How to challenge a valuation

[tubs]

I'm refinancing a vacant block of land at the moment.

Council rates value it at $245,000.

CBA valuer values it at $195,000.

The CBA calculated it at a block in the estate which sold some time ago (not sure when). This block is significantly smaller than ours and has inferior views than ours.

But when this referenced block sold, it sold for $237sqm. Ours at 747sqm should bring the value to $244,300. This makes the council valuation correct.

The valuer also claims to have added in a premium to our block given its larger size, and that the council's valuation is too high.

But based on the valuer's calculations, the council's value is spot on, BEFORE adding in a premium for the extra size.

What can I do to challenge the valuer's estimation?

And before you suggest it, the CBA have the best LVR offering around, so I dont want to go to another bank. I'd probably only get the same valuer again anyway.

 

[josko]

hI tUBS,

I had the same problem with a val on a property. My house was valued 100k under because there had not been a sale in the street, nor the two adjoining streets for two years. Therefore the data the val was based on was 2 years old!

Not sure if there is anything you can do apart from changing banks and getting to know your valuer REALLY well.

Sometimes in this industry, it is not what you know, but WHO you know.

Regards Jo

 

[tobe]

you can pay a valuer to get another valuation, you can get three recent comparable sales and take them to the bank to get the val re assesses, and the valuer will argue the toss, or you can go to a new bank and get another valuer. Some banks will let you choose the valuer from their panel. I reckon you have a better chance if you use a broker, who's commission rests on you getting a good val!

 

[Rolf Latham]

ya gotta find some more comp sales that may work with your property

Dam hard in this case

ta
rolf

 

[Spectre]

Used to be a time where cba would use the ratable value of the land as valuation.

If its full doc they 'should be' able to do this and you have to tell your lender you're dealing with to check the policy. Even though their valuation system says order a valuation they can override it (thats what I used to do and that was 2+ years ago).
It'll be in some bulletin as to what they can or cant do. Then they cite the bulletin on the valuation printout

We also used to do that with land + builds - skipped using a valuer as if complete as we had a valuation on the land and the build cost.

If its low doc they'll value pretty much anything.

Other options
If you can also prove 3-5 comparable sales in the same estate/area you can get them to do a 'check valuation' with another firm (but you have to push - the way I Put it to them - they dont want to be out of pocket on it is that if it comes in lower then I'll pay for the valuation - so far it never has).

Get the person you are working with to ring the guy in property consultancy services (PCS). PCS is in charge of the valuations for the bank - and they might be able to sign off on using the land valuation from the rates.

If not PCS will often authorise the check val and they want to be kept into the loop of who is and isnt doing good valuations so then they can go back to Valex and bump them off the cba valex panel.

One good thing about cba is they do have a few ways to argue valuations. A lot of the other lenders whats done is whats done and there's no route.

 

[Mamaof3]

fight it fight it fight it

I posted a story about our friend who wouldn't accept a banks valuation and she won...it only took about 4 weeks before the extra funds were made available to her as well. This was despite the valuation having been accepted by the client and the loan had settled too so its not impossible!

Put your case to the bank and i'm sure there's an appeal process you can go through to argue the valuation. Gather as much info on comparable sales as possible and if there aren't any comparable sales in your particular suburb, use the next best comparable sales data which may be the suburb next door or a house on the other side of the main road.....its not ideal but if there are no comparable sales for your suburb using the sales data from adjoining suburb is way better than going on the data from 2yrs ago.

good luck and let us know how you go!