Property sales and remortgage deals are falling through because mortgage lenders and surveyors are undervaluing homes, according to the National Association of Estate Agents (NAEA).
The group said lenders could be undervaluing residential properties by as much as 10 per cent and that this is having a detrimental effect on the number of UK property transactions.
It further claimed that surveyors were being over cautious because they feared being sued by lenders . However, this was denied by the Royal Institute of Chartered Surveyors, which said it was dealing with a market with a lot of "imperfections".
According to the NAEA, nearly two-thirds of estate agents (65 per cent) who took part in a survey said property sales had fallen through as a result of down valuations, while 86 per cent had seen further negotiations take place as a direct result.
Peter Bolton King, chief executive of the NAEA, said: "Our members have heard in several cases that lenders gave specific instructions to their valuers as to how they should approach these valuations."
"We all know that valuation is not an exact science and you can understand under current market conditions people erring on the side of caution. But is it fair that they value a property based on what might happen in the future rather than what is happening today?"
He explained that by undervaluing properties, sellers have to drop prices and homeowners who are looking to remortgage their home "are left with little room for manoeuvre".
"Whilst I understand that lenders are operating under severe constraints, it is neither fair nor ethical for valuations to be lowered on the basis that it might reduce exposure to competitive loan rates," King added.
But the Council of Mortgage Lenders (CML) said it only works with independent, trained valuers who have a duty to give accurate valuations.
Site Map |
About estateagents.co.uk |
Contact |
Terms & Conditions |
Links |
Press |
Estate Agents Login | 
© 1999-2009 estateagents.co.uk
© 1999-2009 estateagents.co.uk