Low valuation

monaymadlol

Hi, my parents are going to downsize. 2 estate agents valued the house at  5000 apart. But even this was 25-30,000 below the lowest zoopla estimate (and 100k away from highest estimate).

It does require modernisation - I would say a buyer would put in new flooring, strip wall paper and repaint and probably opt to re-do two bathrooms. 

Though not sure it warrants a downgrade like this? The house is livable in.

I'm advising them currently to get more estimates and ask 'OIEO estimate' as the market is quite quick in this area. 

Is this the best option? 

RelievedSheff

You can ignore the Zoopla estimates they are wildly inaccurate!

monaymadlol

RelievedSheff said:

You can ignore the Zoopla estimates they are wildly inaccurate!

In what way? Too high? Even at lower end? 

Angela_D_3

Zoopla over estimated mine by £20,000 at the bottom end.

Comms69

It's literally like throwing a dart at a wall in the pitch black room. In fact the day a zoopla estimate is correct, i'd start looking for signs of the upcoming Apocalypse. 

monaymadlol

I read they updated their estimate tool this year. They just multiply up based on the last sale price. 

ssparks2003

So 2 estate agents that have actually been around the house and made judgement calls based on its location,  condition and the local market must be wrong and a computer algorithm written in some tech firms office must be right? 

RelievedSheff

They may have updated it but it is still wildly inaccurate.

princeofpounds

Bear in mind the agents usually overvalue slightly (although given coronavirus they may be more cautious in what they promise than usual).

Zoopla isn't great, it's really only a general ballpark. It works best on properties similar to other local properties with lots of transactions (e.g. estates) and also bear in mind that the pricing indexes the algorithm follows are delayed, so it's also less reliable during periods of market volatility. And it takes little account of property condition, of course.

If you really think they are undervaluing, then you can ask them to market at a higher price. They will probably agree if it's not to extreme, for a period, but if time passes with little interest they will push for price cuts (and they would have more evidence). They might also ask for a longer contract or give you less of a discount on pricing, as in their minds the chance of a transaction (and hence a paycheck) is lower.

Crashy_Time

Go with the professional valuation.

davidmcn

monaymadlol said:

I read they updated their estimate tool this year. They just multiply up based on the last sale price. 

Yes - so, their first possibly misplaced assumption is that the last recorded price was a fair arm's-length assessment of the market value of the property at that time. They're then applying the general level of house price indexation for a vast region to that figure. It takes no account of more localised changes in the market, the particular type of property, works which have been done to it, things in the neighbourhood which might detract (or increase) the value, etc.