Surge in Property Down Valuations Wipes Millions from Stagnant UK Housing Market
Property experts are sounding the alarm over a sharp rise in property down valuations across the UK, with some homes seeing more than £1 million wiped off their market value as surveyors take an increasingly cautious approach amid a stagnant housing market.
In some cases, valuations are coming in at less than half of prior estimates. Adam Stiles, Managing Director of London-based mortgage broker Helix Financial Partners, reported that three properties had been down valued by over £1 million in recent weeks.
“In one case, a prime London freehold house estimated at £3 million was valued at just £1.4 million,” Stiles explained. “Another property pair was valued at £1.7 million, only for a second valuer to put them at £2.8 million just weeks later. That’s a £1.1 million difference – it’s simply absurd. We need greater accountability and an impartial appeal process.”
Other mortgage brokers echo the trend. Jack Tutton, Director at SJ Mortgages, noted: “We’ve seen more down valuations this year than in a long time. In one example, a property valued at £250,000 in March was revalued at £225,000 in June – despite no market evidence of a 10% drop in that period.”
Cautious Valuations Amid Stalled Prices
While down valuations can sometimes result from over-optimistic asking prices, many in the industry argue that surveyors are being excessively cautious due to sluggish UK house price growth.
Nationwide’s latest data shows house prices fell by 0.8% in June – the steepest monthly drop in over two years – while Halifax reported no growth in the same month, following a slight decline in May. Property listing site Zoopla reveals there are now 14% more homes for sale compared with last year, with higher supply dampening growth.
London, the Southeast, and the Southwest have seen the largest increases in housing stock – between 16% and 19% more homes on the market – keeping price rises subdued in these higher-value regions.
Signs of a Turnaround – But Risks Remain
July brought a glimmer of hope, with Halifax recording a 0.4% rise – the largest monthly gain since January. Northern Ireland and Scotland are seeing the strongest annual growth, while more affordable English regions such as the Northwest and Yorkshire are outperforming London and the Southeast.
Falling mortgage rates, boosted by the Bank of England’s interest rate cut to 4%, and more flexible lending criteria may encourage buyers back into the market. However, experts warn that a weakening job market, concerns over potential tax rises, and continued affordability pressures could stall recovery.
“The UK property market remains in a fragile state,” Stiles concluded. “Until valuations become more consistent and fairer, sellers, buyers, and lenders will continue to face uncertainty.”
