Surge in Property Down Valuations: Who’s to Blame?

Property staying on the market too long? We have a solution.

Down valuations have increased as the UK property market slows as we predicted back in January 2018. A down valuation is where an estate agent will sell a property at the value they believe the property is worth and the lender disagrees and feels the valuation is lower. Lenders typically lend on the lower value of the property, especially in the case of mortgages.

According to an online estate agent, one in five homes are being valued below its sale price by mortgage lenders which are causing problems for potential buyers, including financial losses for those who have paid for independent surveys on the property they wanted to purchase.

Leicester doesn’t come out unscathed either. We reported earlier in the month Thurmaston was seeing price falls in all property types except flats.

The online agent who collected and analysed the data said only 20% of homes sold through its site was being down valued whilst twenty years ago, only 5% of homes were being down-valued.

Some mortgage brokers, including L&C Mortgages, have seen a rise in advisers reporting down valuation which happens when a surveyor, instructed by the lender to survey the property for sale, thinks the property is worth less than the potential borrower has agreed to pay for it leaving potential buyers having to find often tens of thousands of pounds extra at short notice or lose the property and any funds spent up until that point in the property purchase.

But who is to blame?

The market value of a property is initially set by an estate agent (usually, at least), based on what they think it may be able to sell for, taking into consideration current market trends, the condition, age and other factors concerning the property whilst a mortgage valuation is carried out by an independent surveyor on behalf of the mortgage provider to make sure the property is worth what the buyer is paying which will impact the amount a lender is willing to lend.

The independent valuation is typically based on the sale price of three or more properties in the area which are similar in terms of age, size and location.

Recent reports suggest these down valuations are the result of lenders being too cautious but one agent, Harry Albert Lettings & Estates, feels it might not be the lenders to blame at all. The down valuations, according to the agent, are logical given lenders are aware of slowing property sales across the country which, taking into consideration supply and demand, would cause prices to fall in response to falling demand.

The Leicester letting agent says;

The likelihood is, homeowners looking to sell will be interested in changing agents after so long due to the agent’s inability to find a buyer in the current market conditions. Therefore, in a bid to secure business, estate agents are likely over-valuing properties to secure business at the cost of the homeowner whose property is left unsold. Especially if they’re paying upfront fees.

The current state of the market is blighted with lower sales levels than we’ve seen in previous years whilst house prices have been falling quite dramatically in some areas of the country, undoubtedly having a knock-on effect in neighbouring cities. Even Leicester appears to have subdued property sales, more ‘FOR SALE’ boards are staying up far longer with Belvoir and Seths Estate Agents‘ ‘FOR SALE’ boards deteriorating in the hot summer sunshine.

Harry Albert Lettings & Estates continues;

Estate agent over-valuations may not be deliberate, of course. It could also be that they’re not properly monitoring their own local property markets. Lenders take on far more risk when lending on a property than estate agents do selling a property so they have a much bigger incentive to properly monitor the market.

What should homeowners who are looking to sell their home do?

If a surveyor values a property for less than the over-valuation of the estate agent, the buyer may be left to find a large amount of cash in a short space of time which may include borrowing more which will cost more over time by being pushed into a higher loan-to-value mortgage.

Homeowners need to consider their options carefully. Whilst their property may sell, in the current climate, it is unlikely the property will sell. Especially when today’s estate agents don’t actively seek buyers, instead, many put your property on Rightmove or Zoopla and wait for buyers and tenants to find them.

Harry Albert Lettings & Estates prides themselves on generating more, better quality leads than Rightmove and Zoopla; a property they were asked to manage and find a tenant for was listed with another property on Rightmove, Zoopla and OnTheMarket and failed to let the property. Harry Albert Lettings & Estates generated nearly 20% more qualified leads during the seventeen days it took them to let the property compared to the several months the property sat on the portals. Similar results were found when comparing sales leads.

Harry Albert Lettings & Estates can provide an accurate valuation and sell your home by tender, meaning the buyer pays all the fees! They call it the Superfast No Fee Sales Strategy. The entire process usually takes around 56 days and sales complete within 28 days – if the buyer pulls out, the seller still gets paid whilst the property returns to market! Harry Albert Lettings & Estates regularly achieve full market value using their new sales strategy so for homeowners blighted by lower valuations, it’s worth giving them a call on 0116 321 4970.


  • There’s been a dramatic increase in lenders valuing properties lower than the estate agent valued the property, likely to secure business – especially if they charge fees upfront to sell your home.
  • One in five houses sold are being downvalued today as many agents desperately scramble to secure business.
  • Selling with Harry Albert Lettings & Estates will give you proper peace of mind that your property will sell within two months.

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