Roll with the punches

4th August 2021

Not so good news on our recent valuation of £1.5M, which we contested.  Though in truth we were expecting the valuer not to change their mind; if they did so it would mean in short, they do not know what they are doing.  And no professional likes to acknowledge that, especially from a ‘lay person’.


In retrospect, what we should have done was to get a private valuation instructed first, and then let the lender appoint their valuer.  Valuers are less likely to contradict each other.  I mean how would it look if professionals from the same body contradicted each other?  Each valuation stays on a central database and is accessible to other valuers.  This then sets the benchmark.


It’s easy to give recommendations retrospectively.


We have decided to push the button and implement the remortgage, as it takes our client off the bridge, which is not a good place to hang out on for too long.  A bridge is supposed to take you from one place to another, it’s not a place where you should idly hang out.


In the greater context of the deal, the valuation is not bad at all.  The whole building was purchased at £1.2M, the valuation is for about 1/3 of the building and has come in at £1.5M.  The other 2/3 is being worked through for planning, which will be done in three phases, with phase 1 already in place.


Originally, we were looking to do the work in a piece meal fashion, as the planning comes in to then build out. However, there are issue like reinforcing the ground floor in the event we get planning to extend upwards.  Therefore, it made more sense to wait till it was all in place before pressing the button on the implementation.


The market at the moment is a hot one.  Yes, you can find deals, but they will not land on your plate.  One needs to hunt and look for deals which are not plain vanilla, but also make sure they are not too tutti frutti, but just enough so you can solve the issues involved.


We have previously acquired properties with enforcement notices on them, unknown tenancies etc.  This means you have to be prepared to dig deeper into the issue prior to purchasing the deal.  This involves time, energy and money, and may result in nothing; however, win or lose you’re building muscle.


There is also the element of gut feel, which is something which gets refined with time and experience.   Soon I suspect the market will take a dip and more people will be selling; not because they wish to, but because they have to.


Suresh Vagjiani

Suresh Vagjiani
Suresh Vagjiani
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