Bank Valuations - Reality typically higher or lower?

[oneuppmanship]

Bank Valuation figure - Reality typically higher or lower upon sale?

I understand every situation is different and this is a generalisation, but looking for some feedback on what your experiences with bank valuations, in relation to what your property actually sells for.

In my experience, bank has always undervalued and sometimes by many tens of thousands.

Thanks.

 

[Aaron_C]

The slant is always towards the 'undervalued' side of things because the valuer is liable to be sued by the bank if he gets it wrong. There was a lot of litigation after the 1980s bust so valuers are always conservative these days - plus there is no incentive for them to value it higher because they don't owe you any duty of care.

 

[Jamie M]

Depends. A lot of refi's that depend on the clients estimated value of their property come in lower in comparison to on market property transactions.

Cheers

Jamie

 

[mattnz]

What happens typically when you change lenders Jamie (as opposed to refi with existing lender)?

 

[Jamie M]

What happens typically when you change lenders Jamie (as opposed to refi with existing lender)?

It's the same deal. The client provides an estimate (which we can help with via residex, ect). If it's just a straight lender swap without any "cash-out" then a lower valuation may not cause too many dramas providing the LVR doesn't go above 80%.

Cheers

Jamie

 

[Leghorn]

It is naive to think all bank valuations are conservative/undervalued. There are plenty of examples where banks have lent money and not recovered their principal when they have sold up a property. Unfortunately valuers continue to be sued for overvaluing whilst their customers complain they are conservative.

 

[Rolf Latham]

Bank Valuation figure - Reality typically higher or lower upon sale?

I understand every situation is different and this is a generalisation, but looking for some feedback on what your experiences with bank valuations, in relation to what your property actually sells for.

In my experience, bank has always undervalued and sometimes by many tens of thousands.

Thanks.

Hiya

In the current markets in many places in Australia the vals are often better than sales price : )

ta
rolf

 

[laurieload]

This was our recent experience for a prop in brisbane - value WAY over what we would fetch in the market

 

[Success]

It's the false sense of wealth banks can at times give you ... been there many times.

Selling and what a person is prepared to pay is another complete story !

Be careful.