Getting your house valued

What is a house valuation?

A house valuation tells you how much a property is worth. However, terms around 'valuation' can refer to three very different services:

• An estate agent's property valuation (or market appraisal): An estimate provided to help you set an asking price when selling a property.

• Mortgage valuation: A report for a mortgage lender to make sure the property is worth what you're buying it for. The mortgage valuation is conducted for the lender's benefit.

• Home survey (or property survey): A valuation carried out by a qualified Chartered Surveyor.

How much do valuations and surveys cost?

The average cost varies significantly depending on the service you need:

• A property valuation from an estate agent is usually free of charge.

• A mortgage valuation varies depending on your lender and the property's value and can range from less than £100 to over £1,500. Some lenders offer free mortgage valuations as an incentive for choosing them.

• A home buyer's survey can start from around £300 to upwards of £1,000 depending on the level of survey you choose.

Who can give you an accurate house valuation?

For a formal, legally binding figure, only a RICS Chartered Surveyor can provide this. They offer an unbiased, expert opinion based on detailed analysis.

For selling your home, an experienced local estate agent can provide an accurate market appraisal. They use data on recently sold properties from sources like the Land Registry, combined with their on-the-ground knowledge of what buyers are currently looking for.

What is an estate agent's property valuation?

When you decide to sell your home, an estate agent will provide a market appraisal. This is their professional opinion on what your property is likely to achieve on the open market.

This service is usually offered for free in the hope that you will choose them to sell your property. The valuation involves the agent assessing your home's condition, size, location, and comparing it to recently sold properties nearby.

What is a mortgage valuation?

All lenders arrange to have a mortgage valuation, also known as a valuation survey, carried out during the mortgage or remortgage application process. This is to ensure that the property you're buying is worth the value you want to borrow. If you're remortgaging, it's to check that the level of equity held is accurate.

Getting a house valued as part of the application process is really to benefit the lender, rather than the home buyer. It's also a good idea to do your own research and arrange an independent property valuation, as well as a more substantial survey, to ensure that the property is in good structural condition.

What is a down valuation?

A "down valuation" occurs when the surveyor carrying out the mortgage valuation concludes that the property is worth less than the price you have agreed to pay.

This could lead to the mortgage lender changing the loan amount offered, or even withdrawing their offer, in extreme cases.

What you can do after a property has been down valued

The best first step is to try to renegotiate the sale price with the seller. The mortgage valuation report provides strong evidence that the property may be overpriced, which can be a powerful negotiating tool.

You could also try to challenge the valuation with your lender. However, this would be dependent on the lender considering your reasoning, and having solid evidence that the valuation is incorrect.

If you’re still unable to get the outcome you need in order to afford the home, you could either look at accepting the reduced loan and trying to find a way to make up the difference in value, or look at other lenders who may use a different surveyor and may come to a different conclusion.

What is a Home Buying Survey?

A survey is a detailed inspection of a property's condition, carried out on behalf of the buyer. Its purpose is to uncover any potential problems before you are legally committed to the purchase.

The main types are regulated by the Royal Institution of Chartered Surveyors (RICS):

• RICS Home Survey – Level 1: The most basic type of survey, best for new-builds and conventional homes in good condition.

• RICS Home Survey – Level 2: A more detailed report suitable for most conventional properties in a reasonable state of repair. It will highlight any significant issues.

• RICS Home Survey – Level 3: The most comprehensive survey available. It is recommended for older properties, listed buildings, unusual homes, or any property you plan to renovate extensively.

What’s the difference between a valuation and a survey?

An estate agent's market appraisal or mortgage valuation simply tells you what a property is worth, whereas a survey tells you what condition the property is in.

A mortgage valuation is not a survey. Its sole purpose is to assess value for the lender. It will not provide a detailed report on issues like damp, roof problems, or structural defects. For that, you need a Home Buyer's Survey.

How much does a RICS valuation cost?

It depends on the size and type of the property, but you should expect to pay from around £300 for a standard property to upwards of £1000 for more complex properties.

Can I get a house price estimate for free?

There are a number of free online house valuation tools you can use to assess how much a home is worth. They use data from the Land Registry to show what the home most recently sold for, but can also tell you what it's now worth based on an estimate. They typically provide an approximate figure, rather than a tailored valuation.

While useful for a quick snapshot, they are unlikely to be completely accurate and should only be used as a starting point. They cannot account for a property's specific condition, or the local market's nuances. It is not recommended that you base a decision to buy or sell solely on an online estimate.

When doing your own research, online home listings websites have sections that focus on purchase history. Looking at what properties have sold for recently can give you a better idea of what they might sell for in future. You should also research wider factors that affect desirability, such as:

• Local school ratings (e.g., Ofsted in England).

• Crime statistics for the neighbourhood.

• Environmental factors, such as flood risk, via the Environment Agency website.

Tips for a successful estate agent valuation when listing your home for sale

If you’re selling your property there are a few things you can do to help get the best possible estate agent valuation: 

• Ask multiple estate agents to provide an estimated value of your home, but don’t always assume the highest valuation is correct

• Highlight any features that may not be immediately visible when they visit your property, such as loft rooms or smart home features 

• Maximise the appeal of your home before the valuation; tidy up, redecorate and get rid of clutter

• Improve the outward appearance of your home, such as the front door and windows, as well as any surrounding garden