Widely varying valuations - great opportunity or crazy EA?

1echidna

How did it seem to you would the various EAs be in selling your house? We chose an EA with the highest valuation (although not as out of line as the one you have), but only because he was very easy to talk to and seemed the most knowledgeable about our property and the way he would sell it as well as seeming very professional. We in fact suggested to him that his valuation and suggested asking price may be a little high and would he like to adjust it down but he was adamant that he could achieve it and so it proved in practice and we had a lot of interest and sold very quickly for approx 15% below peak prices and very close to the asking price. Completion is due on Thursday.

chickmug

pie81 wrote: »

that's an interesting thought. are surveyors valuations more reliable than EA valuations?

No they are just as prone to being all over the place but not usually the silly highs.

brit1234

pie81 wrote: »

Not in my area (highbury N5) they're not. All my valuations (and recent sale prices for comparable properties) are way higher than 2003-4 prices. Even the lowest are at 2006 levels.

my highest valuation is way above peak (i.e. mid 2007) level. that's partly why I think it's mad!!

Have you a postcode so wecan check property bee or property snake?

googler

You've answered most, if not all, of your own questions;

You KNOW that nothing similar sold for £500k+ even at peak times.

You KNOW that this is the only valuation you've had that's up there, and so is obviously one to discard. Note, I'm saying discard the valuation, not necessarily the agent - if you think this agent is better than any of the others, you can still put your property to market with them at a lower price than they recommended)

You KNOW that if you do put it on at this high price, it'll sit there and no-one will even look at it, because they'll think it's overpriced too.

I'd say that even "as a punt" you feel that it's a losing bet....

What would I do? I'd suggest put it on the market at a figure somewhere between those quoted by the other four agents - which sounds close to the £460k that you mention - but I'd also pick the best agent. The best agent MIGHT be the one who over-estimated the value, but you talked to them, not me. What else did you discuss with them apart from the value?

chickmug

When I valued I did lots of homework before and took lots of comparables and evidence to show people. Did your agents not do this? If not why not ask the high one to justify the figure and give you evidence?

But either way you need to do your own homework.

I know the three things people look for, in an agent, are: -

1) The highest valuation even though it may sound too good to be true.

2) Reassurance it will sell very very fast.

3) The lowest commission.

BUT points 1 & 2 (especially point 1) are so high on peoples (often greedy) requirements they will believe the high price and get suckered in.

There are many dodgy EA's who deliberately pitch high to get business and when you are signed up will hit you very hard and very quickly with "Prices are not holding you need to bring the price down". Staff get commission for every new instruction & some staff also get commission for every price reduction they persaude seller clients to make within certain time scales.

maggie111

What would worry me putting it on at such a high price is

* Most people only look at new properties coming on the market. Once you have it on at such a high valuation it'll put people right off viewing it at all. If it gets reduced, a lot of people wont see it at the new price.

* Reducing it by 50k-100k after only a few weeks, or even 2 months makes you look like an idiot and people will be less inclined to deal with you.

* Reducing it by 50k will make people think that any offers would have to be close to the reduced price, even if you are willing to accept 20k under £480k. If I was looking for a flat and willing to go up to say £465k at a push I wouldn't view your property knowing the price has been reduced so dramatically already (assuming you reduced it to 485).

I don't know why the estate agents valued it so highly... Perhaps ask them if they have some secret and ask them why it was so much higher than other valuations.

Ultimately, most buyers will be looking for a "bargain", whether they ultimately find one or not. You don't want to scare off potentials.

pie81

1echidna wrote: »

How did it seem to you would the various EAs be in selling your house? We chose an EA with the highest valuation (although not as out of line as the one you have), but only because he was very easy to talk to and seemed the most knowledgeable about our property and the way he would sell it as well as seeming very professional. We in fact suggested to him that his valuation and suggested asking price may be a little high and would he like to adjust it down but he was adamant that he could achieve it and so it proved in practice and we had a lot of interest and sold very quickly for approx 15% below peak prices and very close to the asking price. Completion is due on Thursday.

To be honest all the EAs I got round to value the place seemed pretty decent. There is a glut of agents in my area and the 5 I chose are all well established professional operations (2 local, 3 corporate). I deliberately avoided the newcomers/ known wide boys and only went with those I know have sold lots on my street. The individual agents themselves all seemed like sensible, experienced people who knew their stuff - including the one who valued it way high - but maybe I'm just easily fooled

we asked about fee levels, tie ins, how they would market, presentation recommendations, similar properties sold recently.

pie81

maggie111 wrote: »

What would worry me putting it on at such a high price is

* Most people only look at new properties coming on the market. Once you have it on at such a high valuation it'll put people right off viewing it at all. If it gets reduced, a lot of people wont see it at the new price.

* Reducing it by 50k-100k after only a few weeks, or even 2 months makes you look like an idiot and people will be less inclined to deal with you.

* Reducing it by 50k will make people think that any offers would have to be close to the reduced price, even if you are willing to accept 20k under £480k. If I was looking for a flat and willing to go up to say £465k at a push I wouldn't view your property knowing the price has been reduced so dramatically already (assuming you reduced it to 485).

I don't know why the estate agents valued it so highly... Perhaps ask them if they have some secret and ask them why it was so much higher than other valuations.

Ultimately, most buyers will be looking for a "bargain", whether they ultimately find one or not. You don't want to scare off potentials.

Thanks, this is interesting. I hadn't realised buyers would be so quick to write properties off... but I think you may be right.

I think we'll go back to the crazy-price EA and ask them for more back up for their valuation - similar recently sold flats, list of current buyers looking in that price range for 2 bed flats, that sort of thing. (Any other suggestions for what we can ask for very welcome).

If we're still not convinced - and I doubt we will be - then we'll go with whoever will offer us the lowest fee (as they all seem similar re quality) and put it on for the median valuation, which also seems sensible to me given what else is on the market - £485k or thereabouts.

Thanks everyone for your help. It is SO tempting to try for the higher price but it does seem too good to be true.

Emmzi

pie81 wrote: »

that's an interesting thought. are surveyors valuations more reliable than EA valuations? I had thought they mainly just went with what the mortgage co wanted them to say ... ??

heh, partly. *but* they don't have the same agenda as an EA, cos you have already chosen and paid them. I'd say *more* reliable if you are really conflicted.

Cissi

Ouch, yes do be sensible, please - I wish we hadn't fallen for a similar line when we put our last house on the market in early 2004! Our valuations all came in just below £500k, except for one agent who valued it at £599. We also weren't "in a hurry" to sell so thought it was worth a shot, went with that agent and an asking price of £575k. We did accept one offer at £535k but that fell through and then nothing. We had a baby and took the house of the market for a while, then the mini-slump of 2005 happened. We eventually sold in late 2005 for around £490k - probably what it was worth all along, but we could have saved ourselves a lot of stress and wasted time by going for a realistic price to start with!