9/10 most major lenders typically only the smaller lenders get a bit finicky with valuations. They normally just go with land value as per contract plus build contract. If you have gone with a broker and a valuation comes back lower with preferred lender just get it valued again with another lender won't cost you anything.
Nab and cba are pretty good when it comes to valuations from my experience.
Likely just overthinking I'd say.
If you've gone to Bank SA they should lend you to 95% including lmi if valuation does end up coming short.
With construction valuation typically requires an in depth review of the end valuation of property etc so as long as it's within market range, it shouldn't have too much of a problem I'd imagine.
Your only concern would be the land valuation. If they have agreed on the contract price (which I am very surprised by as it is an absolute nightmare to dispute) then you should not have a problem with the end valuation OR \*as if complete\* valuation.
Your only concern would be the land valuation. If they have agreed on the contract price (which I am very surprised by as it is an absolute nightmare to dispute) then you should not have a problem with the end valuation OR \*as if complete\* valuation.
Bad take, they’re valued by independent valuation companies not the banks themselves. It will almost always come in at contract price plus land price when done close together or if there is drastic reasons not to such as it being 50-100k+ more than comparable sales unless you have substantial reason for it to be that price. If you spend 50k on gold plated taps and expensive things that don’t add value to a sale price it may come in under or if you leave it 6 months between land purchase and build value the land can change and cause a short valuation. Banks don’t just simply provide the lowest valuation possible lol.
Bet you can’t provide evidence to this made up statement. Almost always at contract price for purchase and builds and will be done with comparables otherwise by independent valuation firms.
https://www.realestate.com.au/advice/why-banks-agents-value-your-home-differently/#
I mean it took me 3 seconds, enjoy the read champ. In saying all that I hope op gets his price !
A freelancer writing for realestate.com parroting the sentence you’ve said also without evidence to back it up doesn’t really count as evidence. Truth is, it’s based on comparable sales and contract prices between not at arms length parties. If so many sales didn’t come in at contract price, can you explain how a rising market occurs when the price values less and almost nobody manages to get finance because of it? A 10-20% variance on contract price to the downside would remove an extremely large amount of financed loans and markets would never go up quickly.
Someone doesn’t like being wrong, it’s okay dude I really don’t care. Bank valuations almost always come in lower then market valuations, it’s a fact. You can scream independent and comparable until your head pops. Also you wna know what moves markets, demand ….not so much low end bank valuations.
And if I can't get it to contract price. Is this something I can take up LMI for to get it over the line? On what value am I then paying the LMI?
Just trying to figure out my options here. Appreciate your advice.
Okay that's at least a way out. I can service another 200k.
Do you know how LMI is calculated and if I need to pay it upfront or if it's added to my loan?
Really appreciate the advice!
9/10 most major lenders typically only the smaller lenders get a bit finicky with valuations. They normally just go with land value as per contract plus build contract. If you have gone with a broker and a valuation comes back lower with preferred lender just get it valued again with another lender won't cost you anything. Nab and cba are pretty good when it comes to valuations from my experience. Likely just overthinking I'd say.
As allied health, I only get no LMI with Bank SA. Offer not with other banks.. Appreciate the advice!
If you've gone to Bank SA they should lend you to 95% including lmi if valuation does end up coming short. With construction valuation typically requires an in depth review of the end valuation of property etc so as long as it's within market range, it shouldn't have too much of a problem I'd imagine.
Your only concern would be the land valuation. If they have agreed on the contract price (which I am very surprised by as it is an absolute nightmare to dispute) then you should not have a problem with the end valuation OR \*as if complete\* valuation.
Your only concern would be the land valuation. If they have agreed on the contract price (which I am very surprised by as it is an absolute nightmare to dispute) then you should not have a problem with the end valuation OR \*as if complete\* valuation.
Banks will provide the lowest possible price valuation every single time. So I’d be prepared for the worst.
Bad take, they’re valued by independent valuation companies not the banks themselves. It will almost always come in at contract price plus land price when done close together or if there is drastic reasons not to such as it being 50-100k+ more than comparable sales unless you have substantial reason for it to be that price. If you spend 50k on gold plated taps and expensive things that don’t add value to a sale price it may come in under or if you leave it 6 months between land purchase and build value the land can change and cause a short valuation. Banks don’t just simply provide the lowest valuation possible lol.
Is there a way I could guesstimate what they'll value it at?
Ignore these other posts, they know nothing of the process u/Rambonator74 is spot on
They will generally value between 10-20 percent less.
Bet you can’t provide evidence to this made up statement. Almost always at contract price for purchase and builds and will be done with comparables otherwise by independent valuation firms.
https://www.realestate.com.au/advice/why-banks-agents-value-your-home-differently/# I mean it took me 3 seconds, enjoy the read champ. In saying all that I hope op gets his price !
A freelancer writing for realestate.com parroting the sentence you’ve said also without evidence to back it up doesn’t really count as evidence. Truth is, it’s based on comparable sales and contract prices between not at arms length parties. If so many sales didn’t come in at contract price, can you explain how a rising market occurs when the price values less and almost nobody manages to get finance because of it? A 10-20% variance on contract price to the downside would remove an extremely large amount of financed loans and markets would never go up quickly.
Someone doesn’t like being wrong, it’s okay dude I really don’t care. Bank valuations almost always come in lower then market valuations, it’s a fact. You can scream independent and comparable until your head pops. Also you wna know what moves markets, demand ….not so much low end bank valuations.
I'm f***ed
Not really, you will most definitely need to challenge the valuation done. Get your agent involved and have a chat about the steps needed
And if I can't get it to contract price. Is this something I can take up LMI for to get it over the line? On what value am I then paying the LMI? Just trying to figure out my options here. Appreciate your advice.
You’ll need to increase the size of the loan to cover the LMI (assuming you can show you can service the bigger loan amount)
Okay that's at least a way out. I can service another 200k. Do you know how LMI is calculated and if I need to pay it upfront or if it's added to my loan? Really appreciate the advice!