Valuations and mortgagee sales

Discussion in 'Loans & Mortgage Brokers' started by Meteor, 20th Apr, 2017.

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  1. Meteor

    Meteor Member

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    I recently had a valuation done for an apartment with the intention of refinancing if the valuation came in under 80% LVR.
    Unfortunately, a very comparable apartment in the same building was sold a month ago but at a low price due to it being a mortgagee sale.
    Would it be worthwhile for me to go back to the bank and request a review of the valuation or does it make no difference because the 'market' has spoken and that is the market value of the property?
     
  2. Otie

    Otie Well-Known Member

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    I don't think they would make any alterations to it as mortgagee auction doesn't mean the property was sold cheaper, would still have sold at market value as bank has responsibility to get the highest possible price for it
     
  3. Propertunity

    Propertunity Well-Known Member

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    Wait 6 months for that sales data to 'wash thru' and be replaced by (hopefully) higher value sales.
     
  4. Terry_w

    Terry_w Lawyer, Tax Adviser and Mortgage broker in Sydney Business Member

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    a mortgagee sale at auction is by definition sold at market price so i think you won't have much luck challenging the val.
     
  5. Corey Batt

    Corey Batt Well-Known Member

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    Agree with the others here - just because its a mortgagee sale doesn't mean it would represent a cheaper sale. It's just a sale like everything else.

    There's a common misconception that banks just fire sale any mortgagee - that isn't the case. The last thing the bank wants to do is sell the property undervalue and then have the vendor object and try claim back inferred losses.
     
  6. Redom

    Redom Mortgage Broker Business Plus Member

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    Unfortunately this is one of the theoretical downsides (financing part) that some property advisors mention when purchasing in apartment complexes where comparable are dictated by more uniform comparables vs houses/limited stock dwellings.

    Best to wait, or order vals from other lenders rather than challenging existing val.
     
  7. Rolf Latham

    Rolf Latham Inciteful (sic) Staff Member Business Plus Member

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    an auction outcome doesnt determine the market price, the valuers valuation and recent comps do, except when................

    ta
    rolf
     
  8. Peter_Tersteeg

    Peter_Tersteeg Mortgage Broker Business Member

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    When agents advertise a 'mortgagee sale', everyone shows up hoping for a bargain. In a hot market, it's not going to be a bargain.
     
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  9. Meteor

    Meteor Member

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    Thanks everyone. I will let this go and try for another valuation at another time.
    According to the sales history on onthehouse, the apartment was sold for $535k in July 2011 and $520k in June 2015. It was sold last month for $450k, hence why I thought it being a mortgagee sale has affected the sale price.
     
  10. Meteor

    Meteor Member

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    I don't understand, can you please fill in the blank?
     
  11. tobe

    tobe Well-Known Member

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    Where is it? 3 sellers taking a bath in succession....
     
  12. dabbler

    dabbler Well-Known Member

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    That is a bugger when that happens, I had it happen somewhere when doing val, but the place had serious structural problems that could not be seen, sometimes you have to just wait and try again later.
     
  13. Meteor

    Meteor Member

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    South Melbourne... lots of apartments around.
     
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  14. Rolf Latham

    Rolf Latham Inciteful (sic) Staff Member Business Plus Member

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    except when the valuer wants to suddenly make that ONE sale an issue.

    Statistical outliers are called that for a reason :)

    ta

    rolf
     
  15. dabbler

    dabbler Well-Known Member

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    I would think Mel apartments of the average kind would be getting put under a lot of pressure, as would some of Sydneys & even if the valuer comes back with something favorable, lender can decide to lend a lower amount.

    Unfortunately, we are at that point or position when things are not as rosey.
     
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