November 28, 2015
An estate agent incorrectly valuing your home can be extremely costly. So why would an estate agent get this important process wrong? Below are the 3 main reasons
Imagine you get a number of agents to value your property. Agent A values the property at £190,000. Agent B values the property at £200,000. The final agent- Agent C asks what price the previous agents have valued the property. They then value the property at £220,000 knowing that the true value is £190,000.
So why would an estate agent do this? This is called ‘BUYING YOUR BUSINESS’.
The agent will then lock you in to a LONG TERM SOLE AGENCY AGREEMENT (usually for 6 months). After a few weeks of not receiving any interest in your overpriced property, the agent will call to ask you to drop the price to a more realistic level. If you are not happy with this, you cannot change estate agents until you come to the end of your 6 month sole agency agreement. As the agent knows this, they will keep pestering you to reduce the price hoping that it will get to a low enough level to attract interest and maybe to achieve a sale.
If the vendor’s expectations on price are unrealistic or too ambitious, it can be uncomfortable for estate agents to give bad news to people looking to sell their properties.
Some agents would rather avoid such potential conflict with homeowners by telling them ‘What they want to hear’ opposed to ‘What they should be hearing’. The agent will then lock the customer into a LONG TERM SOLE AGENCY AGREEMENT (usually for 6 months), and then chip away at the price hoping it will get to a low enough price to attract interest and maybe achieve a sale.
The first 2 examples of estate agents over valuing properties are down to them knowing the truth but not telling the information to the potential seller. The third example is failure to understand how the market is, and how it is performing at the precise moment you want to sell your property.
Quite simply, the longer a property is on the market, you more likely you will lose money.
Put yourself in the buyer’s position for a moment. Imagine you have seen a property that has been on the market for over 6 months. Even if the price has been reduced on previous occasions, a buyer may decide that there is something wrong with the property.
Also, the most common question asked by buyers at a viewing appointment is ‘How long has it been on the market for?’ Why do you think buyers ask that question? The simple truth is that the longer a property is on the market, the lower the offer will be from the buyer (even if the property is 100% right for them).
Our motto is ‘Transparent & Trusted’
This means that when we value a property, all valuations are backed up with detailed comparable evidence proving the correct valuation of your home. We are trusted by our clients as they can see we have nothing to hide.
Quite simply, if your property is priced correctly, you will sell quicker for a better sale price, and with a lot less stress.
Merrick Binch estate agents are statistically the most EFFECTIVE Estate Agent in Coventry. For your free valuation, call the sales team on 02476 578888, or click on the online booking button.