If an estate agent overvalues your property and you put it on the market for that price, it could be the worst thing you do.
When you’re trying to sell your home, it’s hard to know what price it should go for.
You might get several valuations from estate agents all trying to get your business.
One suggests it can sell your house for a bit more than the others, and you’re delighted – you’re going to end up with much more money than you thought you would, right?
Well, our research suggests that if you go with a higher valuation that’s been overinflated, your property could end up selling for much less and it may take you a lot longer to move.
List for more, get less
Take the experience of one member who put their property on the market in 2011.
The estate agents’ valuations on their home were spread between £480,000 and £650,000, and they naturally settled for the top one.
Despite querying the price with the agent, they were assured that it was an appropriate starting point.
However, it took a staggering four years for the property to sell and when it did, it went for £482,000.
In that time, they changed agents twice, and the price of the property was reduced several times.
The long game
This isn’t uncommon. Our research suggests that nearly one in five properties sold in England and Wales last year had to be reduced by 5% or more in order to sell.
We also found that heavily reduced properties took, on average, up to two months longer to sell than all other properties.
What’s more, while these properties went on the market for £6,000 more than others, on average, they ended up selling for £20,000 less.
Some members we spoke to even missed out on their dream homes because the property they were selling had been overvalued.
Getting the price right
We think it’s your estate agent’s job to get the best price for your property. However, there are several steps you can take to stop being caught out by an overinflated listed price.
Firstly, make sure you get at least three valuations on your home. Then check those against what similar houses in your area have recently sold for.
You can do this by looking at properties that have been ’Sold Subject to Contract‘, or search sites such as Zoopla or Rightmove. These use Land Registry data to show you what houses in your area actually sold for.
Then, once you’ve found an agent, avoid accepting sole-agency agreements with tie-in periods of many months. There’s no reason why an agent should need six months to sell your house.
Have you struggled to sell your house because it was overvalued? Did you lose out because of it?