Home owners are in danger of overestimating properties by average of £35,000

carolt

Sound familiar?

http://www.telegraph.co.uk/property/propertynews/5352006/Home-owners-are-in-danger-of-overestimating-properties-by-avearage-of-35000.html

A survey of more than 2,000 home owners found that they estimated the value of their homes, on average, to be £190,175. This is an overestimate of £37,280 compared to figures published by the Land Registry, which shows the actual prices of a home when it is sold rather than the asking price.

Asking prices are often higher as home sellers seek to maximise the amount of money buyers will pay for a property.

The findings, exclusively revealed to The Daily Telegraph, showed the difference between perceived prices and the reality is widest in the East and South East of Britain, where home owners estimate the average value of their home to be £226,759 compared to an average actual sale price of £173,337.

The average price of a home, according to Halifax, Britain's biggest mortgage lender, has dropped 17.7 per cent in the past year to almost £155,000.

Nici Audhlam-Gardiner, Abbey Director of Mortgages, said: "Home owners 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 to avoid problems or disappointment further down the line."

mr.broderick

carolt wrote: »

Sound familiar?

http://www.telegraph.co.uk/property/propertynews/5352006/Home-owners-are-in-danger-of-overestimating-properties-by-avearage-of-35000.html

A survey of more than 2,000 home owners found that they estimated the value of their homes, on average, to be £190,175. This is an overestimate of £37,280 compared to figures published by the Land Registry, which shows the actual prices of a home when it is sold rather than the asking price.

Asking prices are often higher as home sellers seek to maximise the amount of money buyers will pay for a property.

The findings, exclusively revealed to The Daily Telegraph, showed the difference between perceived prices and the reality is widest in the East and South East of Britain, where home owners estimate the average value of their home to be £226,759 compared to an average actual sale price of £173,337.

The average price of a home, according to Halifax, Britain's biggest mortgage lender, has dropped 17.7 per cent in the past year to almost £155,000.

Nici Audhlam-Gardiner, Abbey Director of Mortgages, said: "Home owners 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 to avoid problems or disappointment further down the line."

Working late tonight carol.

carolt

Likewise, I see.

Thrugelmir

Unless they had the 2,000 properties surveyed , how did the Telegraph know what they were worth?

The overstatement is so large as to be unbelievable.

lostinrates

My parents, IMO, overestimate the worth of their house considerably. They have added value to it since arrive, in the form of adding a reception rooms as down stairs extentions, and a bathroom, and property rose after they bought it, IMO, it is not the ''worth'' they think it is, by about 20%. Which they would find hard: but I think if an agent valued it as such they'd drop their imagined asking price. hey have done this in the past.

1984ReturnsForReal_2

Are the Barclays after some cheap property?

Pobby

Thought this quite interesting.
http://news.bbc.co.uk/1/shared/spl/hi/in_depth/uk_house_prices/html/houses.stm

Gorgeous_George

Prices could fall by a further 25% and still houses wouldn't be cheap. They have always been the most expensive thing that most people buy.

I guess what we should be looking at is 'value'. A buyer/lender may value a house at, for example, £200K but the owner may choose not to sell for less than £250K. As they cannot agree a price, there is no sale - unless one or other of the parties can be persuaded to change their position.

It's not a problem of course. The seller would rather keep the property than sell at a price lower than his valuation and the buyer will look elsewhere. In time, either the buyer (or another buyer) and/or the seller may move their bargaining points and agreement could be reached.

So, in brief, if the house you would like to buy cannot be bought for the price that you are prepared to pay, move on to another house. You may finds a less desirable house within your budget or a seller with a lower botttom-line.



GG

Mini_Bear

I know so many people in the south east who think their houses are worth more than they are and are gettin a shock when they remortgage.
I think so many people for so long saw a massive wealth increase due to their property increasing in value that they struggle to realise they have lost it.

Pobby

Mini_Bear wrote: »

I know so many people in the south east who think their houses are worth more than they are and are gettin a shock when they remortgage.
I think so many people for so long saw a massive wealth increase due to their property increasing in value that they struggle to realise they have lost it.

Mad isn`t it! We bought at the bottom and made a stupid offer. Vendor just wanted out. So by 2007 we saw an increase of 400% in the price. That`s dropping and so what. It wasn`t really wealth at all.

Dithering_Dad

lostinrates wrote: »

My parents, IMO, overestimate the worth of their house considerably. They have added value to it since arrive, in the form of adding a reception rooms as down stairs extentions, and a bathroom, and property rose after they bought it, IMO, it is not the ''worth'' they think it is, by about 20%. Which they would find hard: but I think if an agent valued it as such they'd drop their imagined asking price. hey have done this in the past.

Are they thinking of moving?

TBH, I have no real idea what our house is worth. The one next door went for £300k but that was a distressed sale due to the couple who owned it splitting up (4 months after getting married and spending £20k on the wedding! :eek:). I only found that out because the new neighbours told my missus about it over the garden fence.

I think if you asked anyone in the street what their house was worth, they probably wouldn't have a clue and would overestimate. It's no difference with estimating the value of houses, cars or any other expensive item - unless it's your job to know, you have no real idea.

I'm sure that if we did think of selling up, the estate agent would quickly put us right about the house's value and then we'd have to make the decision on whether it was worth selling at that price or whether to stay put.