Interested to get a condo, selling price RM 400k
However bank value it at RM 360k only.( from 3 different bank)

It is normal?

why don't ask the seller to lower the price to 360k then?

what bank that u have check the market value with u? actually im from hsbc. if u not mind i can help u to process =)

Thats normal I guess, in fact I recently had the same case.

call a few valuers... ask your loan officer for a list of valuers and give a few of them a call. they can give you an indicative value by phone. from experience, some of them have lost touch with the market and give absurd values. if you call a few, hopefully you get one that matches your buy price.

Have try but he refuse

direct purchase or via agent....
if direct - kinda hard... try to get frm banker outside the area...
ask them to assist ya...
if agent, wth is he/she doing...
they shld know some valuer that can offer tis price and often a certain bank...
@ present, most strategic location bank value cant catch up...

I have try hong leong, ocbc.

My agent doesn't seem to know, so called Senior realtor... sigh.. anyway good luck to TS (btw in my case, I'm not buying but selling)

wow....u still wanna buy even though u know it is 10% above market price

maybe its an early sign that banks tighten credit facility for subsale properties....unless bought from developer,subsale market price quite tricky coz maybe there is an element of mark-up price etc etc...

Question is, it is normal for bank to value the property below market rates?
I have see some other unit in the same place selling more expensive than the one i want

from experience, this is very common... these valuers just follow their stupid procedures that most times do not reflect market values... especially for areas that do not have many transactions...

oh ic.

It is very common nowadays. Most of the bank value cant catch up with the market value.

Yeah, pretty normal...
some bank oni have several panel valuers...
if those valuer are frm outside... how can they match up asking price...

So true, that's y, u have to depend on agent to rekomen...
wat's the point of being an agent if they cant advice seller...
nor assist buyer in seeking "prefered" valuer and banker as well as lawyer (best discount )
takken take commission buta nia...
e.g. in Setia Alam, chk personally wif some banker, 1st or 2nd request normally kena reject...
then bank will source for oth panel... and finally agree to match asking price...
but for most agent, confirm they know which valuer and bank panel to use...
btw, bankers are usually frm PJ/KL branch (not Klang or Setia Alam branch)...
there's always some loose strings out thr to make it possible (Msia boleh mah)...

Yes, the agent will hv lobang. In SA, i think cimb can offer highest value among all banks.

So TS u may try to contact cimb bank too.

Valuers don't understand property market, as simple as that

Yeap hear CIMB offer higher value as well.

Anyway there was 1 mortgage broker say that ocbc can match the asking price but another loan officer from ocbc say cant. Headache.

i think there's a general formula in finance that's used to value property. It is good to do our own estimation

I think is like this (simplified version) :

property value = operating cash flow (one year) (a)/ capitalization rate (b)

(a) operatin cash flow = rental - operating expenses (i.e: maintenance fees paid to management office + maintenance cost of the property like repairing works on the condo/house)

(b) capitlization rate can be your expected return.

Example 1:

condo can be rented out RM2K a month, maintenance fee: RM200 a month, miscellaneous cost (quit rent/insurance/repair works) on average RM100 per month.

you want 5% return

property value = (2000 - 300) * 12 / 0.05 = RM340K

if you buy the property above RM340K, your return is lower than 5% and vice versa.

Rearrange the formula to find out the return.

Example 2:

property cost: 400K
rental - operating expenses = 1500

Return: 1500 * 12/ 400000 = 4.5% per annum.

Of course can add "capital appreciation to the numerator" but this part is not certain/ until realised (sold your property) only is fair to take into consideration.

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Added on January 19, 2011, 11:26 amI also got a ridiculous offer for a property.

wanna sell 470K, bank value 360K only. i just gave up

This post has been edited by godutch: Jan 19 2011, 11:27 AM

Normal lar for the buoyant market nowadays....

But bottomline is don't deviate by 10% from the valuer final quote lor...more than that only cash rich afford. Imagine fork out downpayment + top up another 100k for the value difference.

But as far as I know, people still buy if they really like the proprety a lot, 100k is nothing for the cash rich...

Thumb up.

This post has been edited by limfgn: Jan 19 2011, 12:04 PM

Very Normal things..

http://www.themalaysianinsider.com/busines...ith-rents-down/

someone posted the above artile in another thread, i just borrowed the link. better take into consideration when wanna buy overvalued property.

i would say what normal nowadays is all real estate agents selling at a really really high marked up price (no offence to agents) due to so-called "current market sentiment" despite actual land value and such (as advised or valuated by bank valuer).

The result: you will have to put a downpayment way more than the 'normal' 10percent if you still want to go for the unit as bank still only offers 90percent maximum from the valuer's price.

for a friend of mine, it meant 3% booking fee "burned" cause he had to back out at last minute and the agent and owner blames my friend for not valuating the unit at first and since booking fee paid is non-refundable (or so they say).

in my case, i avoided such case, it was ridiculous to hear the agent explained that another unit was bought by a singaporean at the 'inflated price' so all owners also don't want to sell at lower price than the "market price" so called. even had an opportunity to meet an owner who said his previous agent marked up too high until 1 year also cannot sell his house so finally change to another agent. I really dunno whether owners/agents playing with the price or really "market sentiment".

in any case, i'd just use own due diligence. cheers and no offence to anyone.

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Added on January 19, 2011, 3:08 pmoh by the way, if you need to still buy the unit, "something" can be worked out between agent, valuer and bank officer to offer the needed loan...thats how the market price is keep on rising and way above so called market value. but dont buy when the "market sentiment" is going down...

This post has been edited by attahun: Jan 19 2011, 03:08 PM

If bank already says that the property is overpriced, why do you still want to purchase it.

And if you insists on buying an overpriced property, then you just have to come out with more downpayment.. simple. The bank is not going to take risk loaning money to an overpriced property.

Nowaday most of the valuer is either sleeping or living in cave....i am facing the same issue with house market value at 600k, valuer only value at 480k, especially when the place have less transaction, they will just estimated from last transaction and add up minimum increase, last transaction could be last year, a year different is huge!

so far only come across valuer report lower than market price... start from -rm20k...

how do you know house market value is 600k? please share.
because all the asking price is ~600k in the area? doesn't reflect market value now does it? reflects asking price.

This post has been edited by Jason: Jan 19 2011, 04:35 PM

for landed housing, usually renovation will be valued at half the renovation value...

For example 200k, valuer max want to give you 100k-150k only. They tend to be conservative in giving value to renovated properties.

i am from OCBC.

Actually a valuer is an independent entity en-paneled to various banks in Malaysia. meaning to say, the valuer is can be a representative of OCBC & PBB, HLBB,UOB, HSBC etc etc at the same time.

The valuation of the property is always based on the recent record in their database, if there is no supporting info, they could not easily say the property is valued at the selling price.

The reason is if the borrower defaulted the loan(means did not pay the loan and caused the loan account to turn into a bad debt), the valuer is responsible if they give a high valuation. that is why it is always best to ask the people, who has recently bought their property at your buying area, which bank they applied for the loan.



This post has been edited by kok_pun: Jan 19 2011, 05:05 PM

when surrounding similar property transaction at 540k, your property with extra land and renovation, do you sell at 480k?

How to know people who bought the property at my buying area?

depends, if surrounding similar property transaction at 540k, it could be because that property was renovated, comes fully furnished, is a corner unit, well maintained etc. 480k could be for intermediate, very run down unit, leaking sewage, cracks on the wall, roof already eaten away by termites and somebody suicide in there.. i would be very glad if i can sell it for 480k and run off with the money.

if you are basing valuation on last transaction, then what is YOUR VALUER doing wrong. you said he is basing it off last transaction price of similar units. just because you are willing to pay more doesn't reflect its value.

but we both would agree that value is subjective. i have no information, but indeed your valuer could be lazy. find a few other valuers. if all of them come to same conclusion then you are over-paying for it.

actually to overcome is to save more cash to top thing up

i'm the seller la, 600k is my offer price, i just pity my buyer could not get 90% loan, nothing i can do, price is fixed!

it is almost a norm these days with the asking price way higher than valuation. which explains subsales going slower.

examples from my recent viewing.

asking RM480k, valuation RM400k
asking RM350k, valuation RM280k
asking RM260k, valuation RM210k

as sellers we always ask for more, its normal but what we ask for may or may not reflect the true value.

as the seller, then you are doing great

value is depending on the market. if the sellers are all asking for high price and still selling like hot cakes, valuation will catch up.

i think this is normal nowadays.
i also facing this issue. bought at 345k valuation 320k.

makes you feel like buying from developer... all these issues are non-existent!!!

Yup, it is normal

normally b4 buying a property, i will ask the last trsc price at that area(most recent 1) and also the bank valued price... then from there i can know the price offered is it reasonable... and at the same time will make it as a reference to my banker...

of coz diff unit diff value, especially some unit have ready tenant then it can have better value...

encounter the same problem.
selling price 270-280
valuation price 230-250 (depend on reno)

for me better find a house within valuation price
or u ended up buying more than the price it shud be

iyooo.... if like this will be very hard time for me.
I only have limited $.
which planned to take out EPF account 2, just to pay off the 10% down payment (+ some self furniture, elect, etc...)

like this really can't my house from used unit

if really need to buy new unit, then i will need to wait at least 3 years :S

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Added on January 27, 2011, 7:37 pmJust browsing through others topic, and found this.
http://forum.lowyat.net/index.php?showtopi...post&p=39482520

makes me even lost hope in buying a house myself.

This post has been edited by Pressley.Q: Jan 27 2011, 07:37 PM

That is best scenario but try that on Landed properties in Bangsar, TTDI, OUG, Taman Desa and tell me whether it will work...

99.9% of the time, very hard. Demand > supply, simple theory.

as for own stay...nothing we can do if we really need the house
as for investment, better find other good areas

Valuer is Zzzzzzzzzzzzz, in Bdr Kinrara, do you know that some of the valuers value lower than than the developer's price, it happen to Emerald, Desiran and Sapphire, they just do understand the property market

Some time the issue is not that the valuer value lower than the mkt price, but they value too high, I quote a real example :-


We must understand that in the eye of the valuer, building has value, but in actual fact, some very old building dun have value at all..

I have a friend who owns an unit of bungalow in OUG (Jln Hujan Emas X), this bungalow is damn old like an Indian temple, land area 7K, build-up 6K, he called a Hong Leong valuer, the results is 1.9 mil, becoz the valuer said land value 1.4 mil + building 500K, this made my fren so happy & he priced 1.95 mil then, until today cannot sell. I assure whoever buy this bungalow will demolish the entire building, many buyers offer 1.25 mil-1.4 mil max, so does the stupid valuer did the right thing?

Valuer Zzzzzzzzzzzzz, they dun understand the mkt

thru property agents.... this is one evidence of the importance of their role

agents these days only want %$..$ they don't really help..especially when ur a 1st time buyer.

bangsar, etc... for houses in very matured areas, valuation is almost at mkt price since the history is established, banks have good reason to value higher as operating procedure.
vast majority of new ones in new areas can't get close to bank valuation - because they are new and because sellers are asking high at this time.

agents try to get 2%, some settle for 1%, even co-broke, etc. problem is coming more from sellers.
if you read the other threads and other forums, you'll find the majority subsellers are pricing sky high, no-sell, keep, rent for now - that kind of sentiment.

it'll all come to equilibrium again - loan not enough and no cash, no buy. when the cash rich buyers run out, nervous owners will drop price and let go cheaper. when, who knows?

willing buyer willing seller...
second - seller just main shout price... thats where valuation price came in. dont forget, agent will always try sell high for more comm $

3rd- valuer only based on transaction record. therefore for area which is not so active in selling, u may face this issue.