Hi all, in reference to my earlier thread regarding our PPOR being valued during the construction phase, can someone (perhaps a Valuer?) please explain to me the difference between valuing a property TOC (tentative on completion) and valuing the completely finished home? We are hoping to get a second val done after the home & landscaping are complete to give us a higher val than was done during construction. So is there a difference between providing on paper fixed costs of works to be completed and valuing everything after it is finished or are we wasting our time with a second val?
When we initially borrowed to build, the bank valued our total lend based on the price we paid for the land in 2010 ($151,500) + the fixed price contract ($340k). Fair enough. We currently have $20k sitting in offset on our construction loan to cover our upgrades over and above our fixed price contract.
The fencing cost ended up being way more than we had been advised to budget for when getting the builder to quote, so we needed more money to finish as we still have to provide our own blinds, turf & lansdcaping which weren't included in the contract.
The bank had always told us we could 'get the property valued at an estimated completion' during construction if we felt we were going to fall short. So we did.........
The valuation came back at $505k which is less than what we are shelling out to build! So based on that val, the bank won't lend us a cent more to finish. The plan now is to pay for our upgrades & fence out of redraw (this will use all of the $20k), then use our Credit Card to install blinds, turf & landscaping, get a new (higher?) val and borrow against the house to get rid of the new Credit Card debt.
Although we provided all of the quotes & costs for the fencing & kitchen/bathroom/laundry fittings upgrades, it appears the valuer has disregarded the extras (or didn't receive them from RAMS?) and just added the land & contract price together & added a little extra to account for growth?
A similar unimproved block two doors down from us has sold in March for $175k and across the road from us, a similar block (although a better shape & backing onto the golf course) also sold in March for $245k (in 2010 it sold for $155k). And this is for sale next to said $245k block for $598k. Our house is a stand alone 4 bed + office, 3 living areas triple garage home on a 1018sm block. You can't get a similar block to ours here for under $175k and nearby estates are selling at starting prices of $179,500k. I have also just heard that a home similar to ours is about to hit the market at a price of $650k! If that's true it hasn't yet been advertised on the internet.
Based on these current market trends, is it likely that a second valuation undertaken on the home once established & presented going to improve the standing valuation? I'm hoping yes but then that would also make the bank a bunch of liars for leading us to believe a 'tentative on completion' valuation is exactly the same as the end product valuation but just bringing it forward for finance purposes.
Thanks in advance!
When we initially borrowed to build, the bank valued our total lend based on the price we paid for the land in 2010 ($151,500) + the fixed price contract ($340k). Fair enough. We currently have $20k sitting in offset on our construction loan to cover our upgrades over and above our fixed price contract.
The fencing cost ended up being way more than we had been advised to budget for when getting the builder to quote, so we needed more money to finish as we still have to provide our own blinds, turf & lansdcaping which weren't included in the contract.
The bank had always told us we could 'get the property valued at an estimated completion' during construction if we felt we were going to fall short. So we did.........
The valuation came back at $505k which is less than what we are shelling out to build! So based on that val, the bank won't lend us a cent more to finish. The plan now is to pay for our upgrades & fence out of redraw (this will use all of the $20k), then use our Credit Card to install blinds, turf & landscaping, get a new (higher?) val and borrow against the house to get rid of the new Credit Card debt.
Although we provided all of the quotes & costs for the fencing & kitchen/bathroom/laundry fittings upgrades, it appears the valuer has disregarded the extras (or didn't receive them from RAMS?) and just added the land & contract price together & added a little extra to account for growth?
A similar unimproved block two doors down from us has sold in March for $175k and across the road from us, a similar block (although a better shape & backing onto the golf course) also sold in March for $245k (in 2010 it sold for $155k). And this is for sale next to said $245k block for $598k. Our house is a stand alone 4 bed + office, 3 living areas triple garage home on a 1018sm block. You can't get a similar block to ours here for under $175k and nearby estates are selling at starting prices of $179,500k. I have also just heard that a home similar to ours is about to hit the market at a price of $650k! If that's true it hasn't yet been advertised on the internet.
Based on these current market trends, is it likely that a second valuation undertaken on the home once established & presented going to improve the standing valuation? I'm hoping yes but then that would also make the bank a bunch of liars for leading us to believe a 'tentative on completion' valuation is exactly the same as the end product valuation but just bringing it forward for finance purposes.
Thanks in advance!
