Estate agents valuations are worthless, if you’ll excuse the word association.
Estate agency ‘valuers’ are, in the main, unqualified. Few are members of the Royal Institution of Chartered Surveyors. And as there are no entry requirements to the industry it is often the case that a mortgage broker/call centre worker/car salesman today is a property valuer tomorrow. With no-one any the wiser.
Talk is cheap. It’s easy to spout a figure at someone and walk away without any obligation or recourse. So how does an estate agent value and how should they value?
The big problem with the property industry is that there is no oversight to making sure that values as quoted have to be correct, accurate or based on evidential proof. Even the long arm of the law in the way of the Office of Fair Trading, Trading Standards and the like seem apathetic toward any complaints of inaccuracy. Even when such inaccuracy can be deemed as deception in order to hoodwink a seller into signing up to a long, long sole agency contract on the basis that a particular agent can ‘achieve’ a higher price than his competitors stated.
Because that is what happens. A lot. Indeed many estate agency companies ‘train’ their young valuers to purposely provide an exaggerated figure to potential home owners in order to deceive. That’s one of the main reasons that there are currently over 1 million homes on the market unsold in the UK and stock levels amongst estate agents at their highest ever.
It’s a real problem and one that decent property agents have to content with every day.
The fact is, as logic dictates, that if a property sits unsold for months, there must be a price issue. Like it or not, the market is saying ‘no’. It matters little what a Julian or Nigel tells you he thinks/hopes/believes it is worth.
The market decides.
The agent is merely reflecting value as an opinion. He is not making it so.
When gathering these property professionals in your front room to tell you the news as to what your home is worth, ask them not just what the figure is, but how they have actually arrived at that figure.
Because it’s important to know the process that the agent has used. A finger in the air and a wild guess is simply not acceptable. A quick look at other properties that are languishing for sale up the road and pegging an asking price to the same level, is just stupid. Agreeing with the owner on what they think or hope their property is worth is reckless. And chickening out on imparting the truth in case the home owner doesn’t like the truth, is irresponsible. And cowardly. And unprofessional.
The ONLY way to arrive at an accurate value is to research the immediate market using comparable property sales. Yes, sales. Sold prices on HM Land Registry. Using valuation tools like Hometrack. Checking what has SOLD on the major property portals and, importantly, what has not. Analysing homes that have sold and that people have actually paid money for. Because there is a gargantuan difference between such evidence and the wing and a prayer that some agents rely upon.
You may not like the resulting number but if you really want to sell your property then listen to an estate agent that uses such factual proof of worth in order to provide you with an honest valuation. Do not listen to the Larry with messy hair and a big tie knot that tells you what you want to hear but with nothing to back up his claim whatsoever.
Comparable evidence. Nothing else will do.