This week’s letter comes from Chris Bramham, and his response to the article: ‘Two surveyors value the same property with £100k difference – this is what really frustrates advisers’ – Marketwatch.
He said: “As the commercial director of a reasonable sized valuation firm I am staggered that there can be such a difference on these figures.
Valuing properties was once an art and it is now more a science. We have to use new ways of arriving at figures based in comparables. These are done using data that looks at sales in an area.
The problem is that this can be interpreted differently. How far out do you go from the subject property, how long ago was a sale achieved etc.
The question would be, what is it down valued from?
The figure an estate agent puts on it to get the property on the books, or the figure the owner thinks it should be based on emotion?
This will always be emotive as someone else said, everyone’s home is their castle, but reality has to be taken into account.
We often see valuations where we feel they should be higher, but a surveyor’s obligation has to be to protect the lender and therefore it will often cause frustration with the broker and the borrower where a [down] valuation occurs.
But if the surveyor uses the tools, and more importantly the experience, a robust figure should be and is achieved, but that may not please all the parties.
Automated valuation models (AVMs) are more prevalent and widely used but they are based on solid data. But the cautionary note is that this is historic.
In conclusion, for two valuers to be so far apart makes no sense, when there are specified guidelines on how to achieve a value.”