Are EA valuations realistic?

dllive

Hi
We're thinking of selling our house. Doing a bit of research I had it in mind what I think the value of it is. But both estate agents we had over to look at the place valued it at quite a bit more. Is this:
1) I valued it too low
2) They valued it high to get the business
3) They valued it high thinking that - realistically - it will probably sell for 10% less

Im hoping its number 1!

ReadingTim

Probably all of the above, plus (4) you asked too small a number of EAs to be statistically meaningful

AdrianC

Ask them to show you the comparables they've used.

lookstraightahead

Yes. Ask them how they analysed the data. I would suggest they want to win your business but also expect a 10% drop. As I would as a buyer

dunstonh

Are EA valuations realistic?

For a best guess, usually yes.

1) I valued it too low
2) They valued it high to get the business
3) They valued it high thinking that - realistically - it will probably sell for 10% less

A mixture of 2 & 3. And possibly 1.

In my case, I based my price on an identical build house, bar garden space that sold a month before we put ours up. Estate agent said about 25k-£30k more but accept about £5k-£10k less. We put it up at the 25k more figure and got on offer in a week at full price. So, 1, 2 and 3 applied to me.

SmashedAvacado

they want to get property sold - so won't advise you to ask for too much
but they also want to get instructed - and for some reason people tend to instruct the agent with the most aggressive price, not the most impressive agent.

Surrey_EA

Strictly speaking estate agents don't carry out valuations, what an estate agent does is provide a market appraisal.

There is an element of telling the vendor what they want to hear. Any EA who consistently prices at a level they know the property will sell at will likely be out of business pretty quickly as their more 'ambitious' competitors scoop up the majority of the instructions.

ashe

In our scenario in a terrible area up north, we had 5 EA valuations who all put it around the 72-75k price bracket. We eventually sold for 63k. EA we went with wanted to price it at £75k right off the bat and was confident it would sell. Our house was nicer than most in the area and had a garden, but literally 1 street over there were terraced houses with no gardens and in need of full reno but going for only £45k, in mostly rental area its easy to see what investors will go with and upgrade using minimum spec. They will over value to get your business as you are locked in for their minimum term. they can then suggest you reduce from there.

You need to take a multi pronged approach - review what you paid, what you want for the house, and temper this with what the EA suggests. then review house price data in your street for the most recent few years, look at whats on the market in the 0.5m radius around your house and see how long ago they were listed, and look at actual sold price data on Rightmove/Land reg. This will help you arrive at a sensible price - ignore ones that are listed high but been on for 6 months + as they're clearly overpriced or have issues.

It's a vicious circle as Surrey EA alludes to as if someone gives honest pricing, they won't get any business.

SallyDucati

When I sold my flat I was mainly in number 1. I looked at a few other flats in the development that had sold in the last 12 months, took into account the fact the work I thought it needed, the fact that I had extended my lease (not many others had) and came up with a figure of £75 £80k. All 3 estate agents came in with a price within £1k, one of them offers over £100k. I went with the offers over because I got a better feel from the estate agent and I sold for £103k.

dllive

Thanks all - very helpful comments as ever!

kingstreet

Look at the recent (last four months) sold prices of similar property in the vicinity (0.5 miles or less) here as these are the comparables a surveyor will use for your buyer's mortgage;-

https://www.rightmove.co.uk/house-prices.html