ING Direct mortgage valuations set new houses at second hand prices.
If you want an ING Direct mortgage for a new house you may find the lender values a new-build home on the same basis as a second-hand property. Some lenders have criteria that is there to eliminate any price increases for new-build and reduce the price of newly built homes.
Concern that new-build premiums disappear as soon as a house is sold leads lenders to instruct their surveyors to value all homes as if they were second hand even if they are newly built. In the past Leeds Building Society and Nationwide were among the largest lenders who carried out valuations in this way but in 2011 both changed, agreeing to instruct their valuers on a new-build basis.
With an ING Direct mortgage it is understood that new-build homes are still valued on a second-hand basis but ING Direct is said to be reviewing its policy because of market conditions.
It is suggested that new homes are often customised for a specific buyer, for example with kitchens and decoration, to a particular buyers taste. Lenders suggest that the next buyer may not want to pay as much for someone else’s ideas. There is also concern that there could be adjustment of the sale price of new-build properties and the second-hand valuation avoids this.
If you are looking for a mortgage for a new build property, comparing valuation criteria such as for the ING Direct mortgage is important. At Deal Direct we are familiar with lenders criteria for different products so give us a call so that we can advise you on this and other issues.
