Overvaluation of property can cause problems when remortgaging

Solicitors in Northern Ireland may want to advise their clients to ensure that their properties are properly valued following the publication of new figures showing many homeowners do not know the correct value of their property.

Research from Abbey Mortgages has found that property owners in the UK are over-estimating the value of their homes by more than 35,000 pounds in spite of the price decline.

Homeowners think on average that their investments are worth 190,175 pounds, but this is an over-estimation of 37,280 pounds when put against official Land Registry house price figures, which state the average is 152,895 pounds.

According to Abbey director of mortgages Nici Audhlam-Gardiner, this trend can lead to problems further down the line.

"Homeowners looking to remortgage or sell their homes in the near future need to make sure that the value of their home is accurate and has been valued by professionals," she recommended.

Professional advice website Unbiased.co.uk recently stated that the recession is forcing an increasing number of people into becoming reluctant landlords.

Johnny McCoy, a partner at Wilson Nesbitt solicitors specialising in lender services, said that "accurately assessing the value of your property has always been a difficult task, and is even more so in the current climate when house prices are only just only beginning to show signs of settling".

"It will however save a great deal of time when applying for a new mortgage or looking for a new house if a home owner can be as accurate as possible when estimating the value of their home.

"Enquiring into recent sales of houses in the immediate area can be a good indicator and there are some useful websites that will provide some assistance doing this. In the current market we would suggest that a conservative approach is always taken to estimating value."
Visit our residential property services page