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I wonder if you may be able to help me. I am a portfolio landlord, 7 properties, 50% LTV. Net income £40k.
I am in the middle of a purchase of a flat, off plan, it is nearly complete.
Cost £216,000 I want a mortgage of £130,00 (60%). Rental will be £800pcm (have tenant waiting).
Valuation survey came back rejected. with the following comment:
"Demand in the owner occupier market is currently weak: consequently, this property is not suitable security for mortgage purposes and no valuation figures have been provided. The stated purchase price cannot be supported by reference to comparable evidence. The estimated rental cannot be supported by reference to comparable evidence"
I have responded with proof that 7 out of the 12 flats in my block are already sold, before it is finished, and with proof of tenant. I also referred them to a similar new build block 300 yards away built a year ago. These are slightly smaller, and the site is not quite as nice as my site, but they sold for £180,000 to £200,000. And they rent for £750 all day.
The surveyor has refused to accept my proof, and refused to change his report, yet provided no support for his opinion.
What can I do?
Problems today with off plan developments not being finished because developers run out of funding is becoming a major problem. Once its finished try again with a new surveyor/lender. Although I cannot comment on this report as I do not know the area, the general tone is probably correct in today's market.
Hi Douglas,To be clear, the flats are finished, just carpets being laid, and grounds being landscaped. So not a reason for problems.With regards to the "general tone being correct in todays market", do you mean that no one can but a property with a 60% mortgage at the moment? I had better inform all of the UK estate agents, as they are in for a tough February!
Just means they don't want to lend to you. Obviously you will find a lender but what I am saying is that it is becoming a more difficult environment to raise funds.
(*Moderator note: Comment removed as not in line with our community standards*).
Hi NickThanks for your reply. I have put another application together with another lender. My issue is what redress do I have against a surveyor who has done an incompetent jobIt seems crazy to me that I pay for a survey, that is incorrect and poorly researched, and it has cost me both time, and stress, as well as another set of application and valuation fees.How do I get my fee back?
Unfortunately, I doubt you have any redress. The valuer produced the report for the lender and their duty of care is toward the lender only. You might have redress if you had commissioned the report, but as it is, there's little you can do.
your initial comments mentions "owner occupier property" Is this a resi property or BTL?
Could it be that the valuer has been mis-directed? Have they been incorrectly told that the property is residential rather than a BTL?
I can sort of understand a valuer saying its not a good residential buy if the rest of the building is Full of BTL tenants.
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Hi PTFS,Thanks for your reply. I queried this, and the reply was that he meant that as there is no owner occupier demand, the flat would be hard to sell if it was repossessed.
Do not forget most lenders do not have in house valuers.You could apply to another lender and end up with the same valuer being instructed
This is where the rubber hits the road - the man with the iPad can sink your dreams at the touch of a report
See so often plans built on a remortgage - the old withdraw the deposit you put in and expand
The days are over for this sort of strategy - city centre blocks of flats are not the place to invest
Keep it simple buy an a small house every time unless city centre property has a garage and parking space which you can rent separate from the flat
That’s where the money is ....
Learn Change and Adapt ?????
All comments are for casual information purposes only. If you wish to rely on any advice I have given please ensure you obtain independent specialist advice from a third party. No liability is accepted for comments made.