Price range of houses - what I learned from onr agent today

[happyAvocado]

We asked one agent whilst viewing a house about a price range.

Where a price range is given, the higher price is the figure that the seller thinks their house is worth, the lower price is below which offer will not even be not considered (will be automatically refused).

My thought now is - I would not even look at a house where I can't match near a higher end of price bracket. So it is worth talking to agents ;)

The only person who decides is teh buyer. If something was on at a range why would you pay near the top end?

Depends how long a property has been on the market though - start nearer the lower end first and creep up to what you can afford. I always ignore the higher end, it can be wishful thinking in this climate.

a house I saw and put an offer of 300 where was having price range 300-340K, they obviously accepted 330 offered by another buyer, but I guess they would not have accepted mine anyway as in light of what agent said - buyer though his house was worth 340.

They would if it was the only offer and they wanted to move!

one would hope so ;)

I know of a house marketed at £1.1m in a supposedly "prime central london" postcode. It sold after two years on the market for £790k.

The owner had previously rejected my friend's offer of £830k, made in the first week it was on the market and based on actual completed local sales, because it was "insulting".

Amazing, really. I don't who I feel more sorry for, the deluded vendor or my friend who missed out on a house she really loved.

Thomas :(

HappyAvocado - that's not strictly true and you may miss out on a fab house if you put too much weight into that comment.

Estate agents over-value in order to get the instruction. The vendor mentally spends that money.

It then becomes very hard for them to accept that the EA's valuation was probably more of a guess.

What amazes me is that agents and vendors apparently can't use the internet and find out what prices other houses in their street have sold for recently.

One house near us put on the market over year ago for 20% more than the house next door (which is the other half of the semi) that sold a few month previously. It was in just the same condition, identical in every way.

Honestly, its so easy to look up sold prices now. I don't see where the guess work is. Not surprisingly, the house that was 20% over valued has taken more than a year to sell and has just sold pretty much what the house next door sold for 18 months ago.

Some vendors also look at the sold prices of their neighbours houses and assume that theirs are worth the same, even if the neighbour's had a new kitchen and bathroom whilethey haven't updated since the 1950's and have piss-smelling carpet in the bathroom (bitter experience of recent refused offer)

I learnt the hard way that vendors are a bit deluded when it comes to asking prices...

Last year when we were looking at houses we had 4 offers refused all within £5k of asking price. We were no chain, mortage sorted and could move quickly.

2 of those properties have since been taken off the market by the vendor and the other 2 have sold but the sale has fallen through.

I agree and the proof is in the pudding - properly priced properties sell in a matter of days. Well to be honest accepted higher offer doesn't obviously mean sale price until money's transferred.

But learning that piece of info suddenly made me to understand how both sellers and agents are trying to play on the minds of buyers, lower bottom price brings people through the door with a hope that they will find extra 5-8% to make in near the top end of the price range...

Sorry- I would only ever look at the lower end of the range.
People are seriously deluded about what their properties are worth.

We once put an offer in on a house that was turned down. Five months later the agent contacted us to ask if we'd like to offer again. It turned out the vendors had not only turned down our offer but several others that were higher but now were panicking as winter was looming, house was standing empty, etc. DH explained we had learned more about period properties while househunting and now realised it would cost more to renovate than we previously thought so we offered 10k less, they pushed us up 3k so we saved 7!

Sometimes vendors are irrationally greedy and shoot themselves in the foot.

I don't really understand why you would offer your property at a "range" price. Surely you say... "Here is my house, I want £x for it". That is then a 'guide' for the people who might want to buy it, who then make their own judgement of what is a realistic and sensible price they they are prepared to pay. Some people then negotiate between the two prices, some vendors say 'no', and the people making the offer decide if they want to up the offer or walk away.
If something were advertised as being 'between this price and that' , surely nobody is going to offer the top range, as they've already intimated they know they might be being optomistic ?

Quite a few factors play a role in the price range. I did read somewhere that in today's climate 10% below asking price is an acceptable pitch for most sellers.

a house is only worth what the highest bidder is prepared to pay.

if you offer at the lower end of the range and no-one offers higher then the vendor may have to lower their expectations.

when i was looking to buy an estate agent friend was advising me to always offer under the price it was valued at as they are always priced higher than what they will get.

Really the only significance of a price range (or asking price for that matter) is that it gives an indication of how realistic/deluded the vendor is. Personally, I have always decided how much I believe a property is worth based on similar sales and market conditions, and offered accordingly. If anyone else is prepared to offer more because they've fallen for EA spiel, didn't want to offer too much less than asking etc, then that's their perogative and they're welcome to it.

Incidentally, I know of several cases of offers being accepted below the bottom threshold of this range-type pricing (including one in which I was involved).

Last summer I was looking for a house for DS in Yorkshire and noticed one in the price range £137-147k. He never got round to viewing it and next time I looked on rightmove it had sold. I saw recently on Zoopla that it had actually gone for only £125k!!

I suppose it depends where you're looking but I'd never be afraid to submit an offer below the lower limit, especially if you're chain free, etc.