House valuation if agreed price between siblings is agreed?

P

Pepsi cola

New Member
Messages
5
My question is,
Do I need to get an inherited house valued by an auctioneer if me and my two siblings have agreed a reasonable price for me to buy them out. We don't want to pay CGT on gains we don't even have.
 
If Revenue question the price you agreed on, will you be able to justify that it is the price which would be obtained in the open market - if so, then no but if not, then you could be open to back taxes, late payment penalties and interest

For the sake of a few hundred euro to get an estate agent's valuation, is it worth it?
 
There is so much work to be done on the house, new windows, new kitchen and heating system, so we thought with all the investment from myself we go for a reasonable price so this could actually be obtained. I'm not sure an auctioneer will see all this as the property is in a nice area.
I'll get the thinking cap on I suppose.
Thank you for your reply.
 
Pepsi cola said:
There is so much work to be done on the house, new windows, new kitchen and heating system, so we thought with all the investment from myself we go for a reasonable price so this could actually be obtained. I'm not sure an auctioneer will see all this as the property is in a nice area.
I'll get the thinking cap on I suppose.
Thank you for your reply.
Click to expand...
So the professional’s view on the valuation might differ from the number you and your siblings plucked out the sky? :)

I’d get a basic valuation done just to see you’re not miles off and to prevent any disputes (notwithstanding the fact you’ve agreed a price).

The price of the valuation should be allowable also I’d have thought.
 
We had the house valued two years ago and agreed a price then off the back of that, it really wasn't plucked out of the sky. But unfortunately two years later, and increased property prices and us still agreeing the original price, I was concerned we would have to pay CGT on something that's not actually a gain.

I will go back to the drawing board.
Many thanks for your reply.
 
Pepsi cola said:
We had the house valued two years ago and agreed a price then off the back of that, it really wasn't plucked out of the sky. But unfortunately two years later, and increased property prices and us still agreeing the original price, I was concerned we would have to pay CGT on something that's not actually a gain.

I will go back to the drawing board.
Many thanks for your reply.
Click to expand...
Don’t “go back to the drawing-board”!

Look at the national house price indexes, any local ones, or similar properties in your area that traded then and now and apply a reasonable uplift.

Or just ask the valuer to update his or her valuation. That should be easy and cheap.
 
I agree with Gordon above.

Contact the same person who did the valuation 2 years ago.

Explain that you need an updated valuation and why. Agree a reasonable but modest increase, if necessary. After all, the cost of the work that needs doing on the house will have increased in the meantime. That in itself may arguably even keep the valuation at its previous level.

At the end of the day you're seeking a valuation from a professional so that you can stand over it in case queries arise. That's all.

Circa €150 + vat should still cover it as after all you'll be getting paid for a quick chat and an amendment to a letter (s)he already has on their system.
 
Gordon Gekko said:
Don’t “go back to the drawing-board”!

Look at the national house price indexes, any local ones, or similar properties in your area that traded then and now and apply a reasonable uplift.

Or just ask the valuer to update his or her valuation. That should be easy and cheap.
Click to expand...
I will speak to them this week. That's great advice and thank you. X
 
T McGibney said:
Are AIB willing to defend their valuations if challenged at a later date by the Revenue Commissioners?
Click to expand...

Bank valuations are done by estate agents. The valuation report contains local price comps on recently sold properties. No estate agent or bank will defend their valuations to revenue. Why would they? They would simply stop doing valuations if they got dragged down that road and the system would collapse. They are just valuations. As long as they show some sense of reality, there won't be an issue.

Who would you go to that would value a house and agree to defend the valuation to revenue if they came asking???
 
Sunny said:
No estate agent or bank will defend their valuations to revenue. Why would they? They would simply stop doing valuations if they got dragged down that road and the system would collapse. They are just valuations. As long as they show some sense of reality, there won't be an issue.
Click to expand...

That's simply not true. I myself have on many occasions commissioned estate agents to perform property valuations in Revenue audit cases, on the explicit basis that the valuations would be used as evidence in the course of the Revenue audits.

I've also known of and dealt directly with situations where estate agents have been subpoenad to appear in court to explain and justify to a judge, valuations they have made.

Any valuation is worthless unless the person preparing it is willing to stand over it.
 
T McGibney said:
Are AIB willing to defend their valuations if challenged at a later date by the Revenue Commissioners?
Click to expand...

The purpose of the bank valuation is to ensure that collateral is associated with a mortgage loan is correctly priced. There are possible downstream implications for a bank's tax bill if the valuations are systematically wrong.

In the highly unlikely event of valuations being challenged individually or en masse by Revenue the bank would point to the assurance it has from using licenced, professional valuers.

I doubt it would be any different in this case.
 
NoRegretsCoyote said:
The purpose of the bank valuation is to ensure that collateral is associated with a mortgage loan is correctly priced. There are possible downstream implications for a bank's tax bill if the valuations are systematically wrong.

In the highly unlikely event of valuations being challenged individually or en masse by Revenue the bank would point to the assurance it has from using licenced, professional valuers.

I doubt it would be any different in this case.
Click to expand...
I think you're missing the point. The purpose of the bank valuation is as you describe. But I'm pretty sure that any such valuation will be prepared on the basis that, and will most likely explicitly state, that it is for the bank's own use and should not be used by anyone else for any other purpose.

I don't understand your point about a bank's tax bills.
 
T McGibney said:
But I'm pretty sure that any such valuation will be prepared on the basis that, and will most likely explicitly state, that it is for the bank's own use and should not be used by anyone else for any other purpose.
Click to expand...
Indeed. But I'm sure that such valuations would have to be shared in the event of a Revenue audit.

T McGibney said:
I don't understand your point about a bank's tax bills.
Click to expand...
It is convoluted and I won't waste space on this thread.
 
NoRegretsCoyote said:
Indeed. But I'm sure that such valuations would have to be shared in the event of a Revenue audit.
Click to expand...

I don't understand your point here. The holder of a valuation can do what they like with it. But if it states that it should not be used for anything other than the bank's internal purposes, it's not worth the paper it's written on.
 
T McGibney said:
The holder of a valuation can do what they like with it. But if it states that it should not be used for anything other than the bank's internal purposes, it's not worth the paper it's written on.
Click to expand...
I paid a valuer from a bank panel once to give me a valuation to avail of a better LTV (2014 I think).

The value was very conservative and I had to push him hard to get a copy myself.

He really didn't want it to be used for any other purpose.
 
You must log in or register to reply here.
Back
Top