Automated Valuations -Gamechanger?
A new insured valuation model has entered the market to combat the lack of physical valuations. Will it be here to stay?
The process cross-references three independent values, which must match within an agreed tolerance, based on any individual bank’s lending rules: the market value agreed between buyer and seller; a Virtual Survey Model which takes into account local, micro-market conditions; and an Estimated Valuation Model.
The insurer analysed the valuations predicted by the model against actual property transactions reported via Land Registry data. The conclusion was that it delivered an accuracy rate of 99.2%.
This level of accuracy allows insurance to cover any shortfall between the mortgage lent based on the valuation and monies recovered in the event of repossession.
No model at the moment can cope with HMOs, Multi-Units and Refurbishments. So will valuers for most single lets be needed in the future?