Estate agent valuations

Captain_Salt

Hello,

We put our house on the market a number of months ago. It was originally valued by a local estate agent at £75k who were confident that it would sell within a month.

After over 2 months with only one viewing, we decided to look at part exchange as an option. The house builder took our original valuation, advised they would get in touch with the agent, and arrange for a second agent to appraise.

To our surprise, our original agent came in lower than the second agent. They quoted a market price £10k below their original appraisal, with a fast sale price of £20k lower. The second agent came in at £70k, £65k and £60k (fair imho).

Obviously we were not happy with our agent, and asked the managing director why they had misled us about the price. We were met with a wall of corporate speak. He was very irate when he discovered that the builder had disclosed his valuation to us (even they said they were surprised at the difference between their original estimation).

Just wondering if anybody has been in a similar situation and if there is anything to do regarding the estate agent. Unfortunately their £55k valuation has resulted in an extremely low part ex offer, and we still have to pay their selling fees as they have sole selling rights.

dunstonh

To our surprise, our original agent came in lower than the second agent. They quoted a market price £10k below their original appraisal, with a fast sale price of £20k lower. The second agent came in at £70k, £65k and £60k (fair imho).

Part exchange uses a different pricing criteria. Builders insist on pricing for virtually immediate sale. So, you get around 10-15% less than you would be recommended to retail it at. Remembering that in reality, your £75k would probably have ended up at 70k after offers.

Just wondering if anybody has been in a similar situation and if there is anything to do regarding the estate agent.

The agent has done nothing wrong.

csgohan4

One would be naïve to think that the what the EA says is absolute, they wanted your business by quoting a higher valuation and promising a sale that was quick.


Reality is your house if overpriced, EA valuations are just that, where as a RICS valuation is more realistic than the EA's

Davesnave

Many agents will talk up the price of a house to get a vendor's business. As it's an inexact science, what yours has done is not illegal.

You can protect yourself to a large extent by doing your homework on local sold prices, and by gettting a number of valuations. I last had five. Apparently, you chose not to do this.

What sort of contract you agree to is up to you too. Everything is negotiable.

Sorry, I can't see there is anything you can "do" regarding the agent and the situation you're in, except learn from it.

Captain_Salt

Part exchange uses a different pricing criteria. Builders insist on pricing for virtually immediate sale. So, you get around 10-15% less than you would be recommended to retail it at. Remembering that in reality, your £75k would probably have ended up at 70k after offers.

I thought that this is why they have the 3 valuation scales. Market price, reduced price, fast sale price. I could understand if the fast sale price was £10k lower at £65k. However, they told us that the market price was £75k, and the builder was told that the market price was £65k. The fast sale price was £55k.

Captain_Salt

One would be naïve to think that the what the EA says is absolute, they wanted your business by quoting a higher valuation and promising a sale that was quick.


Just to clarify, we were not expecting £75k for the house. We were fully aware that any offers would be lower than this, and that was a guide price only.

The only issue I have is that the EA's gave the housebuilders a different market valuation to what they gave us.

dawyldthing

They’ll prob give the house builders a low price valuation to possibly bring the price down, esp if the house builders sell through them too. Estate agents are there to get a sale. There not bothered if it sells for £75k or 75p as long as they get their fees.

A friend of mines bought a new build and has been trying for the last year to sell their house privately. I still don’t think it’s sold, but I don’t think they can lower it much more as they need the money towards the new house. So it’s just stuck on the market.

Mine was on for £73k at first, then a few months later for £70k, I Put several offers in and got it for over 10% less than the price. Valuation knocked a couple of grand off too. Estate agents put the price they think the vendor wants. It doesn’t mean it’s anywhere close to what you’ll get.

Like I say they want houses on the books so will tell you what you want to hear.

Chalk it to experience, go on right move and bring up all the sold prices in the immediate area and see what they’ve sold for then possibly ring the estate agent and tell them you want it lowered to x from your own research. As if you do sell it to the builders they will want it for less as they want to make profit too.

It’s winter though so the market does slow down. I bought mine in winter. I think if it had been in summer it might have been more, but I’m not bothered.

G_M

So initially you did the sensible thing and got 3 agents round to give valuations, and in each case you asked them how much they would recommend you market for, and how much you could expect to sell for, yes?


You then took those 6 figures, and compared them against recent 'sold' prices forsimilar local properties, yes?


Then you instructd your chosen agent what figure tomarket the property for?


It seems from what you say that you over-priced it despite doing all the above.

SmashedAvacado

here's an idea, If you think the property could be sold quickly for more, why don't you put it on the market at your idea of a quick sale price and see what happens?

Captain_Salt

G_M wrote: »

So initially you did the sensible thing and got 3 agents round to give valuations, and in each case you asked them how much they would recommend you market for, and how much you could expect to sell for, yes?


You then took those 6 figures, and compared them against recent 'sold' prices forsimilar local properties, yes?


Then you instructd your chosen agent what figure tomarket the property for?


It seems from what you say that you over-priced it despite doing all the above.

No... I think you have misread my post.

The EA were confident that we could get £75k. At their recommendation we listed it at this price. Obviously they are not confident because they have given a different figure to the housebuilder.

Just to make this absolutely crystal clear:

We were told that the market value of our property was estimated at £75k.

The same EA then estimated the market value (NOT THE FAST SALE PRICE) at £65k to the housebuilder.

They reduced their market value by £10K for the housebuilder. The fast sale price was £20K lower at £55k.

Captain_Salt

SmashedAvacado wrote: »

here's an idea, If you think the property could be sold quickly for more, why don't you put it on the market at your idea of a quick sale price and see what happens?

I'm not sure how this is relevant to my post in any way.