How To Value Your House
At a dinner party last weekend, I was asked what I did for a job. As often happens, the answer meant that I was bombarded with stories of other agents' disastrous dealings and cries of how rubbish they are. Once the frustration had died down, I was then asked 'so, how do you know how much my house is actually worth'' This is always an interesting question as there are a number of ways estate agents will arrive at a price, particularly when as in Oxford, the demand for properties is still outstripping supply. Firstly, and I have to say in my opinion, by far the best way for an agent to give a realistic and honest answer is to look at prices of comparable properties sold and for sale in the area. Pricing needs to be realistic and attractive enough to encourage applicants to view and for a property to actually sell. The second, and in my opinion, incorrect option, would be to suggest a price that one believes the vendor wants to hear. Now there is nothing wrong with this if you know that the vendor understands the local property market and has a good idea of what he or she wants to achieve, as long as you bear in mind the value of other properties on the market that your buyers will be comparing it to. The third option (and the one that so often gives estate agents a bad name), is to suggest an over-inflated figure far and above the other agents' valuations, one which is intended to win the instruction hands-down. Unfortunately this is simply a gimmick to win over a vendor and this price will usually be reduced at a later stage to the realistic agent's original figure or even lower, when the property fails to sell. 'So which price would you like'' I said. The realistic one or the 'win-the-instruction one''. Having been presented with the cold hard facts, my fellow diners agreed that the realistic price was the better one and that their poor experiences were mainly due to the fact that they had been seduced by the over-inflated prices and handed over the keys to their property without doing their homework first and researching the local property market for themselves beforehand.
This is always an interesting question as there are a number of ways estate agents will arrive at a price, particularly when as in Oxford, the demand for properties is still outstripping supply.
Firstly, and I have to say in my opinion, by far the best way for an agent to give a realistic and honest answer is to look at prices of comparable properties sold and for sale in the area. Pricing needs to be realistic and attractive enough to encourage applicants to view and for a property to actually sell.
The second, and in my opinion, incorrect option, would be to suggest a price that one believes the vendor wants to hear. Now there is nothing wrong with this if you know that the vendor understands the local property market and has a good idea of what he or she wants to achieve, as long as you bear in mind the value of other properties on the market that your buyers will be comparing it to.
The third option (and the one that so often gives estate agents a bad name), is to suggest an over-inflated figure far and above the other agents' valuations, one which is intended to win the instruction hands-down. Unfortunately this is simply a gimmick to win over a vendor and this price will usually be reduced at a later stage to the realistic agent's original figure or even lower, when the property fails to sell.
'So which price would you like'' I said. The realistic one or the 'win-the-instruction one''. Having been presented with the cold hard facts, my fellow diners agreed that the realistic price was the better one and that their poor experiences were mainly due to the fact that they had been seduced by the over-inflated prices and handed over the keys to their property without doing their homework first and researching the local property market for themselves beforehand.
