littleoldlady
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Post by littleoldlady on Jul 28, 2016 10:48:17 GMT
I have noticed that SS often do not use a local agent to do valuations. They seem to have favourite agents who are asked to do valuations outside of their normal area. This may be because SS have a special relationship with them on costs, and it is important to lenders as well as SS that they keep tight control over platform costs. But I wonder if this is a false economy. Personally I am not knowledgeable in this area - is there anyone reading this who is?
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boble
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Post by boble on Jul 28, 2016 13:08:10 GMT
I have noticed that SS often do not use a local agent to do valuations. They seem to have favourite agents who are asked to do valuations outside of their normal area. This may be because SS have a special relationship with them on costs, and it is important to lenders as well as SS that they keep tight control over platform costs. But I wonder if this is a false economy. Personally I am not knowledgeable in this area - is there anyone reading this who is? I notice that they use Aztec quote a lot. They are in effect a valuation brokerage, which agrees fees with willing valuers for a generous commission. I don't favour this process, however, it can be useful sometimes. Aztec are quire aggressive marketers to lenders and brokers. In my view SS should be using a national firm such as Savills, however, they are quite expensive so would need to negotiate discounted terms for multiple instructions.
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Post by dualinvestor on Jul 28, 2016 13:25:54 GMT
I have noticed that SS often do not use a local agent to do valuations. They seem to have favourite agents who are asked to do valuations outside of their normal area. This may be because SS have a special relationship with them on costs, and it is important to lenders as well as SS that they keep tight control over platform costs. But I wonder if this is a false economy. Personally I am not knowledgeable in this area - is there anyone reading this who is? As with so many things in P2P you have to take your own view. It is not unusual for any lending institution to have a "panel" of valuers, the banks will usually offer this sort of work out to tender on a regional and national basis, where it is straight land and/or buildings they will have general qualifications but they will often loook for specialists in specific areas, e.g. licenced premises, liesure facilities, development land etc etc. Very large firms of valuers/surveyors will often offer specialist departments under one umbrella. I have not looked at many valuations on SS so will have to take your statement that there are a limited number of valuers used by the platform. I have heard complaints, on other threads, that many of the valuations do not meet the high standards set out in the Royal Institution of Chartered Suerveyors "Red Book," they certainly did not on PBL20. Under normal circumstances a bank, when assessing security, will have three different values, "Going Concern" "Open Market" and "Forced sale" as SS is usually operating with sub optimal propositions it is arguable that they should be more cautious in their valuation assessment and use the lowest in assessing loan amount. It is IMO, as you say, a false economy to not use the best available advice, but you must remember it is SS who pays the cost and the lenders who take the risk so it could be said a conflict of ineterest.
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littleoldlady
Member of DD Central
Running down all platforms due to age
Posts: 3,045
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Post by littleoldlady on Jul 28, 2016 13:45:03 GMT
I have noticed that SS often do not use a local agent to do valuations. They seem to have favourite agents who are asked to do valuations outside of their normal area. This may be because SS have a special relationship with them on costs, and it is important to lenders as well as SS that they keep tight control over platform costs. But I wonder if this is a false economy. Personally I am not knowledgeable in this area - is there anyone reading this who is? I notice that they use Aztec quote a lot. They are in effect a valuation brokerage, which agrees fees with willing valuers for a generous commission. I don't favour this process, however, it can be useful sometimes. Aztec are quire aggressive marketers to lenders and brokers. In my view SS should be using a national firm such as Savills, however, they are quite expensive so would need to negotiate discounted terms for multiple instructions. Interesting. Well at least can we assume that the valuation would have actually been done by someone familiar with the local area, under sub-contract to Aztec?
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boble
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Post by boble on Jul 28, 2016 21:02:13 GMT
I notice that they use Aztec quote a lot. They are in effect a valuation brokerage, which agrees fees with willing valuers for a generous commission. I don't favour this process, however, it can be useful sometimes. Aztec are quire aggressive marketers to lenders and brokers. In my view SS should be using a national firm such as Savills, however, they are quite expensive so would need to negotiate discounted terms for multiple instructions. Interesting. Well at least can we assume that the valuation would have actually been done by someone familiar with the local area, under sub-contract to Aztec? Regrettably, in my experience this isn't always the case.
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Post by harvey on Jul 28, 2016 21:21:09 GMT
I consider local knowledge to be very important. Indeed for a professional valuation to be compliant with RICS valuation standards it has to be carried out by a qualified valuer with the necessary experience and expertise to undertake the task and that is something that should really be confirmed in the report.
Some people argue that with all the various databases that are now available that people can sign up to containing all of the sold property records across the country and given that valuers can pick the brains of their peers in other areas and do research from the informed position of a property professional, that they should be able to value something anywhere with competence. However I disagree. While it may be quite easy to value a house on a housing estate and it may be easy to obtain good comparable evidence for that valuation, things are not so easy when it comes to valuing more specialised types of property and development land etc. In those situations I would want to instruct a local valuer with local knowledge.
However if a valuer is approached to provide a valuation that he doesn't believe he has the necessary experience and expertise to provide then he should decline the instruction on that basis because to do otherwise would be a breach of his professional obligations. Therefore when valuations have been provided by chartered surveyors then we must assume they have the necessary expertise and experience to undertake the job they have been asked to do, regardless of their physical location.
But if I wanted some land valued in Bath I would not instruct a valuer in London or Lancashire to advise me. I would find somebody who was based in that part of the world and who practised in that area on a regular basis. Also I would not want to pay for all their travelling time to get from Lancashire to Bath and back just to the inspection.
As long as the valuation has been provided by a qualified valuer then I am usually satisfied and I trust their competence. Most issues I have seen here regarding valuations have arisen from poor instructions and valuers being asked to make certain assumptions and value on a particular basis even when that is an unrealistic scenario. I am never happy when big loans are given out on the back of cheapo, back of a fag packet estate agent letter type valuations, although that early practice seems to have been replaced by much more thorough reports.
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romy
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Post by romy on Jul 28, 2016 21:39:31 GMT
Whilst having some sympathy for the view advocating local knowledge, I would also want to use someone who had specialist knowledge of care villages/ student accomodation/developments of whatever which might necessitate at least a regional firm if not national.
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Post by harvey on Jul 29, 2016 12:10:06 GMT
Whilst having some sympathy for the view advocating local knowledge, I would also want to use someone who had specialist knowledge of care villages/ student accomodation/developments of whatever which might necessitate at least a regional firm if not national. Good point. I agree.
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