How much is your customer’s house worth? Ask your customer and will they give you an accurate figure? Chances are, they’re wrong and an inaccurate valuation will slow down the house buying process, with more than 1 in 5 mortgage applications falling at the lender valuation hurdle[1].
The situation is made more complex by the fact that house prices are rising quickly. January 2022 saw the average house price in the UK increase by 9.6%[2] with different regions seeing disproportionate increases. House prices in London grew by just over 2%, whereas the East Midlands saw an increase of 11.6%.
Maybe your client had their home valued over six months ago. A lot can change in that time.
Disparity in valuations
Fluctuations in house prices, disparity of house prices between UK regions, and house defects all have a say in the final valuation of a property.
There is a huge disparity between regions when looking at house prices. In January 2022 the average price of a house in the North East of England was £150,787. In the South East it was £376,558[3].
Indeed, the value of the property is not just down to its geographical location. It can include a whole list of factors including:
- Size
- Condition
- Fixtures and Fittings
- Age
- Layout
- Ease of access
- Garages
- Outbuildings
- The land (and scope for development)
The lender may discover problems with the property when they come to make their valuation with issues such as subsidence, trees, damp, dry and wet rot, flat roofs, and many more influencing the final figure.
With so many variables when it comes to valuing a property, no wonder a fifth of applications fail on valuation.
Hometrack AVM
The good news is there is a way for you to take the guesswork out of valuing a property, making sure you get it right the first time for quick and successful applications.
Hometrack are the leading provider of automated valuation models (AVMs) in the UK. They provide instant and accurate property valuations which have been used by lenders since 2002. In fact, over 80% of the top lenders in the UK now use Hometrack, who perform 50 million valuations each year[4].
This means faster and more efficient mortgage applications so you can give your customers a better mortgage experience.
This means faster and more efficient mortgage applications so you can give your customers a better mortgage experience. Hometrack Broker AVM reduces the mortgage application process by about a week[4] and is designed to give brokers pre-application confidence and reduce declines due to down-valuation or inaccurate property information. The lender will always carry out their own valuation (which could be an AVM, desktop, or physical valuation).
Submit mortgage applications with confidence
Mortgage Brain has partnered with Hometrack to deliver this functionality as part of the Sourcing Brain licence at no extra cost, enabling you to get greater certainty of a property’s value earlier in the sales process. No more relying on the information the customer gives you, now you can get an accurate valuation direct from Hometrack in an instant.
The Hometrack integration within Sourcing Brain brings you added benefits:
- Simpler process, quicker decisions
- Pre-application confidence irrespective of lender
- Property valuation and monthly rental figure
Validating the valuation and your customer’s income at the application stage and before you submit the application to the lender helps you spot potential problems but also means you can expect:
- Less time wasted on failed applications
- An improvement in your closure rates
- More customer confidence in your services
All Sourcing Brain users on the latest cloud-based version benefit from this integration for free. That’s quite something when you think about the time and money it could be saving you by avoiding those rejected applications.
Find out more about Sourcing Brain and our other innovative products for intermediaries.
