Bank Valuations

[Noeyedear]

Have a question about Bank Valuations. I have had two properties valued in the last 3mths both valuations came back at purchase price. Is this normal do they ever come back higher. I am assuming they come back lower but I was just wondering do they ever come back higher than purchase price. I am talking about initial valuation for loan on property.
Cheers

 

[willy1111]

If this is the initial bank valuation to buy the property, as far as I know the bank will use the lower of the valuation and the purchase price.

So yeah, usually they don't come in higer.

 

[Noeyedear]

If this is the initial bank valuation to buy the property, as far as I know the bank will use the lower of the valuation and the purchase price.

So yeah, usually they don't come in higer.

Yes thats fair enough. thanks

 

[mattp_99]

Is there a time frame anyone would suggest to revalue a property; We have recently refinanced a mortgage of PPOR in Perth and have had considerable capital gain in 9 months since purchase. We are in the middle of renovating and I would hope to realise the value of the renovation in approximately 2 months. So all up it would be around 3 months between valuations; is this necessary or worthwhile?

 

[Aimjoy]

Is there a time frame anyone would suggest to revalue a property;

A lot of lenders won't look at anything less than 6 months..... but if you are refinancing - no problem.

We have recently refinanced a mortgage of PPOR in Perth and have had considerable capital gain in 9 months since purchase. We are in the middle of renovating and I would hope to realise the value of the renovation in approximately 2 months. So all up it would be around 3 months between valuations; is this necessary or worthwhile?

Depends what you mean by "realise the value". If you mean revalue and draw down on the equity created then Yes this will be necessary. Whether or not it will be worthwhile in this instance depends on what you plan to do with the funds you get

If you do not plan to get your paws on more money, then No, it is neither necessary nor worthwhile (except perhaps for your own interest's sake)

Cheers,
Aimjoy

 

[Rolf Latham]

Hiya

I have done a few loans...........................out of those < 1 % have come in above purchase price, and about 5 % have come in below.

It requires guts for a valuer to value to real market upwards of contract price, and a weenie to value downward.............hence why you will rarely see vals above purchase.

In any case, as already mentioned lenders in many ( but not all ) cases will use the lower of contract or val anways.

PS. 9 mths is an ok time to realise an equity pull with most lenders


tarolf

 

[Kennethkohsg]

Have a question about Bank Valuations. I have had two properties valued in the last 3mths both valuations came back at purchase price. Is this normal do they ever come back higher. I am assuming they come back lower but I was just wondering do they ever come back higher than purchase price. I am talking about initial valuation for loan on property.
Cheers

+++++++++++++++++++++++++=

1. Yes, my own bank valuation at Lot 2012, Anchorage Estate came in at A$190,000 during settlement time on 8th Feb 2006 when I last purchased and settle it for A$160,000 only. This has happened when the Perth property market was booming towards its market peaK in Sep 2006 period.

2. However, this is likely to be an exception rather than the norm for bank valuation to come out higher than the stated purchase price.

Cheers,
Kenneth KOH

 

[imonmyway]

In late 2004 I paid 315k for my PPOR and the bank valuer valued it at 350k however when I had it valued recently to purchase an IP they valued it at 450k which was 30k less then 2 similar properties in the area less then 100 meters away had sold for around that time.

I had never spoken to a valuer before so tried to leave her to her work but in hindsight I should have talked her ear off about recent sales in the area. That was enough though for a < then 80% LVR so didnt really matter for the moment.