Real Estate Alliance

Press Release - Article for the Irish Times, Property Section

By Eddie Barrett, Chairman of Real Estate Alliance

A recent meeting with some colleagues from Real Estate Alliance something sinister came up in conversation. It transpires that I am not alone when I say that I have been asked to compromise myself by ‘valuing up’ properties. When we analysed our experiences that day, we all agreed that the problems we were experiencing were not uncommon, but fortunately not at epidemic stages yet!

This worrying practice stems not from the current topic of the Dublin guide prices issue or advised minimum values (AMVs), but from the valuation processes of building societies, banks and insurance companies who require a property to be valued before they will grant a mortgage to an individual or couple.

These valuation reports are an endorsement that in the valuers opinion the property concerned represents the purchase price/ value, so as to satisfy the lending agency that the percentage loan offered does not exceed or perceive any possible current negative equity.

Many valuation reports pass through my hands every working day together with those of all other valuers and auctioneers around the country. Recently, my colleagues and I have had experiences where a mortgage broker, or in some cases the proposed purchaser, have contacted us directly with instructions to prepare this valuation document. What is worrying is that some have gone so far as to suggest that we might ‘massage upwards’ our opinion of value, so as they may qualify for their maximum mortgage. Put simply, there seems to be an increasing trend to suggest the misleading of lending institutions as to the actual value of a property, so that a purchaser can get a larger mortgage.

This raises serious concerns for the whole mortgage market and begs the question as to how many brokers and potential purchasers encourage this practice. While I would hope that this number is very small it is a scary prospect if you think about the potential impact of ‘valuing up’.

The very fact that the broker or the mortgage client calls or gives the instructions to the valuer, leaves the gates wide open to this possible suggestion of malpractice, in my opinion. Perhaps it would be more prudent if first the lending institutions concerned might sharpen their pencils by examining the appointments of these potentially difficult brokers.

The property industry as a whole has welcomed Minister McDowell’s plans for the new Regulatory Body for the profession, yet there still seems to be a lack of control proposed in relation to the panelling of valuers in property. The lack of appointment of ‘expert valuers’ to the panels of banks, building societies and insurance companies is hugely questionable.

Extraordinarily, engineers, architects and draughtspersons are regularly invited to sit on these panels and carry out valuations/opinions of value, for a number of lending agencies. These people will tell you straight out that they are not professional valuers and how they can feel even a little confident in valuing a property I do not know. What I do know is that I would never attempt to carry out a structural report or for that matter endeavor to design a house or building. These things are best left to those professionally qualified to carry out the task.

I feel that it is high time that all the building societies examine this whole area, so that only properly qualified, professional, indemnity insurance covered valuers, are responsible for preparing valuations.

I also call on the major high street banks to set about immediately appointing valuation panels consisting of only professionally qualified persons with indemnity insurance.

When I recently voiced this to a senior person in a local bank, he told me they did not want to ‘upset’ their client/customer/estate agents by not allowing them to carry out work for them.

These practices are something that needs to be immediately nipped in the bud before it becomes yet another potential can of worms for the property industry.

Eddie Barrett F.I.A.V.I. is currently Chairman of Real Estate Alliance. He is past President 2000/2001 of I.A.V.I. and is Managing Director of North’s Real Estate Alliance in Tralee, Co. Kerry.

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For further details please contact Sharon Plunkett, Plunkett Communications on (01) 678 1460 or email Sharon@plunkettcommunications.com

Note to editors:

Membership of Real Estate Alliance Ltd is only open to firms led by members of the IAVI or S.C.S.

New Members of Real Estate Alliance

McKenna, O’Donoghue Clarke Real Estate Alliance, 19 South Mall, Cork City

Lyons Real Estate Alliance, Charleville, Co.Cork

Grace Real Estate Alliance, Callan, Co. Kilkenny

John Lee & Son Real Estate Alliance, Newport, Co. Tipperary

Orchard Real Estate Alliance, Rathfarnham, Co. Dublin

Board Members of Real Estate Alliance

Eddie Barrett (Chairman) – North’s Real Estate Alliance, Tralee

Aine Myler (Vice Chairperson) – Cumisky Real Estate Alliance, Balbriggan

Michael Gavigan – T&J Gavigan Real Estate Alliance, Navan

Healy Hynes – Hynes Real Estate Alliance, Athlone

Philip Farrell – Brophy Farrell Real Estate Alliance, Newbridge

Harry Sothern – Sothern Real Estate Alliance, Carlow

Sinéad Daly – Eoin Dillon Real Estate Alliance, Nenagh

Michael O’Donoghue – McKenna O’Donoghue Clarke Real Estate Alliance,
Cork City

Barry McDonald – McDonald Bros Real Estate Alliance, Lucan

Gabriel O’Brien – O’Brien Collins Real Estate Alliance, Drogheda

Roger McCarrick - McCarrick & Sons Real Estate Alliance, Sligo

NOTE TO EDITORS Real Estate Alliance is a strategic marketing alliance comprising some of the country�s best-established auctioneers and estate agents.� Real Estate Alliance�s key focus is on locally-owned and established estate agents.� With one quarter of the alliance�s firms in business for more than a century, and with an existing IAVI president & five IAVI past presidents among the group�s members, the alliance is characterised by the established strength of its membership.� In addition, membership is only open to firms led by members of the Irish Auctioneers & Valuers Institute or the Society of Chartered Surveyors.� Clients of Real Estate Alliance members benefit from: Real Advice - Because member firms are locally-rooted and independently owned, they have first-hand market knowledge that ensures clients make only the best-informed real estate decisions. Real Commitment - Member firms are well established, leading local businesses built on delivering the best results for their clients. Real Service - Real Estate Alliance member firms have the detailed understanding of the local property issues facing clients to ensure that they provide a superior range of client services. Real Professionalism - As Ireland's highest-qualified property professionals, Real Estate Alliance sales staff are members of the IAVI or the SCS, the representative bodies for Ireland's top property professionals. Real Confidence - IAVI members complete far more property transactions than any other professional group. Real Estate Alliance member firms harness this transaction volume to seize opportunities and speed the transaction process for you. Real Coverage - With more than 400 professional staff in 40 offices located nationwide, Real Estate Alliance member firms can provide the best real estate advice locally and nationwide.

NOTE TO EDITORS

Real Estate Alliance is a strategic marketing alliance comprising some of the country�s best-established auctioneers and estate agents. Our key focus is on locally-owned and established estate agents. With one quarter of the alliance�s firms in business for more than a century, and with an existing IAVI president & five IAVI past presidents among the group�s members, the alliance is characterised by the established strength of its membership. In addition, membership is only open to firms led by members of the Irish Auctioneers & Valuers Institute or the Society of Chartered Surveyors.

Clients of REA members benefit from:

Real Advice

- Because member firms are locally-rooted and independently owned, they have first-hand market knowledge that ensures clients make only the best-informed real estate decisions.

Real Commitment

- Member firms are well established, leading local businesses built on delivering the best results for their clients.

Real Service

- Our member firms have the detailed understanding of the local property issues facing clients to ensure that they provide a superior range of client services.

Real Professionalism

- As Ireland\'s highest-qualified property professionals, REA sales staff are members of the IAVI or the SCS, the representative bodies for Ireland\'s top property professionals.

Real Confidence

- IAVI members complete far more property transactions than any other professional group. Our member firms harness this transaction volume to seize opportunities and speed the transaction process for you.

Real Coverage

- With more than 400 professional staff in 40 offices located nationwide, our member firms can provide the best real estate advice locally and nationwide.