We have blogged several times in recent months on the subject of estate agents purposely overvaluing properties in order to secure business.
It is endemic and a culture that exists amongst most estate agents.
The reasoning, even in a buyers’ market such as we have, is that ‘any instruction is worth having’. If you have listed a property for sale then you stand a chance of selling it eventually. But if you lose the opportunity to a competitor, you end up with nothing.
High Street agents use sole agency tie ins. Long contracts that prohibit you from changing agents until the expiry of a three or four month long agreement. So, even if the agent has blatantly overvalued your home in order to steal your business, they may well still sell it if you become desperate during that time and reduce the price or accept a lower offer.
Today, a powerful voice in the industry agrees with us that this tactic is prevalent. Nick Mead of The Buying Solution, part of the Knight Frank empire, says ‘There is more stock in the market, although prices are still inflated, mainly as a result of agents vying for instructions.”
Just because a rogue estate agent tells you what you want to hear with regard to likely sale price, it’s not necessarily true. It’s funny how people recognise estate agency as one of the most dishonest professions yet often choose to believe the valuations that they provide?