Straight off the bat, let me start by saying it is the estate agent’s duty to get the best price and the best sale for your property. This is what I have always believed throughout my 28-year career as an estate agent. This is what I practice (and preach) here at YOUhome and this is how it should be. For me, honesty and transparency as an estate agent is critical in delivering the best outcome for my clients.
However, securing the best price isn’t achieved by merely asking an over-inflated price in the hope that someone will come along and make an offer.
It is far more complex than that. The sales process is a journey and not just a point in time at the start.
It has been well documented that moving house is one of the most stressful things that we are likely to do in our lifetime.
In fact, A Which? survey at the start of 2016 revealed adults considered moving house more stressful than having children, changing jobs or getting married.
A huge 70% of the 1,990 people surveyed by the consumer website cited moving home stress as their top worry. Only topped by divorce as the biggest cause of anxiety and tension. The whole process from beginning to end can be a physically and emotionally draining experience. Some estate agents should take responsibility for their part as the cause of this stress. According to Zoopla research carried out in 1988, Britons move home every 8.6 years. This was against the backdrop of a buoyant market and strong economic growth. This same research carried out in 2017 showed that Britons move home every 23 years. Either way, it would be fair to say that moving home is not something that most of us do frequently or have much experience in.
Therefore, home sellers rely on the honesty and advice of people within the business, such as Estate Agents, Financial Consultants, Solicitors and Surveyors.
Choosing and instructing an agent is a difficult decision and this is where some of the stress begins. How do I choose the right agent? What am I looking for? Aren’t they all the same, how are they different? As a home seller, you should consider a whole host of criteria and questions to pose yourself, before speaking to an agent. What is it that you want to achieve and in what time frame? What’s the perfect outcome? Instructing an agent should be like entering into a partnership, with one (the agent) facilitating the other’s (your) needs and requirements while offering factual and considered advice. At YOUhome, we call this “intelligence throughout the sale”.
Estate Agency is a service industry and the customer, you, who in this case is the home seller, should always come first. First, above the agent’s need to increase their “Market Share”. First, above the agent’s desire to show “Market Appraisal to Instruction” ratios to their directors or shareholders. First, above the necessity to achieve a quick sale because it has been a “lean” month in the office. Many estate agents will (deliberately or otherwise) over-inflate the value of their estimate on price to “win” the home seller’s business.
This strategy in an upward market often doesn’t have much of a downside, as in a rising market, prices increase, and the proposed “bullish” figure, in time could be achieved.
Conversely, if an agent adopts this tactic in a static or declining market, the consequences to the home seller can be very costly. Sometimes thousands and occasionally hundreds of thousands of pounds can be “lost” by being misadvised deliberately or through a lack of relevant market information and understanding by an agent.
I have first-hand experience of a client who instructed Agent A at an asking price of £4,200,000 (for 4 months). Agent B took over and asked £3,850,000 (for 7 months). Agent C and Agent D were added and asked £3,850,000 (for 1 month). Agent E took over and asked £3,250,000 (for 1 month). YOUhome sold the property and achieved £2,950,000 within a month. Was this the home seller’s fault? I don’t believe so. The sellers were listening to and acting on the advice given to them by their estate agents at the time.
They were keen and motivated sellers and very amenable to taking advice, but they were being given the wrong advice. Either the agent simply didn’t do any or enough market research and therefore got it wrong. Or, they were more interested in “winning” the instruction for one of the reasons that I have outlined above. The sellers were pleased with the final sale price and understood why their home’s true market value landed at this amount.
In another example, I was invited in to meet with potential clients who were considering selling their property. After carrying out my research, reviewing the market data and looking at comparable evidence, I suggested they should achieve a price somewhere between £1,150,000 and £1,200,000. They instructed Agent X at an asking price of £1,300,000 for 3 months and then took the property off the market. They then instructed Agent Y at an asking price of £1,295,000 for 3 months. They then instructed Agent Z at an asking price of £1,295,000 and 8 months later the property sold for £1,185,000. I am convinced that had they taken my advice from the outset; they would not have had to put their lives on hold for 14 months to achieve the same (if not better) result.
My advice to home sellers is this:
● Watch out for contract break clauses. You don’t want to be tied into a long and lengthy contract with an agent that you can’t break. Particularly if they fail to deliver on their promises.
● Ask to see and go through the comparable evidence, data and research that the agent has carried out when arriving at their suggested asking price.
● Find out who exactly will be showing prospective buyers around your property (which is likely to be your biggest asset) and ask how experienced they are.
● Make sure that you are given regular updates, feedback and advice about what the agent is doing to find you a buyer.
● Even when you have received an offer, ask the agent for evidence so you know that it is likely to be the best offer.
● Instruct a good solicitor as soon as you have instructed your agent to prepare papers in readiness.
In the current climate "Time Is Money".