ozboy
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Post by ozboy on Mar 20, 2017 22:52:34 GMT
Isn't the SS DFL017 H***r R*w "Valuation" out by over £3 Mill?!! Can't recall anyone was able to uncover where that £3+ Mill fitted in?
Note, WE have to try and uncover where it went/goes.
Still, a Professional RICS Member produced it so it must be correct.
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ilmoro
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Post by ilmoro on Mar 21, 2017 0:14:26 GMT
Isn't the SS DFL017 H***r R*w "Valuation" out by over £3 Mill?!! Can't recall anyone was able to uncover where that £3+ Mill fitted in? Note, WE have to try and uncover where it went/goes. Still, a Professional RICS Member produced it so it must be correct. They seem to be convinced as they have reiterated the valuation or close to it in an (unseen) letter.
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Post by meledor on Mar 21, 2017 8:54:21 GMT
Isn't the SS DFL017 H***r R*w "Valuation" out by over £3 Mill?!! Can't recall anyone was able to uncover where that £3+ Mill fitted in? Note, WE have to try and uncover where it went/goes. Still, a Professional RICS Member produced it so it must be correct.
Out by £3 million? I don't think so but perhaps you had better explain where you get this idea from?
From the valuation:
"We understand that the Applicant had negotiated to acquire the offshore company as
the beneficial owner of the freehold interest in the Site for £9,500,000. Subsequent to this,
the Vendor confirms that it received four unsolicited offers for the Site, with the benefit of
the planning consent and as a result of this the price increased to £11,000,000."
The current market value is stated in the valuation report to be £10,647,000
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ozboy
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Post by ozboy on Mar 21, 2017 9:40:21 GMT
Check Rightmove/Zoopla/Whatever for the price they have been openly trying to sell for a couple of years now with PP.
If the offshore company contained "extras" we must be told so we can square their Value with the property "Valuation".
"Four unsolicited offers", where's the proof? This one is often used by Platforms without the slightest bit of evidence, there's always an "Unsolicited offer or three" kicking around to magically boost the "Valuation"
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Mar 8, 2017 at 4:38pm QuotePost Options Post by ozboy on Mar 8, 2017 at 4:38pm
Well, it's on Zoopla, right now for £7.5 Mill, including pp, how does that square with the £11,000,000 "Valuation" (scratches head)?!:-
7 bed block of flats for sale £7,500,000 (£1,620/sq. ft)
H***r R*w 4,631 sq. ft*
Basement and three upper floors
Property description
******* are delighted to bring to the market this exciting development opportunity with a **. H***r R*w is a knock down and rebuild scheme with planning permission for 6 lateral residential flats plus commercial (D2) space on the lower ground floor which could potentially be a gym to benefit future residents.
The existing end of terrace property sits on a site measuring c.196 sq mt and consists of a partial basement with 3 upper levels and a pitched roof constructed in brick and slate with its main frontage onto H***r R*w. The building has previously been used as a Pilates centre with residential upper parts.
The planning was granted on **** August 2014 for a knock down and rebuild mixed use scheme to comprise of 6 lateral apartments all with balconies (with the exception of the 4th floor flat) and with the lower ground floor unit benefitting from a courtyard garden. The proposed total net saleable area is 8300 sq. Ft.
Located a 5 minute walk from M********e High Street with all the amenities and boutiques that M*******e Village has to offer. C*******t village and H*** P*** are also a short walk. Ideally located for transport with M********e S*****n, E*****e R**d, and B***r S****t all within walking distance.
Notice
Please note we have not tested any apparatus, fixtures, fittings, or services. Interested parties must undertake their own investigation into the working order of these items. All measurements are approximate and photographs provided for guidance only.
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Post by meledor on Mar 21, 2017 10:50:57 GMT
Do you really think that planning permission added only £2 million to the property's value recorded at the last sale in 2013?
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ozboy
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Post by ozboy on Mar 21, 2017 11:05:10 GMT
I'm not in Property so I have no idea what uplift occurs when a property is granted PP, I imagine it varies hugely dependent on numerous factors.
With this particular "Valuation" example there's much that is misleading isn't there?
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Post by dualinvestor on Mar 21, 2017 11:31:50 GMT
I'm not in Property so I have no idea what uplift occurs when a property is granted PP, I imagine it varies hugely dependent on numerous factors. With this particular "Valuation" example there's much that is misleading isn't there? Land value obviously depends on its location and use e.g. an acre of crofters land in a remote part of Scotland is likely to be only a small fraction of an acre of the Grosvenor Estate in Mayfair. Taking a more realistic example land on the edge of a town will benefit hugely from first of all a change of use and then further by the grant of planning permission. Just what those two uplifts are is a matter of opinion. A valuer should use his professional judgement but will it only be a matter of well informed opinion. As long as a valuer is clear on the basis that he has come to the value then one has to accept it as what it is. For those who are not well informed and able to appraciate all the factors they should not accept it as if it were a black and white certificate of value. This is why it is a falacy to believe that non-professional lenders can undertake proper due diligence based upon the limited information usually available. One further factor that is almost always ignored in this forum. The security is a "pawn", in such circumstances it will only be relied upon if the borrower defaults and therefore is, at best, in a forced sale situation. If it is just a property we all have recent experience of the sale of a Garden Centre that realised barely 50% of its valuation and took nine months to do so, and another where Receivers were appointed six months ago. If it had been a development loan it would be lucky to realise half of that. Most borrowers only pay interest rates charged by P2P platforms because they are not a good credit risk therefore inherently poor prospects, which brings me to the conclusion that whilst I would like VRs to be accurate I don´t rely on them as they are very rarely an indication of the final realisation in the case of problems with the loan.
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Post by meledor on Mar 21, 2017 12:03:49 GMT
I'm not in Property so I have no idea what uplift occurs when a property is granted PP, I imagine it varies hugely dependent on numerous factors. With this particular "Valuation" example there's much that is misleading isn't there? OK let's put this another way. The Valuation Report identifies a 20% profit on cost for a GDV of £20.403 million which equates to £3.4 million. This assumes the borrower acquires the property for £10.647 million. Had the borrower been able to acquire at Rightmove prices (£7.5m) then profit would have been £6.5m or 47% on cost which I think is rather unlikely.
Of course you may think the development amounts quoted are incorrect as well but you haven't convinced me of your point that the report is misleading, merely that you are clearly suspicious.
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am
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Post by am on Mar 23, 2017 20:05:37 GMT
IMO the worst valuation to date was A****sey on AC. 1. AC hid the Valuation Report from lenders, but stated it at 69% LTV 2. When the loan was about to default, AC openly stated "We retain a First Legal Charge over the property and the refurbishment work has been completed improving the valuation from when loan was originally drawn down."
3. 18 months later, Lenders voted against 2 options to sell the property at a loss, overwhelmingly selecting a third option not to sell at a loss. (12% didn't vote). 4. AC then ran another lender vote without the third option, thereby forcing the property to be sold at a big loss. (64% didn't vote) . 5. From the increase in the NO vote it is clear that AC went against lenders wishes. 6. AC won't pursue the valuer. It stinks. The problem I saw with the A****sey property was that the valuation had a very large uncertainty (but VRs don't present error bars, so that isn't reflected in the VR); my view was that the valuation wasn't unreasonable for a property of that size, but that the valuation depended on being able to find a buyer with a use for the property, and that there was no guarantee that such would be forthcoming. If I recall correctly (I wasn't a participant in the loan) there was also a problem of work not being carried out on the property. If I'm right about the uncertainty, it would be hard to demonstrate liability on the valuer's part.
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shimself
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Post by shimself on Mar 23, 2017 20:26:06 GMT
The problem I saw with the A****sey property was that the valuation had a very large uncertainty (but VRs don't present error bars, so that isn't reflected in the VR); .. I rather thought that the 90day value represented a bottom end.
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stokeloans
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Post by stokeloans on Mar 24, 2017 7:59:15 GMT
I take the view that all valuation reports are weighted in the favour of those paying for it and not me the investor.
I take them all with a pinch of salt.I wouldn't trust one to value my garden shed accurately
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pom
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Post by pom on Mar 24, 2017 9:21:56 GMT
I take the view that all valuation reports are weighted in the favour of those paying for it a Definitely. When I got my grandfathers place valued for probate etc the surveyor told me she wasn't sure what value to put on it (in fairness to her at the point he died we'd had a promising response to a pre-planning submission but hadn't quite got the planning application submitted so there was a big element of "hope value") and offered 2 figures. Faced with a dilemma of a definite IHT bill at 40% on an extra 50k or potential CGT later on at 28%....well I chose the lower value. (in hindsight I wish I hadn't been in such a rush, as it turned out he fell under the "death in active service" loophole having got TB in WW2 so all the IHT was refunded anyway, but you win some you lose some...  )
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pikestaff
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Post by pikestaff on Mar 24, 2017 9:49:04 GMT
...Well, it's on Zoopla, right now for £7.5 Mill, including pp, how does that square with the £11,000,000 "Valuation" (scratches head)?!:- 7 bed block of flats for sale £7,500,000 (£1,620/sq. ft)... Not any more it isn't, but it can still be seen (slightly greyed out) on Rightmove, which says: "This property has been removed by the agent. It may be sold or temporarily removed from the market". Valuations for top end central London property are very dependent on sentiment. Prices have gone off the boil, so developers are going to be cautious and won't pay silly prices any more. Events this week (though post the above listing) won't help. Shortfalls of this magnitude may well become common. I will be avoiding London residential for the time being. PS Property valuation for anything unusual is a very inexact science. Recently I was the chairman of a charity which had to sell a property in need of refurbishment. By law, we had to get a valuation before selling and we were not allowed to sell below that. Our valuer, knowing this, valued the property at £700k. Our agent marketed it for OIRO £750k, asking for sealed bids by a certain date. There were four credible bids. The winner paid £900k. The next bid was £750k and the others were for significantly less.
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Post by harryvederci on Mar 24, 2017 10:54:38 GMT
the HR valuation is worked back from end values of £2,500 sq ft +, the London resi market agents/surveyors work on £ sq ft to location etc.
My experience is they're usually helpful and keen to chat on new builds, & its not rocket science to ring round saying you're looking to buy a xxxx sq ft off plan super new build in a side street in M to get an indicative £ sq ft range. I did and it maxed out at 2 for what its worth. All about informed opinions I suppose!
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Post by dualinvestor on Mar 27, 2017 9:16:56 GMT
The problem I saw with the A****sey property was that the valuation had a very large uncertainty (but VRs don't present error bars, so that isn't reflected in the VR); .. I rather thought that the 90day value represented a bottom end. In a forced sale situation properties will sometimes yield only a small proportion of the "perceived" value, whether that be open market or 90 day, particularly if there are special factors such as an uncompleted building project, which is why a percentage quoted by a platform LGDV, Loan to Gross Development Value, is wholly misleading in the event of borrower default. I say again security is only relied upon when the underlying property is in a distressed and it is very unwise to believe that any valuation is accurate in those circumstances.
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