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House valuation - how to get a house valuation

Regardless of whether you're buying or selling a home, or even if you're just curious about what's out there, a property valuation can be an important tool when venturing into the property market.

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What is a house valuation?

A house valuation will tell you about the property and how much it might potentially be worth or cost to buy. Depending on where you go to get a home valuation, that information will be accurate enough for you to go ahead and make a home buying or selling decision.

You might want your own home valued so you can decide if it's a good time to sell, or to get a better sense of how much equity you might have in your home to get another loan.

When would you need to consider a house valuation?

If you're buying a new home, check the home values in certain areas or streets so you can compare where might be best to move to within your budget. If you've got your eyes set on a particular property, then you could also check the house prices in the area to see how the seller's price compares.

If you're buying, home valuations can give you a better sense of whether you're getting a good deal or not. If you're selling, home valuations can help you understand whether or not it's worth considering selling your home, or what price to set it at.

Who can give you an accurate house valuation?

Chartered surveyors can give you an accurate house valuation, usually at a cost of around between £250 and £600. This is a service people consider when they calculate the costs involved in buying a home.

Mortgage lenders will also provide their own house valuation, but again, this is something that will be done during the home buying process. Mortgage lenders will give a valuation based on what they think it is worth, and usually costs an additional £100 or so, on top of your mortgage costs.

If you're just speculatively looking for a house valuation, then you can check websites that get their data from the Land Registry and other sources. For example, many estate agents' websites will use data from previous home purchases in the area and the Land Registry, which is a register of home ownership and purchases.

However, the Land Registry doesn't always get updated that quickly. All new data gets added at different times, so what you see in the moment may not always be entirely accurate.

Paying for a property valuation is probably the most accurate way of doing so, but when you're just curious and want to know whether it's worth looking into buying or selling, it's understandable that you don't want to part with your cash for one.

You can still get a fairly accurate valuation for free, but you will need to use a range of sources to give you the best chance of avoiding incorrect and out of date information.

How can you get a valuation for free?

There are a number of free online house valuation tools you can use to assess how much a home is worth, be it your own or one you're interested in buying.

It's worth remembering that free online house valuations are unlikely to be accurate – they should just be used as a guide. If you do your research on several websites, you can reduce some of the margin of error. It wouldn't be worth making any big decisions based off of it.

How do websites gather their data about property prices?

Some websites allow you to simply enter a postcode for a free valuation. They use data from the Land Registry to show you much the home sold for, but can also tell you what it is worth now based on an estimate. These aren't entirely accurate and they usually give you a wide ballpark figure.

Free home valuation websites are a good place to start, but then you should look at several other options to narrow down that valuation figure.

If you want to see how much your home might be worth, there are several online tools to provide a simple guide based on fluctuating house values in each UK region.

Of course, the free home valuations won't factor in any improvements you might have made to your home, and because it simply focuses on a region, rather than a street or even a postcode, it will not give you an accurate assessment.

How accurate will their valuations be?

Some websites will try to forecast house price rises and crashes. It's worth having a look through to see what the risk might be like for home buyers or home sellers.

However, many of these websites have their own agenda (they want a crash to happen or prices to rise, for example) and they are simply interpreting available data and current affairs – it does not mean what they forecast will happen.

What should I look for when doing an online search for house valuations?

If you want a decent sense of home values in a particular area or street, online home listings websites like Zoopla have sections that focus on the purchase history. By seeing what those properties have sold for, you can get a better idea of what they might sell for in future.

You should also see how negative aspects might affect the value of a home you want to buy or sell. Police.uk is the national website for policing in the UK, and will give you crime figures for a particular street or neighbourhood. You can also see what kind of crime is most prevalent.

You can also have a look on the Environment Agency website, to see which areas are at risk from flooding or air pollution.

A combination of all of the above valuation tools can give you an idea, but not enough to hand over the cash or sell your home. It's always best to get a professional home valuation from a surveyor.

Should you remortgage off the basis of a valuation?

Remortgaging could save you money by getting you a cheaper interest rate. And if the value of your home has gone up, you can usually get a cheaper deal.

This is because if the value of your home increases, it might push you into a different loan to value (LTV) bracket.

LTV is the size of your mortgage against the current value of your home. For example, a £150,000 mortgage on a £200,000 home, would equate to a 75% LTV.

As a rule, the lower your LTV, the better the rate you can get. The cheapest rates are available at a 60% LTV, the next cheapest at 65%, moving in 5% increments all the way up to 95%.

So, if the value of your £200,000 home increased to £250,000, assuming you still have a £150,000 mortgage (in reality you would have repaid some of this) your LTV would have decreased to 60%.

But do note if you're making your decisions off the basis of a valuation, you should ensure that your valuation is entirely accurate. You don't want to get caught out by a lender deciding your house is worth less than your valuation put it at.

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Compare mortgages if you're remortgaging, a first-time buyer, looking for a buy-to-let or moving home