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Option Homes Ltd - News- How much is your home REALLY worth…

How much is your home REALLY worth…

Date Added 22/02/2016

Market value, they say, is what someone is prepared to pay for something. But when it comes to getting the very best deal for your home, knowing what to ask does help… which is where it can sometimes go very wrong. By Anthony Stewart.

I conducted a very interesting experiment with the help of a client a few weeks ago, the results of which tell you all you need to know about why so many people are disillusioned with some sections of the estate agency business.
We had been called in to value a lady`s home, a penthouse apartment in a pleasant but not overly expensive part of North London (yes, they do still exist!)

And after we undertook what WE consider to be a proper valuation (researching all the recent sales locally for comparables, even before we went to see it, then spending over an hour measuring, weighing up and generally bending our minds, we arrived at a figure.

The client was pleased as it was at the top end of her expectations, and she then revealed that she had had two previous valuations – each of them wildly different from each other, and from ours.

Partner posing produces interesting results…

So I volunteered to ask in five other local agents to see what they would come up with – and be there for the valuations, posing as her partner. I was totally confident that we did know what we were talking about, but if somebody else impressed her more than we did – so be it.

The five valuations I saw over the next day made me realise just how little trouble some agents do go to when undertaking this most vital part of the process.

The average time they spent on the premises was less than 15 minutes. Several didn`t even measure it up. It was plain that only one had done more than a cursory search through local comparables in arriving at their valuation.

All but one valuation was well under ours, one by more than £100,000, mainly based on the fact that they thought it would sell at a similar price to the apartments in the block – disregarding the fact that it was a penthouse with almost twice as much space.

After absorbing all of that, the client was indeed happy for us to proceed and we achieved a sale at within a few thousand of the asking price after a short bidding contest. Proof, we felt, that we had pitched it just about right.

The exercise also demonstrated how London can be a very tricky place to value at times. Yes, there will only ever be a maximum price for some locations, but there can still be some big differentials between adjoining properties, let alone streets, determined by the type of building, size, outlook, calibre of the kitchen or bathroom, having a parking space and so on.

Areas also go up and down all the time – even a twitch in a local school`s OFSTED report can send parents scuttling to buy… or in the opposite direction.

The simple answer to an accurate valuation

So how do you overcome all these variations and come up with a realistic asking price that won`t undersell the property or lead to it being left on the shelf – itself a really bad sign to send out to buyers?

In a word: research. Time consuming, yes, and sometimes demanding `boots on the ground` rather than just scooting through Zoopla or Rightmove. And if you`re one of three or four agents pitching for an instruction, you might not think that a one-in-four chance is worth breaking into a sweat.

But from a client`s perspective, you should be looking or an agent prepared to go the extra mile, even asking for time to do some extra research before offering a valuation.

And be wary about the agent who breezes in and confidently rattles of a figure even before they`ve measured the place up. Chances are they`re bluffing…
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