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DavidGold

Ea Spends Money Trying To Lower Prices

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The following article took up 1/4 of a full page colour ad in a local paper, paid for by an independent EA in Ashford:

Why Overpricing May Leave You Out Of Pocket

As a seller, it is tempting to accept the highest estate agent's vaulation you receive. However, there are sound reasons why you should avoid overpricing your house initially, as overpriced homes often end up selling for less than they otherwise would.

First, buyers buy by comparison. Why should they buy your house if it is more expensive than a similar alternative? This simply does not make sense, and your property is unlikely to sell until such time as any competing houses have sold. By that time your house may have suffered overexposure and be "going stale" on the market.

Second, buyer activity is highest when the property is new on the market. If your price prevents buyers from seeing the house, you will have missed this opportunity and may have to wait some time before a suitable buyer is found. Competition between buyers drives up your price, whereas time on the market drives it down.

Sellers often say "But we can always take an offer!" The problem with this is that if fewer buyers see your house, the chance of an offer being received is significantly reduced. The wrong price also attracts the wrong buyers, who are therefore unlikely to offer in any event. This is because people tend to purchase a property at the top of their price range; so your likely buyer pool is people looking in a lower price range than your property, not a higher one. So don't scare away the right buyers!

Intense buyer activity in the early days of marketing is the key to achieving the highest price for your property, and our job is to help you stimulate such activity.

So be realistic. Be competitive. Quote the right price, stick to it, and you should readily secure the highest price for your home.

KM Extra Ashford Edition January 27th 2006 page 33

(Prices fell 1% in Ashford last year according to Halifax & Nationwide without pressure like this)

Is it just me or:

Do such articles not appear during bull markets?

Has some-one spent quite a bit of time and thought on this?

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I think it`s a reasonable attempt at re-educating customer aspirations and perceptions. It`s been stated many times that if these guys want to stay in business then they`ll have to sell houses. Makes no odds to most agents whether the sale is 300K, or 330K, but they need sales otherwise they`ll perish.

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Blimey. He is far too bright to be an EA.

That's what I was just thinking! Spot on if EAs want to survice the property cycle!

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That's what I was just thinking! Spot on if EAs want to survice the property cycle!

I think you are spot on - we had our house valued today

3 Estate Agents were invited and 2 of the 3 pretty much admitted that they need to bring some sanity to pricing otherwise they will ultimately suffer if (more like when) the market collapses

The same 2 EA's told me the local market was "at best steady" but better than dead months last Sept/Oct/Nov/Dec - they are hoping for a "spring bounce"

Their valuations were within a couple of grand of each other.

The third estate agent told me business was terrible late last year and still pretty dire with little sign of a "bounce"....he then happily valued the property 15% higher than the other two which was nice of him.

I think the more serious EA's are now totally sh1tting themselves they have pumped the market too hard for too long and its starting to come back to haunt them

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I think you are spot on - we had our house valued today

3 Estate Agents were invited and 2 of the 3 pretty much admitted that they need to bring some sanity to pricing otherwise they will ultimately suffer if (more like when) the market collapses

The same 2 EA's told me the local market was "at best steady" but better than dead months last Sept/Oct/Nov/Dec - they are hoping for a "spring bounce"

Their valuations were within a couple of grand of each other.

The third estate agent told me business was terrible late last year and still pretty dire with little sign of a "bounce"....he then happily valued the property 15% higher than the other two which was nice of him.

I think the more serious EA's are now totally sh1tting themselves they have pumped the market too hard for too long and its starting to come back to haunt them

so which valuation will you go with? :)

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I think you are spot on - we had our house valued today

3 Estate Agents were invited and 2 of the 3 pretty much admitted that they need to bring some sanity to pricing otherwise they will ultimately suffer if (more like when) the market collapses

The same 2 EA's told me the local market was "at best steady" but better than dead months last Sept/Oct/Nov/Dec - they are hoping for a "spring bounce"

Their valuations were within a couple of grand of each other.

The third estate agent told me business was terrible late last year and still pretty dire with little sign of a "bounce"....he then happily valued the property 15% higher than the other two which was nice of him.

I think the more serious EA's are now totally sh1tting themselves they have pumped the market too hard for too long and its starting to come back to haunt them

ONE OF THE BEST ANECDOTES I HAVE READ IN A LONG TIME!

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so which valuation will you go with? :)

Hi Halebop,

Its probably not the answer you were expecting :P

We are probably going with one of the 2 that valued it within a couple of grand of each other.

The reasons being

a) I think the highest valuation is a bit too high (we know the local market quite well and have followed its progress closely for past 12 months)

b ) The longer our house is on the market the higher the risk it will devalue if (when) the market crashes and the probability of any house prices increases in the meantime is about zero. We are planning to sell and moved into a rented house so if we can get our timing right we could be laughing.

c) I actually think one of the 2 agents knows this area and market really well - our property is in the heart of their catchment area and typical of the property type that they market

d) When I asked the one I am going to use "How will we know if we have under-priced it" he gave a superb answer which was "Buyers will be queing up with viewings and making good offers - if this happens we go to full and final sealed bids which means you get the actual TRUE MARKET VALUE. i.e. WHAT SOMEBODY WILL PAY FOR IT AND NOT WHAT I SAY ITS WORTH" !!!

Edited by eternalnomad

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I think you're doing the right thing nomad - when we put our house on the market 2 years ago, we had a feeling it as worth GBP 350K. The valuations came in a bit above that & we chose the EA who gave the highest vlaue - partly out of a wish to maximise our return (=greed!), but ,mostly because at that time they were THE agents - had most properties and a reputation for favouring its customers when it came to properties that you wanted to buy. They turned out to be complete rubbish, and we failed to sell, so after 6 weeks, as we knew the market was wobbly, we insisted, in the teeth of their opposition on lowering to GBP 360K. We gopt a buyer, but they dropped out at the first 'house prices to drop by 20% headline'. We moved agents as soon as we could, and eventually sold for... gbp350 - and count ourselves very lucky now!

Funnily enough, the EA that used to give quite sensible prices is now really over the top - I had a go at them yesterday (anonomously, natch) about the way they price houses, and hadn't they seen the Halifax index showing prices fell in Surrey in 2005?

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Oh what a shocker!

NOW EA's say prices should be lowered.

Why?

Cos its in THEIR interests.

F**K EM.

Keep the prices high....... keep houses on the market for ages..... lets the C**TS go out of buisness, then lose their houses, then get a new job and see if they buy another house at todays prices.

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d) When I asked the one I am going to use "How will we know if we have under-priced it" he gave a superb answer which was "Buyers will be queing up with viewings and making good offers - if this happens we go to full and final sealed bids which means you get the actual TRUE MARKET VALUE. i.e. WHAT SOMEBODY WILL PAY FOR IT AND NOT WHAT I SAY ITS WORTH" !!!

Any EA tries the auction trick with me and I will immediately withdraw my offer and leave. The book Freakonomics says EAs convert knowledge into fear and this is a prime example of pressurised sales tactics. Is it any wonder they have a bad reputation?

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So be realistic. Be competitive. Quote the right price, stick to it, and you should readily secure the highest price for your home.

KM Extra Ashford Edition January 27th 2006 page 33

Great for an EA to do something like this, but the above sentence is still all too typical - the 'right price' is what buyer is prepared to pay. Vendors just might have to be flexible (yes, flexible!). He might have said: 'Quote a fair price, watch the market carefully and be prepared to accept a reasonable offer in the current market conditions. After all, if the value of the house you sell is lower than you expect, so too will be the value of the house you purchase, and no-one loses out.'

I admit, though, that the ad was definitely a step in the right direction!

If anyone has registered on the expats thread they might think about posting the EA ad there. Should give them a little bit more scope for worry. ;)

Lovely idea!

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  • 301 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



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