Neighbours selling way below true value (impact on us.)

[GloriousGoodwood]

This is a WWYD but I accept there is nothing to do really.
A neighbour has recently put their house on the market at 20-25% lower price than ours was valued at by the same agent, some time ago. It's also too cheap looking at other neighbouring houses that sold this year. This is in an area where prices are rising and always have been.

They clearly want a quick sale. The same agent sold an identical neighbouring house last year at the same knock-down price (sold in days.) Again, the vendors only wanted a quick sale and weren't fussed about the price.

However, as there are only a few of these houses of the same design in our road, it's not going to make it easy for us to sell ours at what we (and several other agents) consider the right price, when we decide to move.

Don't get me wrong, I'm not deluded, but these two houses were marketed way below their real value (elderly owners not really in touch with the market.)

We've muttered a few things to them querying their valuation compared to ours, but they don't seem to want to know.
How are we going to sell ours at the 'right' price?

I think a doer Upper can easily be 20 or 25% less value wise.

We bought a doer Upper last year for 214 and sold it for 300 Easter time

We had it the other way. Have bought a house which the survey valued 15k less, based on others in the road. They are mostly elderly sellers and houses that need a lot of updating around the 250k mark. We were prepared to pay the bit extra as the house needs nothing doing, saving us not only the cost but the hassle and disruption. If it's a well presented house someone will appreciate the value of your work.

They're not selling with Express Estate Agency are they?!?

We are now in another doer upper. A 1930's semi. It needs new bathrooms, new kitchen, new electrics and heating, new carpets, new windows, walls knocking down, plastering, painting, new front door, garden landscaping after getting rid of 70's cement monstrosity, new fires to replace 70's brass numbers. That easily 60k's worth of work. And if we sold the property after the work we would make a reasonable amount. Doer uppers don't have the same attraction that they did in the 1990's. People usually want houses that don't need work.

It's not the agents or the other vendors job to worry about the value of your property. Not really sure why you think they owe you anything on this?

We went on the market in 2008, didn't sell after a year, despite dropping the price.
We went on the market in 2015 at the same price as 2008, 16 viewings in a fortnight and sold to one of those.
Since then, all houses of a similar stamp have sold for less in that area. The market is definitely on the slide.
Your house will realise it's true price regardless of what price you put on it. If it's not as much as you need, you'll either have to set your sights lower on your next property or stay put.

My parent's sold their house £80k below those that have sold on their road. They were about to be repossessed, I'm certain they didn't two hoots about selling low and neither should they!!!
You don't know people's reasons for selling and shouldn't judge.

They might have had real issues with damp or something else hence the lower price.
Unless you are selling within 6 months of the previous houses being sold it won't matter so much.

Also 2007 was a peak, then the market slowed/dropped and only recovered to similar values by 2015. They continued to rise slowly 2016 and 2017. There's been Brexit instability and lots of politics in the background.

Selling in two years when things are clearer could be good?

We're the flip of your issue - we're the buyers who are in the process of buying a house priced very low from an elderly vendor. Their neighbours have also been complaining about them selling too low because they paid 100k+ more when they bought only last year (I know it's not you, OP, because we're in London!).
What the neighbours don't seem to comprehend is that the house needs a lot work to bring it up to the standard of theirs (I found their old listing on Rightmove and it was worth every penny of what they paid for it, it's gorgeous).
We're talking ripping out 80s fittings, damp coursing, replastering, new electrics, plumbing, boiler, new kitchen, bathroom, sorting out a flat roof and total redecoration throughout. What we're paying is the market value for THAT house, not the neighbouring one. Once we've done the work, ours will be worth the same, if not more.
My point is, don't panic until you see what the new owners do with the place. I bet whoever buys it will need to do it up. Then, when you come to sell, you can instruct your estate agent to tell anyone who queries it that it was bought as a renovation project. Also, don't forget that Rightmove listings move into the House Prices section - complete with images - after a sale completes. So if anyone checks the prices for the street, they'll be able to see from the images that the house needed work and that's why it was so cheap.

My next-door neighbours but theirs on as offers over a ridiculously low price, with no intention of accepting that low price. At the time I was in the processes of remortgaging for a better deal. They total messed that up for me, as mortgage company just did an online evaluation and knocked about 40k off my property value, ie all my equity. I ended up stuck on the old crap interest rate for several years longer after that.

I'm just pissed off that they are going for a quick sale which will take down the average price for the road and also impact on us.

This made me lol! Unless you are selling right now, there is no impact. It will depend on the market at that time.
Discrepancy between a done up house and one needing renovation can easily be 150k...

It sounds like it was priced competively and someone snapped it up, for all we know there was a bidding war and prices went above asking. And if prices crash, some might say they overpaid

The price is usually advised by the EA, and as EAs are paid on a % of sale price it is hardly in their interests to sell houses at a lower rate.

This is nonsense, as a PP explained previously. Some estate agents are well-known for it. One agent wanted to sell a house of mine for 25% less than the aale price it achieved in 4 weeks.

A lot of people have offered you valuable insight. The sale price will eventually tell you what you need to know. I can see why it would be a minor annoyance.

People are astonishingly naive to think agents don't undervalue properties for a quick sale.

Some years ago I was selling my house. I got 3 agents round, 2 large chains, one smaller independent. There had been a few houses sold in my street in the previous couple of years so I had a fair idea what my house was worth. The first agent told me a price which was less than some of those houses (despite mine being bigger, end of terrace and the only house in the street with a garage). Other agent said similar. 3rd valued it 30% above both. It sold for 25% above - so not as much and it took a few months, whereas I know if Id gone with agents 1 or 2 it would (like all their properties) have sold within days. Because that price was just too low!

As to the effect it has, many agents sre pretty fucking lazy. When OP comes to sell in a year, they'll refer to neighbors house and tell her that hers is worth similar.

I know because i had an agent round to value my current house a few months ago. He based his valuation on a couple of houses sold in my street and the adjoining one in the last few months. Despite 1 house being half the size of mine and quite basic inside, and the other having been sold very cheaply. neighbors house which was sold recently. His valuation was a good £100k out in my view. I'm not selling yet, but it reinforced in my mind that if you know the local area (I've lived here, like the OP, a long time) you will know what the value is often better than agents who are either lazy in their research, or deliberately undervaluing to make a quick sale. Possibly for a buyer they already have lined up....

People are astonishingly naive to think agents don't undervalue properties for a quick sale.

Some years ago I was selling my house. I got 3 agents round, 2 large chains, one smaller independent. There had been a few houses sold in my street in the previous couple of years so I had a fair idea what my house was worth. The first agent told me a price which was less than some of those houses (despite mine being bigger, end of terrace and the only house in the street with a garage). Other agent said similar. 3rd valued it 30% above both. It sold for 25% above - so not as much and it took a few months, whereas I know if Id gone with agents 1 or 2 it would (like all their properties) have sold within days. Because that price was just too low!

As to the effect it has, many agents sre pretty fucking lazy. When OP comes to sell in a year, they'll refer to neighbors house and tell her that hers is worth similar.

I know because i had an agent round to value my current house a few months ago. He based his valuation on a couple of houses sold in my street and the adjoining one in the last few months. Despite 1 house being half the size of mine and quite basic inside, and the other having been sold very cheaply. neighbors house which was sold recently. His valuation was a good £100k out in my view. I'm not selling yet, but it reinforced in my mind that if you know the local area (I've lived here, like the OP, a long time) you will know what the value is often better than agents who are either lazy in their research, or deliberately undervaluing to make a quick sale. Possibly for a buyer they already have lin

Sorry for double post!

Thanks for all the comments. TBH I'm a bit fed up of all the assumptions around neighbour's plans, incomes etc. I posted as i was pissed off. They want a quick sale, they aren't up to date with the market, if they'd done any research at all they'd have seen almost identical houses (some even smaller) in the village being sold for £50-70K more, a few weeks ago.

The neighbour's is not a doer-upper, there are some differences but not that account for £75-100K.

If I was house hunting and saw in record that a house in the street sold a year ago for a lot cheaper I would assume it needed work doing on it

You look on RightMove Sold and see the house.

Agents don't give a toss because as someone pointed out, the commission on £75K -100K for them is peanuts, when all they want is a quick turnover- volume.

Our agent has been supportive saying they and we will focus on the 'quick sale' story and also how ours is better in some respects (quality fittings, bigger plot, etc.)

Estate agents do undervalue for a quick sale and their fee. We had that with a independent agent who didn't have much business and so needed funds.

We bought a house below market value, as we were not in a chain and the seller had to go away and lie low for a few years (problems with the law and loads of unpaid debts, we found this out later)

Another house in the street sold "cheaply" as owners were emigrating.

It never affected the house prices in our area aversely. Other houses, where owners were prepared to wait it out, sold at 20-30/ more.

You are silly to worry about this, esp. as it is outside your control. Are you generally very anxious about money? It really should not affect the value of your home. At all.

How is your property different to the ones sold cheaply

Velvet thanks for saying the same thing. IMO the agents asked the owners what they wanted for it and as money is not an issue for them, and they want to move fast, they have come up themselves with a figure. Why should the agents argue? If they can sell at £600K with no work rather than struggling a bit more to sell at £700K, which would they choose? (These are not the actual figures.)

We sold a relative's house not that long ago. Same thing; we'd spent a long time researching prices and said what we thought was the value. Agent said it was too high. We stuck to our guns and it sold quickly.

How is your property different to the ones sold cheaply

Have no advice but we're in the same situation.

NDN1 sold their house 6 years ago during the recession at £65k less than they'd bought it for 3 years previously. They weren't bothered as they wanted a quick sale, had paid lots of their mortgage off and aren't short of a few bob.

NDN2 (the new owners) obviously bought for a knock down price so when they came to sell last year they needed to do so quickly to get into a catchment area where houses sell super fast, so they sold for £30k under value (I'm talking about houses that are worth around £270k so this kind of amount makes a big difference). Unfortunately, we already had our house on the market at the true value so had no chance of competing.

We live in a small estate that's around 12 years old and have definitely found that these 2 sales of the same house have affected the market just in this estate. And then the market has seriously slowed everywhere this year so we're having to stay put for now. I feel your pain.

My neighbour recently passed away. His house was valued between £150,000-165,000. Its been sold for £89,000 because the family wanted a quick sale.

Another neighbour in the same style house had it up for £175,000 for around 3 years. They've just accepted £125,000 because they're fed up of waiting for a sale. The EA have still valued mine at £170,000 despite none of the houses selling for anywhere near that.

There's an EA locally renowned for their ability to sell houses quickly. If you want a quick sale or cheap house you go to them. If you dont mind waiting it out then you go to any other EA. They drastically under value houses to get that sale. I've had 4 valuations. 3 around the same figure £165-170,000 but the other one valued it at £110,00 with their guaranteed sale within 28 days.

If you are looking st houses that sold a few weeks ago then the sales were probably arranged pre-election when there was (some) more certainty about the government for the next few years. Things are more uncertain now which may account for a small element above and beyond the tired decor.

Ok thanks all. I'm leaving this now.
I'm being asked to 'defend' and explain myself, prove how I'm 'right' , with lots of posters talking to me as if I don't know anything about house selling or the market. You are all inventing stuff like the work needed or not needed. I've lived next door to them for 20 years and know their houses! Do you think I'd not consider things like you said cherry!
As I said, fact is it's on cheaply for a quick/panic sale. That's really all anyone needed to know, and my question was it puts us in a slightly tricky situation when we sell.