Bank Valuation - Land Component

We had a bank valuation on a property we are purchasing and all was good as it came back at contract price so no issues.

The actual valuation broke down the valuation into the land component and the house/added value to reach the figure. I am curious that the land component was $71,000 under the listed UV value.

Is this just an oversight and meaningless as the final price is correct or does this leave room for the property to be worth more?

The potential buyers prior to us had a private market valuation done and the amount was actually very close to what the valuation was with the correct land value.

 

There is no harm in asking. If you obtain a copy of the private validation show them that as well

I actually enjoy talking to valuers as they have a good insight into market conditions

 

Thanks Ross, I'm not too concerned as I understand that bank valuations are always lower but was hoping for some sneaky equity if the valuation did increase to reflect the correct land value.

 

If it's an established house your buying it makes no difference. If it's a construction loan a short land val even if compensated by the build causes major issues.
Note valuers can have a 10% variance in any case.

 

Not an oversight, just meaningless. The valuer needs to get the right answer at the bottom (contract price), so numbers are massaged to get the right answer.

 

Thanks Tobe, yes established home.

 

Thanks Alan.

 

If you want equity release in the short term get a broker to do a desktop/avm prior to the sale being registered. There's a few on here talking about it, but I haven't had experience with this strategy. Otherwise give it 3 to 6 months and get another val done.

 

FYI,

For purchases, most of the vals I see use the council land valuation (or very close to it) and then the "improvements" are slapped with whatever the difference is between sale price and land val.

Sometimes it's hilarious when a client has bought a house in good condition way under value:

e.g.

Land: $550,000
Improvements: $80,000
Replacement value: $300,000