A recent report on a property website warning of the dangers of agents overvaluing a home when attempting to secure a sole mandate generated a number of interesting comments.
One seller stated that he was never taken in by the valuation supplied by any agent. The reason for this was that he owned the property and he alone dictated the selling price. He’s not a voice in the wilderness on this and there are many sellers who believe that they know the true value of their home and there is no way that they are going to take the advice of an agent who wants to value the property at a lower price simply to make a quick sale.
The question that has to be asked is how objective can a homeowner be and just because he believes his property is worth a certain amount, are buyers going to agree with him? It’s not a case of knowing the market, as it would be fairly safe to assume that estate agents themselves have trouble coming up with a reasonable price for their own property when it comes time to sell.
Strangely enough, it seems that during boom times agents are accused of inflating prices and during a downturn are blamed for the lower prices achieved. Most agents will tell you that they are not the driving force behind any property market and it is the buyers themselves who influence the prices achieved.
So what about the seller who refuses to lower his asking price on the advice of an agent? One of the most common statements made to defend their actions is: “It took me two years to sell my home, but I eventually got my price.” That’s great, except what the seller forgets is that while he is sitting back waiting patiently to sell his home, house prices are increasing. It’s no surprise that he eventually achieves the full asking price, given the length of time the home has been on the market. By the time a willing buyer is found, the market has adjusted and the once over-priced property becomes a realistically priced property.
Agents do, of course, get it wrong from time to time and there are individuals who will do and say anything in order to secure a sole mandate. But does this mean that the valuations supplied by all agents should be disregarded? Of course not. The best way to separate the rats from the mice is to ask a number of agents to estimate the value of the property.
Obviously, sellers do not have to take an agent’s advice and can market a home for whatever figure they choose. Those who have to sell within a certain period may well not have this luxury and instead of viewing estate agents with suspicion, should carefully consider the reasons why an agent has valued the property at a certain amount. A good agent will not market an overpriced property. This makes perfect sense as there are more than enough realistically priced properties for him to focus on.
Many people are quick to criticise agents and the way they operate. However, interestingly enough, most people not only utilise the services of agents, but will ask their opinion before putting a home on the market. Getting a professional opinion from three or four separate sources and then still choosing to stick to the price that the seller deems fair seems to be slightly insane to say the least. Is it a case of we only listen to what we want to hear or do we distrust agents to such an extent that we simply want to confirm what we think we already know….you just can’t trust an agent?