Why Over-Valuing Your Property Can Damage Your Sales Price.
Rightmove published research which supported evidence that a property is far more likely to sell for its highest value if buyers are ‘bidding up’..
Why over-valuing your property can damage your sales price.
It may seem a decade ago but the Covid pandemic introduced a new market to Central London, the sales market become quieter and estate agents were scrabbling for work. The effect of this was potentially devastating for property prices with certain agents deliberately over valuing, coming in substantially higher in order to win the instruction.
Regularly, our GLP Sales team are asked to value homes alongside competitors, each offering different terms, services and marketing packages. However, when it comes to a valuation, if an agent is experienced in the area the valuations will come in and around similar prices – these prices are based on actual achieved previously sold prices alongside how the market in the area is performing.
So, why is putting your property on at a higher than market rate potentially detrimental?
Naturally it will mean your property will stay online for longer, this in itself has a negative effect as buyers question – what’s wrong with the property? why hasn’t it sold?. In addition to this, on influential portals such as Rightmove and Zoopla – the longer your property stagnates, the lower down your property sits on their websites meaning naturally less applicants see it. Their platform rewards new properties with the limelight and prizes them with the top position.
At some stage, your agent may suggest a price reduction to bring the property in line with its actual market value. Research shows that buyers who view houses which have had a price reduction will automatically assume the Vendor will take an even lower offer, most the time this is below the market value. All the above is taking place over 2 – 3 months which may hold up the chain you are in and potentially mean your dream home falls through.
Rightmove published research which supported evidence that a property is far more likely to sell for its highest value if buyers are ‘bidding up’. What this means is a weekend of mass viewings, potentially a date for final bids, negotiating and encouraging buyers to offer higher hence creating competition and achieving the maximum price for your home.
Zoopla’s CEO announced figures that backed Rightmove’s evidence that properties that went under offer in less than 3 weeks achieved ABOVE their listed price. In addition to this, they provided figures to show that 60% of properties on the market for more than 60 days were removed and listed with a different agent with at least a 10% price reduction. Over three quarters of these went Under Offer in 4 weeks.
And finally, potentially the most interesting figure, properties that had a price reduction, when finally sold achieved 18% LESS that their original listed price.
Greater London Properties are always here to advise you throughout the Sales Process. If you have chosen to go with a different agent, please do not hesitate to give us a call on 0207 113 1066 if you have any concerns.
You can always find more advice on our website www.glp.co.uk.
We would love to help,
Warm Regards
Kate Hill, Director, GLP