How Do Online Property Valuations Work?
Online property valuations are typically carried out by surveyors at the request of a mortgage lender. When you apply for a mortgage, your lender will have a valuation survey or mortgage valuation carried out in order to ensure that the property is worth the amount that you are going to pay for it. A valuation may also be carried out if you are applying to remortgage your current property, for the purpose of checking that the property is worth the amount that you have applied for.
Table of Contents
What is a Property Valuation in London Online?
Online valuations are typically carried out by surveyors for the benefit of the lender. Since they are desk-based, they have a limited scope, and only provide information for the lender to understand whether or not the property is worth enough to provide viable security for the mortgage amount you have applied for. However, the online valuation can also provide buyers with a clearer idea of whether or not they are paying too much or too little for the property.
Today, online valuations are usually the most common choice when it comes to checking that the property is worth the amount the buyer is asking to borrow. Traditionally, the surveyor would have visited the property to look around and compile a report, but with the rise of more online information and tools at their disposal, surveyors are able to value properties using online sales data and other online information using databases such as the Land Registry.
When Will a Surveyor Visit During an Online Property Valuation in London?
In some cases, the surveyor may be instructed to visit the property in person alongside conducting the online valuation. This could involve simply driving by the property to check the exterior and make sure that everything matches up to the information that they have found online or visiting the property in person for a short visit of between fifteen and thirty minutes where they will inspect the property to confirm key details and check for any defects that could impact the value.
In some cases, the lender may decide to go further than the online valuation and have a physical visit carried out. This is often the case if the property is constructed using a non-standard material, when the lender hasn’t lent in a certain area before, or if there is not enough information available to successfully carry out an online valuation. However, most high street lenders now have access to a huge wealth of information online that they can use to assess the value of a property, and with more lenders now offering free valuations to buyers, surveyor visits have become rarer.
Can You Do Your Own Free Online Property Valuation in London?
It’s not just lenders and surveyors that have access to data, information, and tools that can help them assess the value of a particular property. If you are considering selling your property or are looking at house prices in a certain area where you might like to buy property, then you can also benefit from this online information to get a free online property valuation. There are several property value calculators that you can use online to get a rough idea of how much your house might be worth, although it is recommended that you have a professional valuation carried out by a surveyor or estate agent if you are selling your home, before deciding on an asking price.
If you want to find out more about how much a certain property might be worth, there are various sites that you can use to find more information on property prices in the local area and the latest sale prices of similar properties that have sold in the past few months. Some property search sites now also offer features where users can check recent sale prices in the area, rental values, and more to get a better idea of how much a property might be valued.
What to Expect From a London Online Property Valuation?
If you are buying or remortgaging a property, then you can usually expect the mortgage lender to have an online valuation carried out on the property to check that it is worth the amount that you are asking to borrow to pay for it. Many lenders now offer this for free in order to appeal to more customers and be more competitive in the market. However, if you are paying for your valuation, this can cost anywhere between £150 and £1,500, according to the Money Advice Service. The asking price of the property will be the main factor that influences the cost of your valuation.
After the online valuation has been carried out, the surveyor will provide all the information that they have found to your lender and give their opinion on how much they believe the property to be worth. If the surveyor agrees that the property is worth the sale or remortgaging price of the property, the lender will usually accept your application and offer the loan that you have requested. However, if the surveyor does not agree that the asking price is in line with the value of the property and that the asking price is higher than the value, a ‘down valuation’ may occur. This can be frustrating as it may lead to your mortgage lender giving a revised, lower offer, which could affect your ability to purchase the house unless the seller is willing to drop their asking price in line with the valuation figure.
Online Valuations Vs House Surveys
It is important to note that when you are buying a property, you cannot rely on the online valuation that is carried out by your mortgage lender to provide you with any further information other than how much the property is worth. While you may be able to get some more information on any defects that might affect the value in the event of the surveyor visiting the property, this is unlikely to happen in most cases.
Buyers should be aware that despite sometimes being referred to as a survey, an online valuation does not involve the surveyor visiting the property to conduct an in-person survey that goes into detail about the condition of the home or any issues that you should be aware of before you buy it. In fact, even if you are required to pay for the online valuation to be carried out, you might not be given the valuation report or be updated on the information that your lender has been provided by the surveyor.
Buyers will still need to arrange for a separate building survey such as a homebuyer’s survey or structural survey to be carried out on the property alongside the mortgage lender’s online valuation. These surveys are much more intensive and rigorous and are designed to make you aware of any potential problems or defects with the property before you make the commitment to buy it. Along with this, a homebuyer’s report or full structural survey may also include a valuation, which some lenders may accept instead of having an online valuation carried out.
What to Do if An Online Valuation Isn’t What You Expected
If you are buying a property and the mortgage lender has down valued it as a result of the online valuation, there are several things that you can do as the buyer to try and solve this problem. The first thing to do is try and renegotiate the asking price with the seller. In many cases, a down valuation can actually be a strong negotiating tool for buyers that can help you get your new property for less. Many sellers may be willing to drop the asking price in line with the valuation as they know that if your lender does not think the property is worth what they are asking for it, there’s a high chance that other lenders will agree, which will only lead to the property being on the market for longer as the seller will likely struggle to sell the property for the price they want to other buyers. Along with this, some sellers are in a situation where they want to sell as quickly as possible, for example, if they have another property to buy lined up. In this case, they may be eager to push the sale through even if this means reducing the asking price.
On the other hand, if you are dealing with a seller who is sticking to their original asking price or you have received a down valuation on a remortgage application for a property that you own, you may want to consider challenging the valuation. You can do this if you have solid evidence that the property is worth more than it has been valued at. However, it is at the lender’s discretion whether or not the challenge will be accepted.
Online valuations are mostly carried out for the benefit of mortgage lenders, and involve checking online information about the property, the local area, and recent sale prices of similar properties to determine how much a house is worth.
