46% of buyers have had their prospective property down valued since March 2020, according to new research from Bankrate UK.
Of those properties that were down valued, 50% of these buyers were aged 18-34, in comparison to 37% of buyers aged 45 and over.
The results also revealed that homes valued between £400,000 and £500,000 have fallen victim to the most devaluations.
Buyers looking to purchase properties in Wales had the highest percentage of down valuations at 63%. In close second was the capital, where London homes saw 59% of their properties deemed less valuable by lenders. Next, buyers in Yorkshire and the North West had 58% and 56% of their properties down valued.
Conversely, homes in the South West have held onto their value the most, with 74% of properties holding their value through to completion. Second were homes in the East Midlands where 70% were not down valued, followed by Scotland at 56%.
Cottages were the property type that have received the highest proportion of down valuations at 66%, followed by 48% of semi-detached properties.
Almost half (44%) of homes include in Bankrate’s investigation were down valued between £5,000-£10,000. 24% of buyers revealed that their properties were down valued anywhere between £10,000-£20,000. However, some buyers reported that their potential properties had been down valued by up to £240,000.
First-time buyers (18-24) were yet again hit hardest with their mortgage valuations, with 33% discovering their dream property was deemed £20,000-£30,000 less than the agreed sale price. 30% of 25-34-year olds admitted to having their property devalued by £10,000-£20,000, whilst for buyers over 45, the majority of down valuations were between £5,000-£10,000.
Across the country, the most common devaluation seen was £5,000-£10,000, except in the North West and East Midlands who saw their homes down valued on average by £10,000-£20,000.
Although buyers can ask the seller to reduce their house price to cover the cost of down valuation, only 33% of those surveyed did so. Of those who did ask the seller to reduce the price, 72% had their offer accepted but 13% still had to increase their deposit to cover the cost.
Unfortunately, for those who received a down valuation they couldn’t resolve, only 2% confirmed they had since gone on to offer on another property.
Sam, a 30-year-old software engineer from Essex, told Bankate UK said, “In August I attempted to buy a semi-detached property in Billericay Essex for £450,000. My offer was accepted by the seller but following a survey from my mortgage lender, the property was devalued by £50,000.
“As the seller was unwilling to reduce their asking price, I subsequently lost the mortgage offer and the property, as I was unable to increase my house deposit to cover the cost of the devaluation.”