The news seems to have been full of stories of property being overvalued in recent months.
Most recently, research carried out by online estate agent eMoov has suggested that some estate agents are intentionally overvaluing property in order to entice sellers and win instructions.
This overvaluation is leading to disappointment for house sellers who are led to believe their house is worth the overinflated figure and then encouraged to reduce the asking price significantly to secure a sale. In fact, eMoov are suggesting that property sellers in the UK are asking around £74,000 more than the price they eventually sell the property for.
Overvalued properties is something we hear of all the time
Julia Gee, Property Purchase Consultant at Quick Move Now, says overvaluation by estate agents is something she hears about regularly:
It can be quite difficult for home owners to gauge what their property is really worth. Estate agents valuations can vary massively, and it’s human nature for us to hope our property will achieve the highest figure mentioned, but often this just isn’t realistic.
There’s a great deal of confusion about the difference between asking prices and market value. Even if an estate agent is not intentionally trying to mislead you with an overinflated valuation to secure your business, they will very often recommend putting a property on the market for more than they believe it is really worth in order to ‘test the market’. If you’re led to believe your property is really worth this overinflated figure, it can leave you feeling disappointed when you don’t achieve that price. You can be left feeling that you’ve missed out on money that was never really going to be achievable.
As a starting point I advise clients to carry out some internet research. Websites such as Rightmove and Zoopla can show you recent sold prices in your area and also show you the sort of property your home would be competing against, which will help you be realistic about the figure your property might achieve.
Managing our clients’ expectations is always challenging, but we are completely transparent about how we assess a property’s value, and we run through all of our research with our customers so they understand the rationale behind the figure we offer and can trust that we are giving a realistic valuation.
Interestingly, the research carried out by eMoov, which included a survey of over 2,000 sellers in England and Wales, found that only 30% of sellers considered getting the highest asking price to be the most important factor when selling their home. Securing a buyer in a stable financial position and not missing out on securing a new home were also deemed important elements with 25% and 14% respectively.
Julia says this is backed up by feedback from her customers:
People sometimes assume that our customers come to us because they are in financial difficulty, but that’s just not the case. Most of our customers are attracted to the speed and security we can offer them, as a genuine cash buyer. Time and time again our clients tell us they have come to us because of the peace of mind a guaranteed cash purchase offers them, and the freedom it gives them to move on to their next home.