Overvaluation in a falling market
We have commented in the past about the damage that some estate agents do in deliberately overvaluing properties to get them on their books. In a rising market they get away with it because eventually the rest of the market catches up. In a falling market it’s different. So why do they do it and how can you spot them? Maybe its force of habit or maybe they think that if they can get enough properties on their books in a given area they can effectively create their own little internal market by churning them...who knows? As far as spotting them is concerned that’s quite easy. If you get three appraisals and one is wildly optimistic then it will stick out like a sore thumb. Phrases like “It’s worth £400,000.00p in the current market but lets put it on at £450,000.00p to give us some room for negotiation” are another tell-tale sign. This form of delusion is bound to fail since most would-be purchasers can access historical house price data on the internet and that big ticket price will simply put them off. If you’re selling then it’s best to go with the agent who will tell it straight and help you price your property at a level that will create interest.
Compliance Officer for Legal Practice
Andrew oversees the Firm’s Quality Systems and is committed to making sure that our client’s receive the very best customer care and attention along with the best marketing and legal advice in the area.
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