cost, and risk.
A drive-by (or "kerbside") valuation is where the valuer actually views the property to confirm that it exists and is as described. It's only necessary to view the property from the street so that arrangements do not have to be made with owners, tenants or agents for access, as this is time consuming. (I heard a story where a mortgage was made against a $300,000 two bedroom apartment which turned out to be a storage area in the basement of the building. Suffice to say the loan defaulted and the money was lost.)
The risk is whether the sale is relatively normal, and the whether the price is reasonable.
There are thousands of valuations being done each day, the banks need to cut their costs so they only perform "full" valuations when necessary.
The valuer would have to get a copy of the by-laws from the government body that registers them (in NSW it's Fair Trading IIRC) which is time and money. Often it's the time rather than the money that's the issue: the banks want a fast turn-around on loan applications too, imagine if apartment purchases took an extra 5 days for by-laws to be checked.
The valuation does not "come back at exactly the purchase price", the decision is made to accept the purchase price as the value of the property.
We bought one recently in Sydney, the exclusive use by law was included in the contract. I would think that is standard practice?
No issues with the valuation.
No issues with the valuation.
Just wondering, what suburb was this in?
Ok. (Still learning about valuation terminology).
ANZ will do a Contract of Sale valuation for over 80% LVR loans as well. Depends on a number of things.
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