Valuation of Village Houses - Why are Banks More Conservative?

Solutions and Precautions

In recent years, the transaction volume of village houses has significantly decreased, and banks have become more conservative in their valuations of village houses. For those preparing to purchase a village house, addressing the issue of undervaluation is an important consideration.

In general, village houses are difficult to obtain mortgages from banks due to their status as government leasehold properties, which makes their ownership structure more complex. Additionally, valuing village houses is a challenging task. As a result, banks typically adopt a more conservative approach to assessing the collateral value of village houses in order to mitigate risk.

Under such circumstances, what can potential buyers do to address this issue? Firstly, they can opt for larger-scale village houses with better facilities, which are easier for banks to evaluate. Secondly, if time allows, potential buyers can apply for mortgages from multiple banks, but this may take longer. Thirdly, potential buyers can consider using platforms that offer services from multiple banks and can provide mortgage approval results in as quickly as 9 working days, saving time and effort.

Furthermore, potential buyers can use mortgage calculators to calculate monthly repayments based on their preferred loan term and loan-to-value ratio. However, it should be noted that the results obtained from mortgage calculators are for reference only, and actual calculations should be based on the bank's assessment.

Conclusion:
When purchasing a village house, it is important to be aware of the issue of undervaluation. Potential buyers can prepare by using comparison platforms and mortgage calculators to address the undervaluation issue and save time and effort. Additionally, choosing larger-scale village houses with better facilities can increase the likelihood of mortgage approval. Finally, it is important to note that the results obtained from mortgage calculators are for reference only, and actual calculations should be based on the bank's assessment.

Purchasing a village house requires careful consideration, but with proper preparation and the use of appropriate methods, potential buyers can successfully purchase their ideal home. We hope this article provides useful references and suggestions for potential buyers.