Value of flats

Tabieth

I’m certain there are some dodgy Estate Agents. It would be naive to think otherwise. But I highly doubt that all your local EAs are dodgy. 

Shop around. List your flat with several local EAs (so they’re in competition with each other). And don’t accept an offer you think is too low. That way if some are dodgy, you minimise any impact. 

You’re the seller. It won’t all go your way and you aren’t entirely in control of the process. But nor are you the victim of a shady conspiracy. 

Albermarle

kiwi07 said:

daveyjp said:

kiwi07 said:

Edi81 said:

Depends on where in the country it is. 

The price is only what a buyer is willing to pay - so many variables….

So the agents are working for buyers but not for sellers? If they set the price they want, so do they really work for the seller? In America it's for how much the seller want to sell the property for but here the estate agent set the price they want? 

No they work for the seller.  However they can ask whatever they want, in reality its the lender which generally decides the value.

Also remember a property can be valued for income or for living in.

A holiday cottage may be £2,000 a week to rent to holidaymakers, to rent to a permanent resident could be £2,000 a month.  What is the value of the property?

As regards flats.  Some could be ten times what they sold for 15 years ago, some could be half the price.  All down to local supply and demand and occupational costs.

In our area flats are snapped up really quickly by renters and the price of rent has doubled. So market dictates to sell the flats for low at the same time increasing the rent for the tenants. 

The rental market has its own dynamics. In the last three years ( or more) there has been a shortage of available rental property. In some areas a year ago there were long queues to view any new rented property that came on the market. So inevitably rents went up a lot.
However new legislation and tax has made it more difficult for many landlords and although rents have gone up a lot, profit margins have not done the same.
In fact it seems many smaller landlords are selling up due to it being too much hassle for not enough reward.
So it is not as simple as you make it sound.

Albermarle

kiwi07 said:

Tabieth said:

kiwi07 said:

What they can do in an unethical practice- not to bring the viewers in at all so they can then say - see your property isn't popular, we have to lower the price. There is only one person who is interested  (their investor). 

If you’re that untrusting then sell via auction. Or go with several estate agents for a bit of friendly competition. 

It could be that all your local EA are unethical but that’s a little bit unlikely. My understanding is that flats don’t increase in value the way that houses do in many areas. I don’t know where you are selling or what your local market is like. But I really wouldn’t be seeing conspiracies here, there are far simpler explanations to slow sales. 

So you don't believe there are dodgy EAs with not ethical practice?

Of course there are some. Also many buyers and sellers do not always act very nice either.

kiwi07

No, I am talking about experience, it's far away from conspiracy theory. 

I think more likely  to find dodgy estate agents are among independent ones compare to national which are more regulated? As independent are their own bosses so not much under regulation? 

Tabieth

kiwi07 said:

No, I am talking about experience, it's far away from conspiracy theory. 

I think more likely  to find dodgy estate agents are among independent ones compare to national which are more regulated? As independent are their own bosses so not much under regulation? 

If that’s what you think then market your flat with several national chains then. Problem solved. 

eddddy

kiwi07 said:

So the agents are working for buyers but not for sellers? If they set the price they want, so do they really work for the seller? In America it's for how much the seller want to sell the property for but here the estate agent set the price they want? 

In simple terms, in the UK, it works like this:

A sensible seller would invite 3 or 4 estate agents to do a market appraisal. The results might be...

• Agent 1 says "I believe I can achieve a selling price of £300k for your flat"

• Agent 2 says "I believe I can achieve a selling price of £325k for your flat"

• Agent 3 says "I believe I can achieve a selling price of £280k for your flat"

The seller interviews the agents, and decides which one they believe, and which one they want to hire.

(Some agents will quote an unrealistically high price, in order to get hired. And then put pressure on the seller to reduce the asking price.)
 

The seller is free to say

• "I want the asking price set at £360k"
• or "I want the asking price set at £250k"
• or whatever

But an agent might refuse the job if the buyer insists on an asking price of £360k - on the basis that it won't sell for that, so it's a waste of their time.


But I've also heard stories of vulnerable, unsophisticated sellers inviting just one agent to do an appraisal, and essentially the dodgy agent 'grooms' the seller into agreeing to a stupidly low asking price.

(There are house buying companies that seem to work like that.)

eddddy

kiwi07 said:

No, I am talking about experience, it's far away from conspiracy theory. 

I think more likely  to find dodgy estate agents are among independent ones compare to national which are more regulated? As independent are their own bosses so not much under regulation? 

All estate agents are heavily regulated. But there is almost no policing.

(And I suspect that a number of estate agents break the law to a lesser or greater extent)

The only way an estate agent gets caught is if a seller or buyer spots their wrong-doing and reports them to the authorities.


FWIW. here is some of the legislation that regulates estate agents

• Estate Agents Act 1979,
• the Consumers, Estate Agents and Redress Act 2007,
• the General Data Protection Regulation,
• Competition Act 1998,
• the Consumer Protection from Unfair Trading Regulations 2008 (CPRs),
• Business Protection from Misleading Marketing Regulations 2008 (BPRs),
• Consumer Contracts (Information, Cancellation and Additional Charges) Regulations 2013,
• Consumer Rights Act 2015

Plus, at the extreme end of the scale, if an estate agent lies to a seller in order to persuade them to sell their property cheaply to a friend - that would be fraud, which is a criminal offence.

But again somebody (e.g. the seller) would need to spot the fraud and report it to the police. And realistically, it might be very difficult to persuade the police to take an interest.

horsewithnoname

kiwi07 said:

Veteransaver said:

kiwi07 said:

daveyjp said:

kiwi07 said:

Edi81 said:

Depends on where in the country it is. 

The price is only what a buyer is willing to pay - so many variables….

So the agents are working for buyers but not for sellers? If they set the price they want, so do they really work for the seller? In America it's for how much the seller want to sell the property for but here the estate agent set the price they want? 

No they work for the seller.  However they can ask whatever they want, in reality its the lender which generally decides the value.

Also remember a property can be valued for income or for living in.

A holiday cottage may be £2,000 a week to rent to holidaymakers, to rent to a permanent resident could be £2,000 a month.  What is the value of the property?

As regards flats.  Some could be ten times what they sold for 15 years ago, some could be half the price.  All down to local supply and demand and occupational costs.

In our area flats are snapped up really quickly by renters and the price of rent has doubled. So market dictates to sell the flats for low at the same time increasing the rent for the tenants. 

So rent it out then.
Or ignore the agents and put it on the market at the price you think it's worth and see if you get any offers.

I can't rent it out, I want to sell it. The problem with EA they all pretend like they are working for you but in reality they have their preferred investors. So once the flat is on the market, they call them saying something like there is a flat which I can arrange it to sell cheaply to you. I am concerned they all work this dodgy way. 

I think you might want to invest in a tin foil hat.  Or just put your flat in an auction, then you’ll get whatever someone is prepared to pay on the day. 

kiwi07

eddddy said:

kiwi07 said:

So the agents are working for buyers but not for sellers? If they set the price they want, so do they really work for the seller? In America it's for how much the seller want to sell the property for but here the estate agent set the price they want? 

In simple terms, in the UK, it works like this:

A sensible seller would invite 3 or 4 estate agents to do a market appraisal. The results might be...

• Agent 1 says "I believe I can achieve a selling price of £300k for your flat"

• Agent 2 says "I believe I can achieve a selling price of £325k for your flat"

• Agent 3 says "I believe I can achieve a selling price of £280k for your flat"

The seller interviews the agents, and decides which one they believe, and which one they want to hire.

(Some agents will quote an unrealistically high price, in order to get hired. And then put pressure on the seller to reduce the asking price.)
 

The seller is free to say

• "I want the asking price set at £360k"
• or "I want the asking price set at £250k"
• or whatever

But an agent might refuse the job if the buyer insists on an asking price of £360k - on the basis that it won't sell for that, so it's a waste of their time.


But I've also heard stories of vulnerable, unsophisticated sellers inviting just one agent to do an appraisal, and essentially the dodgy agent 'grooms' the seller into agreeing to a stupidly low asking price.

(There are house buying companies that seem to work like that.)

It's on every EA interest to value at the lowest end so it's gets sold quickly. 

Caz3121

are their fees not a % of the selling price? It would then be in there interest to sell at the highest price as they will make more money.
However if similar properties are selling for less then you could be sat for sale for a long time. A few threads or properties sat for sale for a long period and having to reduce price.
Maybe the Scottish system is better where the seller has a Home Report and valuation done that is available to potential buyers. No separate lenders valuation required so buyer can choose to offer under or over valuation and the seller can choose whether to accept or decline.