Estate agent valuations £75k apart

[ladeedar]

I’ve never sold a house in the U.K. so I’m new to this way of selling/buying.

Estate agents have valued our house very far apart. For context we bought it in late December 2019 for £485k. It was on for £495k and we were told she had others offers over £500k but stuck with us (various reasons).

HPI says £617k. Estate agent one says £599k possibly more so do offers in the region of. Tenants who are moving said they thought roughly £580k.

Then second estate agent says £525k

I have got two more coming to value - but I guess my question is - is this normal? The likely sale price is a huge factor in whether we sell now or not.

Its not so much what its worth but which price bracket will get them you a quick sale. Keeping it under £600k will put you in the search parameters of someone looking at a £500-600k house, whereas anything slightly over that puts you in with £600-700k houses, so presumably fewer buyers and more impressive competition.

£617k is totally pointless, you may as well go for £625k or £650k at that point and expect people to make an offer - I’m not sure what the stamp duty bands look like these days but that will make a difference too.

And yes, normal - mine was valued at £720k on Zoopla, estate agents said £650k. Identical house up the road sold for £610k a few weeks ago.

Sorry to be clear HPI is the house price index. For context - estate agent one talked about that, zoopla etc. Estate agent two hasn’t yet how he got to 525k. They’re so far apart I just don’t get it.

Zoopla valuations are usually way off.

I'd expect any EA coming to value and tell you how they would look to market to have comparables - agreed sale prices and recent sold prices, not just asking prices. Ask the lower valuation EA to explain his rationale. Also was he saying what he would market it at rather than what he thought it was worth? If he can't or won't explain then you know not to bother with him. It may be that he thinks pricing lower will encourage competition and a bidding war meaning you'll ultimately get more than marketing at a higher price with some buyers being discouraged from viewing/making offers.

We always asked what their valuation was and what their selling strategy would be, including asking price, plus what they thought we would actually get in the current market. If they're active enough locally they should have a very good idea.

House prices are not absolute and some can be very difficult to value.

You need to go on RM and look up similar houses for sale and also look at similar recent sales and see what they went for. This can give you a good indication of what yours is worth.

It the house is say on an estate it is normally very easy to value as there will be others of similar type that have sold recently.

If it is a unique/old house it can be really hard to determine what it would sell for because there is no reference point except the last sale. Did you determine your price on the UK HPI or on the local HPI whcih should be available ?

The prices given indicate an average of 568K and no valuation differs from the average by more than 10%.

You need to remember some agents value high in order to win the instruction. And will talk a load of pony about "bidding wars". Then when it doesn't sell they "manage down" the vendors expectations. Some are more realistic, especially if they have lots of property on their books that isn't moving, because it makes little sense to take on yet another property at a high price that won't sell.

Estate agents basically just give you an educated guess, based on sold prices of similar houses in the area. It’s not an exact science. Ultimately a house is worth what someone is willing to pay for it.

I’d get it on the market at the higher price and see what offers you get. If you get an offer that allows you to do what you want to do then accept it. If you only get low offers that don’t make it worth your while selling, then take it off the market.

Is your house unusual in some way? Valuing a property isn’t an exact science, particularly where there are specific desirable locations or unique features like character or a view. Sometimes it’s just a matter of putting on the market and seeing what happens.

I sold a house a few years ago. 3 valuations: 580, 620 and 700! We listed for 650 and sold for 640. It was quite an unusual place.

It's normal. Estate agents have different ideas of what a house is likely to fetch, and some like to push the prices up to get more commission and to be more attractive to sellers, while others pitch them lower hoping for a quicker sale.

We had valuations from £450k - £575k. I knew that the ones valuing it at £450k were doing it for a quick sale. I also knew £575k was too high. We went on for £525k (based on my knowledge of the adea) and sold for £525k too.

the varying valuations are common but if you’ve got a price in mind, go with that.

As an aside, why not simply list the house at the price you want for it ? Then if someone comes along who will pay that price you sell.

The list price is a starting point and there is no guarantee the market will deliver up a buyer for that price., or that 10 buyers won't turn up and start a bidding war.

Good advice from poster above to go on Right Move and see what the various price points get you (and the actual sold prices) and judge where yours fits in. It’s very subjective though. Location makes a huge difference, so a gorgeous house on a very busy street could be less than a not so great house on a more desirable road. Try to find something similar to yours in terms of size, general condition and location that’s been recently sold to see where to pitch yours.

Some UK estate agents will knowingly over value to get the business.

Their mind set is
seller wants most £££ they can get
we will lie and tell them they can get £££ x 2
they will give me the instruction
it won't sell
I'll give them the old soft soap its a difficult time in the market, and get them to drop the price.
house sells and I get my commission
Happy days.

Unless you independently think the highest value is borne out by the market, I would avoid the inflated valuer estate agents like the plague. It's a sign of bad and very unethical (by the standard of a not very ethical group anyway) agents.

I just listed one of my properties for sale. The agent looked up the previous listing to get the layout and came to the meeting with a good idea and comparables for me to look at to justify his valuation. I also did my research. He suggested £325, but to test it (and leave wiggle room) I asked him to put it on for £339,950. I often go a bit above valuation because the agent wants a quick sake and £20-50k is not going to make much difference to their commission, but it’s a lot to me. Usually I’m right and get nearer my price.
So do your research, get the other agents in, consider how soon you want to sell etc. Tempting as it is to go with the highest valuation that may not be the best.

@SnowflakeSmasher86 ”£617k is totally pointless”

There is a house that isn’t selling on for £587,500 I monitor.
He is chasing the market down though, last summer he was on at £650k

yes it’s usual to have a variation in valuations especially if there are no recent sales of comparable houses locally and by recent I mean within 3 to 4 months , the prices go up and down frequently, more so in some areas than others and can vary considerably street to street .

I always get several valuations , use good local agents who sell similar properties locally to yours , I usually settle around the middle valuation and go with the agent I feel is wanting to get a result best for me , who I feel I will get on best with , may have been recommended to me , and will offer the exact service I need

Yes it’s normal

i sold a house for £380 on the second day it was up for sale, valued at £390 & £325. This was 25 years ago and was a large % of the sale value, especially when the next house was £115k

It’s difficult, isn’t it. We’re going to put ours up soon. It’s a very unique house, so nothing to compare to. We think around £400. The estate agent (who seems very on the ball in the area) thinks a bit over £400k, but wants to market it at £400 with the expectation that it will get lots of interest and probably go to bids. His reasoning is if we put £415/420 it would be at the bottom of another Rightmove bracket. But it makes me nervous- the house is gorgeous, and in a great country location, it’s 300 years old abut needs a fair bit of work. It’s priced to reflect that, it probably needs £60k of work but would be worth £150k more if done. But I worry that people may want a slight reduction in their offers because of this, and id not want it to go below £400 really. Hard to know what to decide.

I'm surprised with the cost of work now that 60k would make it worth 150k more. Are you costing the 60k based on materials only?

I do think unique properties are difficult to value. They probably sell themselves but have limited range of purchasers looking for whatever its uniqueness is.

If a property doesn't have easy local comparables, it can be hard to value. For example, we had very different valuations on a converted barn in a road full of Victorian houses because the EAs couldn't just compare our house to it's neighbours and what they had sold for.

But an EA who mentions Zoopla is a red flag - they should be using their local knowledge and experience not talking about Zoopla which isn't a reliable metric at all.

So to answer your question, it can be normal depending on the type of property.

You can decide that there’s a figure you won’t go below, but a house goes for what someone is prepared to pay. There are two choices then. Either expectations are adjusted, or you remove it from the market.

Although it’s essentially a financial transaction, the fact that it’s your home means that heart comes into it as well as head. No one wants to think their house is unloveable and we invest much of ourselves in our homes. To others, it’s just a house.

All the agents we dealt with last year came with information about sold prices of similar local properties and all the valuations were less than 25K apart.

very normal

as an aside - it really is worth what people will pay. If something doesn’t sell within 3 months it’s too expensive. I’m amazed at some of the properties round here that won’t reduce. I guess they can’t afford to move where they want so are holding out 🤷‍♀️

Thanks all very helpful. Had another one today for 560k. Got two more Friday so I’ll keep you posted.

It needs a new roof, new bathroom and two rooms plastering. We’re currently doing up a similar aged house and have just paid £12k for a new bathroom and two rooms to be plastered. The roof is old stone, which costs a lot to replace/repair, but if you sold the old stone (which is quite rare to find nowadays so sells well) and replaced it with a cheaper stone or slate it would make the new roof much cheaper. A lot of old houses in the neighbourhood have done this.
It’s a really cute stone cottage in beautiful countryside. The estate agent said he compared it to an immaculate, finished house about a mile away that is a similar age/size, which he sold for £150k more last year. Ours is probably in a nicer position with better views. But it is a different market to a “normal” house. It’s beautiful, but a different way of life. We’ll see what happens.

You also need to bear in mind that some estate agents value high to woo you to list with them. Some will suggest a certain price to "test the market", and some will say a certain price to list but give another price they'd expect you to get offers at. You really need to know what approach you are comfortable with and go in with open eyes if you are picking the high valuations. Likely if you list higher, it'll take longer to sell and when offers come they'll be below asking. If you list low, aka "price to sell", more chance of getting it snapped up, and in the right property you might get a bidding war and get over asking- or you might not. It's a gamble but one you need to take with open eyes.