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Site Valuation for AIB Mortgage

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  • 03-10-2013 5:35pm
    #1
    JJudy
    Registered Users Posts: 34 ✭


    I am buying a site that I have managed to get planning permission for. The mortgage application form says that I needed to have the site valued by one of the approved AIB Residential Mortgage Valuer's Panel. So I went to one that was approved in my town. They came back with a figure that was ridiculously small compared to the sale price I have agreed to with the seller. I know that the site is worth more that they are valuing it at. I have searched for years looking for sites near my home and have enquired about many sites. I had said to the bank that I needed x amount for the site and they said no problem. My problem is the auctioneer is after valuing the site for more than less than I have to pay for it. Any advice please, would AIB accept a valuation for an auctioneer that is not on their list?


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    #2
    coylemj
    Registered Users Posts: 25,437 ✭✭✭✭coylemj


    JJudy wrote: »
    I have searched for years looking for sites near my home and have enquired about many sites.

    So every auctioneer in the area knew you were looking for a site. Is it possible that you're paying above the market value because the location suits you so well?

    The valuer has to set aside any such personal considerations and would be expected (by the bank) to put a value on the property or site that would be capable of beng achieved in an open sale.
    JJudy wrote: »
    Any advice please, would AIB accept a valuation for an auctioneer that is not on their list?

    Highly unlikely, the reason they have a list is because they don't want people turning up with their own auctioneer's valuation. Given a free choice, people would simply shop around until they found an estate agent who was prepared to accept a fee to agree with the client's valuation, such valuations would be worthless as far as the bank is concerned.


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    #3
    JJudy
    Registered Users Posts: 34 ✭JJudy


    Thanks for the reply, the cost of the site in in line with what sites are going for in the area. Its just their valuation of the site is nearly agricultural prices. The auctioneer said that prices have come down. I need to get the money to pay for the site and the bank need the valuation.


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    #4
    killers1
    Registered Users Posts: 1,443 ✭✭✭killers1


    Go back to the vendor with your valuation report and tell them that the Bank's valuer has indicated the site is overpriced, it's true value is €X and see if they will reduce the price accordingly.


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    #5
    JJudy
    Registered Users Posts: 34 ✭JJudy


    I did contact the seller and they were shocked at the price that the auctioneer put on it. They are not willing to sell at a lower price. I don't mind paying the price as I love the site and have full planning permission on it for my dream house. Do AIB always ask for a site evaluation when people apply for mortgages?


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    #6
    Cork selfbuild
    Registered Users Posts: 649 ✭✭✭Cork selfbuild


    killers1 wrote: »
    Go back to the vendor with your valuation report and tell them that the Bank's valuer has indicated the site is overpriced, it's true value is €X and see if they will reduce the price accordingly.

    May be too late considering he has gotten planning on the site...

    OP I would get a second valuation from another approved EA in the area and see where that comes out? Might be closer to sale price?


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    #7
    JJudy
    Registered Users Posts: 34 ✭JJudy


    Cork Selfbuild,
    I am currently getting a second valuation just to see, but if they do come back with a higher valuation what should I do then? Should I go into auctioneers and say look this is what other auctioneers thinks! I don't know what to do:(


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    #8
    killers1
    Registered Users Posts: 1,443 ✭✭✭killers1


    Cork selfbuild wrote: »
    May be too late considering he has gotten planning on the site...

    OP I would get a second valuation from another approved EA in the area and see where that comes out? Might be closer to sale price?

    Why is it too late to go back to the vendor? So what if they've got planning already? Planning is based on the size/spec of the property & is not dependent on the value of the site...

    OP, yes, the bank will ALWAYS look for a site valuation if they are being asked to advance funds towards the purchase of the site. You can try other valuers on the panel but if there is a huge difference between the sale price and the current valuation you might not get close to it. You can still proceed with the site purchase if you have the funds to do it. The bank will lend a % of the site cost or valuation (whichever is the lowest).


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    #9
    JJudy
    Registered Users Posts: 34 ✭JJudy


    Thanks for the reply Killer1, there are only two approved valuers in my county. I might try the other one. Even if they came up with a figure slightly more than the first auctioneer it would be worth it.


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    #10
    killers1
    Registered Users Posts: 1,443 ✭✭✭killers1


    Main thing is to ensure the first Valuer hasn't already submitted the report to AIB..


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    #11
    Cork selfbuild
    Registered Users Posts: 649 ✭✭✭Cork selfbuild


    killers1 wrote: »
    Why is it too late to go back to the vendor? So what if they've got planning already? Planning is based on the size/spec of the property & is not dependent on the value of the site...

    OP, yes, the bank will ALWAYS look for a site valuation if they are being asked to advance funds towards the purchase of the site. You can try other valuers on the panel but if there is a huge difference between the sale price and the current valuation you might not get close to it. You can still proceed with the site purchase if you have the funds to do it. The bank will lend a % of the site cost or valuation (whichever is the lowest).

    I meant it from the vendors perspective, contracts of sale are signed, op has invested in planning which is granted, op loves the site, I'm just saying possibly the vendor will dig heels in and say sorry sale price is the sale price knowing that the OP will try to meet the agreed price by hook or by crook, nothing to do with the value of the site now that planning is granted etc...

    If it was earlier in the process the vendor may be open to a bit more dealing maybe, that's all...

    As I said definitely try the other Valuer, try and have a chat with them before report is issued back to bank, outlining the purchase price and the sites in the area, it couldn't hurt...


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    #12
    JJudy
    Registered Users Posts: 34 ✭JJudy


    Rang the other valuer that is approved by AIB in my county. They said the site was too far away from them to value. They usually only do south of county. Rang another auctioneer in town (valuer for BOI) and they said that the valuation seemed too small and they gave me a rough quote on the information I gave them. If I went ahead with them I would have switch banks for the mortgage although AIB have been brilliant and the application was nearly approved. Its just so annoying that only one valuer in the whole of the county gets to influence something that I have tried so hard to get:confused:


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    #13
    killers1
    Registered Users Posts: 1,443 ✭✭✭killers1


    JJudy wrote: »
    Rang the other valuer that is approved by AIB in my county. They said the site was too far away from them to value. They usually only do south of county. Rang another auctioneer in town (valuer for BOI) and they said that the valuation seemed too small and they gave me a rough quote on the information I gave them. If I went ahead with them I would have switch banks for the mortgage although AIB have been brilliant and the application was nearly approved. Its just so annoying that only one valuer in the whole of the county gets to influence something that I have tried so hard to get:confused:

    Is there any Aib Valuer in adjacent counties that would be fairly close to you? Aib don't necessarily insist on the Valuer being in the same county as the property being valued.


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    #14
    JJudy
    Registered Users Posts: 34 ✭JJudy


    I could try ring one in a neighbouring county but if the other auctioneer wouldn't travel 30 minutes up the road what are the chances one in another county will. I might try though.


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    #15
    killers1
    Registered Users Posts: 1,443 ✭✭✭killers1


    JJudy wrote: »
    I could try ring one in a neighbouring county but if the other auctioneer wouldn't travel 30 minutes up the road what are the chances one in another county will. I might try though.

    I only mentioned it in case the site is close to the border of another county but you may have thought that the Valuer needs to be based in the same county as you which they don't..


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    #16
    JJudy
    Registered Users Posts: 34 ✭JJudy


    Thanks for the advice Killers1, it is very much appreciated, very stressed at the minute


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    #17
    jathclare
    Registered Users Posts: 40 ✭jathclare


    I had an AIB panel valuer look at my site and plans last year. I'd rather not say who or where.

    The called me to ask how much the house would cost to build, so I told them my estimate.

    I got back the house value report = to what my estimate was....nice.

    I got two different estimates for the site, varying by as much as €30K....but either one was good.

    Its considered out of date after 6 months anyway, €150 down the drain.

    I am expecting more accuracy with the propertyregister, Ironically similar houses have gone up in value so if the value is less than last year I could have a fight on my hands. Based on last year I only have a 4% LTV margin so I could be scuppered if it goes down.


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    #18
    Scoops2
    Registered Users Posts: 1 ✭Scoops2


    Hi Killers1
    I am new to boards.ie and mortgages but you seem to be the go to guy!! if you have a spare moment between fixing other peoples lives i wondered if you could help with this..
    Seen a property we love that is currently in use as offices and must be bought as commercial property. there is alreday a full cash offer on the place (k425) we will have deposit of 180/200 k depending on sale of my flat which is just going through. It was previously residential and don't imagine pp to reconvert would be an issue- there are precedents in the area.
    the tenants wish to remain and bring in 2000/month
    combined earnings of around 95 k gross.
    i read somewhere there would be 6% stamp duty- but am somewhat intimidated by the idea of commercial loan which i know nothing about, and entering bidding war with cash buyers. Going to talk to BOI about it but wondered if you had advice.

    many thanks if you are able to help


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    #19
    killers1
    Registered Users Posts: 1,443 ✭✭✭killers1


    Scoops2 wrote: »
    Hi Killers1
    I am new to boards.ie and mortgages but you seem to be the go to guy!! if you have a spare moment between fixing other peoples lives i wondered if you could help with this..
    Seen a property we love that is currently in use as offices and must be bought as commercial property. there is alreday a full cash offer on the place (k425) we will have deposit of 180/200 k depending on sale of my flat which is just going through. It was previously residential and don't imagine pp to reconvert would be an issue- there are precedents in the area.
    the tenants wish to remain and bring in 2000/month
    combined earnings of around 95 k gross.
    i read somewhere there would be 6% stamp duty- but am somewhat intimidated by the idea of commercial loan which i know nothing about, and entering bidding war with cash buyers. Going to talk to BOI about it but wondered if you had advice.

    many thanks if you are able to help

    Hi Scoops2,

    Did we not chat on the phone about this yesterday??


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