Editor's note: This brief was summarised by The Property AI Newsroom from a report by Mortgage Solutions. Read the original article for full details.

Valuers Challenge 'Down Valuation' Claims in UK Property Market

Recent commentary in the UK property sector has focused on the concept of 'down valuations', a term used when a property valuation comes in below an agreed purchase price or a homeowner's expectation. However, according to a report by Mortgage Solutions, valuers do not recognise 'down valuation' as a formal concept and caution that the term can misrepresent the valuation process.

The report, authored by Matt Ison, associate director of technical services at Countrywide Surveying Services, explains that valuers provide an independent opinion of a property's market value at a specific point in time. This valuation is not intended to confirm the hopes of buyers or sellers, but to assist lenders in understanding the true value of the property as security for lending decisions.

Ison notes that while the agreed sale price in a purchase transaction is relevant, it is only one factor among several. Valuers also consider recent sales evidence, local market activity, the property's characteristics, and wider market conditions. If the evidence supports the agreed price, the valuation will likely reflect it; if not, the valuation will be based on the available evidence.

The report also distinguishes between purchase and remortgage valuations. In remortgage cases, there is no agreed sale price, and valuations are often compared to homeowner estimates or automated figures, which may be influenced by previous market conditions or optimism. These situations are not directly comparable to purchase valuations and should not be grouped together under the same headline.

Mortgage Solutions reports that there is no evidence of a sudden or widespread increase in valuations falling below agreed purchase prices or homeowner estimates. The data indicates that the proportion of such cases has remained broadly consistent, with no sign of a systemic shift.

This clarification is particularly relevant for letting agents and inventory clerks, who may encounter concerns from clients about valuations. The report emphasises that variations between expectations and valuations are a normal part of the market, especially given current affordability pressures and changing market conditions.