There are just over one million residential properties for sale in the UK at present, which means that the average estate agent has 74 properties on their books - more than at any time since 1999. This is according to top property website Rightmove, and its latest June House Price Index is candid: for six months now, asking prices have been rising - but transactional volumes remain at just about half of what they were in 2007. Buyers' resourcefulness and caution, a large choice of homes on the market and tight mortgage lenders all add up to encourage Rightmove to call the ongoing price rise a "romp away from reality". So why the romp?
It's the estate agents fault of course. They are the ones entrusted with the valuation of prospective houses to market after all. There are doubtless many that just get it wrong when called to impart valuation advice. Lack of training and market knowledge are endemic within a property industry that has no requirement for qualification or licence to trade. Some estate agents are undoubtedly purposefully over optimistic with their assessments of people's homes. The business is full of stories that the larger corporate companies over value on purpose, adding as much as ten percent to the real value in order to flatter the home owner into instructing them over and above their competitors based on hope value alone. Three to four weeks later you'll start to receive the weekly calls to 'reduce your price please, Sir'. But the biggest reason that so many properties are languishing on the sales shelf unsold? You...
You? Yes, you're far too precious about your property and totally unrealistic about its value. When an agent steps over your threshold he'll have to share your enthusiasm for the ceiling fan in the conservatory and the cavity wall insulation that makes your property far superior (and infinitely more valuable) than the house two doors down which is still on the market after six months. It used to be just fishermen telling stories about the one that got away. Now you're more likely to hear that kind of story from an estate agent speaking less about fish and more about sales. Those sales don't happen because 1) it's a rubbish market, 2) it's a rubbish estate agent and 3) mortgage lenders are rubbish since it's impossible to get a mortgage by hook, crook or any other means. But the real truth of the matter is that if estate agents were prepared to tell lenders about the true value of their property, and if vendors were prepared to listen to what estate agents said, three things would happen: buyer expectations and asking prices would start to match ... buyers who actually want to buy would buy from sellers who actually want to sell ... and the market would soon start to sort itself out of its "preciousness".
In the meantime, agents will continue to tell you what you want to hear because they are too afraid not to.
And so, as Rightmove rightly says, we're all stuck in limbo and it's a limbo that shows no sign of unromping.
It's the estate agents fault of course. They are the ones entrusted with the valuation of prospective houses to market after all. There are doubtless many that just get it wrong when called to impart valuation advice. Lack of training and market knowledge are endemic within a property industry that has no requirement for qualification or licence to trade. Some estate agents are undoubtedly purposefully over optimistic with their assessments of people's homes. The business is full of stories that the larger corporate companies over value on purpose, adding as much as ten percent to the real value in order to flatter the home owner into instructing them over and above their competitors based on hope value alone. Three to four weeks later you'll start to receive the weekly calls to 'reduce your price please, Sir'. But the biggest reason that so many properties are languishing on the sales shelf unsold? You...
You? Yes, you're far too precious about your property and totally unrealistic about its value. When an agent steps over your threshold he'll have to share your enthusiasm for the ceiling fan in the conservatory and the cavity wall insulation that makes your property far superior (and infinitely more valuable) than the house two doors down which is still on the market after six months. It used to be just fishermen telling stories about the one that got away. Now you're more likely to hear that kind of story from an estate agent speaking less about fish and more about sales. Those sales don't happen because 1) it's a rubbish market, 2) it's a rubbish estate agent and 3) mortgage lenders are rubbish since it's impossible to get a mortgage by hook, crook or any other means. But the real truth of the matter is that if estate agents were prepared to tell lenders about the true value of their property, and if vendors were prepared to listen to what estate agents said, three things would happen: buyer expectations and asking prices would start to match ... buyers who actually want to buy would buy from sellers who actually want to sell ... and the market would soon start to sort itself out of its "preciousness".
In the meantime, agents will continue to tell you what you want to hear because they are too afraid not to.
And so, as Rightmove rightly says, we're all stuck in limbo and it's a limbo that shows no sign of unromping.
About the Author:
Using High Street estate agents means paying high fees. Using eMoov, the UK's leading online estate agents instead will get your estate sold by showing it to 170 million internet visitors each month. No extortionate commissions, no percentage fees, no sole agency tie ins. Just a range of fixed, low cost state agents fees which might even make you begin to like estate agents again. Well, some of them.
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