Six reasons why you shouldn't overvalue your property
Updated: Mar 18, 2022
At Matthews Estate Agents, we can’t stress enough how important it is for a seller to set a realistic asking price for their property. For any regular readers of our blogs, this topic might seem like it’s been beaten to death. However, as an estate agent in Birmingham, we feel it is our duty to ensure that our readers are best equipped to sell their property in a reasonable time frame.
1. Creating a good first impression
Growing up, I remember watching a TV show called House Doctor. Ann Maurice would help people struggling to sell their property by giving it a make-over. People that had already viewed the property before the transformation would then be invited back to see if they were now more inclined to make an offer for the property.
In reality, if you don’t hit the nail on the head the first time around, you might not get an initial viewing, let alone a second one. Therefore, when you’re advertising your property, make sure you set a realistic asking price because that ball isn’t going to start rolling by itself. And by having a realistic asking price, you can create a good first impression with several buyers, and potentially get more than what you were asking for.
2. Your property will receive less engagement
Speaking of advertising, property portals such as On The Market allow potential buyers to filter out properties within their search that are above how much they’re willing to pay. Therefore, John and Jayne, first-time buyers who are chain-free, who have a mortgage in principle for a property worth £200,000, didn’t see your property for sale because you unrealistically priced it at £225,000.
Additionally, by pricing your property unrealistically, the properties within the same price range that were valued realistically are going to seem far more appealing compared to your property. By the same token, properties similar to yours that were valued correctly at £200,000, are going to receive far more attention.
3. Falling at the last hurdle
Even if you are in a position where you have received an offer for your property at your asking price, you may still encounter problems later in the selling process. For instance, while the buyer might be prepared to pay more than the market value for your property, the mortgage lender is unlikely to be willing to do so.
During the sales process, before a mortgage application is accepted, a mortgage lender will instruct their own surveyor to value the property. If the surveyor’s valuation is less than your asking price, the seller could be forced to pull out of the sale, unless you are willing to negotiate. But rather than being forced to negotiate with a single buyer that took several months to find, you could have been in a position where multiple buyers were found within weeks of the property being on the market, who are now trying to outbid each other.
4. The risk of distancing yourself from estate agents
That leads us nicely into another reason why you shouldn’t overvalue your property, and that’s because you risk distancing yourself from estate agents. Being an estate agent in Birmingham, we are well aware of how long the property selling process can take, as well as the obstacles that may need to be overcome, even for a realistically valued property.
If a property has been overvalued, estate agents are aware of the possibility that the sale is likely to fall through once a mortgage lender conducts their own valuation. As a result, an estate agent is likely to be unwilling to take that property on board, in the knowledge that the time they dedicate to that property is likely to be for nothing.
What’s more, a property that takes a long time to sell, or isn’t sold altogether, doesn’t do any benefits to the reputation of that estate agent. Estate agents take pride in their valuation accuracy and how quick they’re able to sell a property. An overvalued property could jeopardise that reputation as people may portion the blame for the property not selling onto the estate agent, rather than the seller.
5. You’re less likely to achieve a quick sale
By distancing yourself from established estate agents, you are less likely to achieve a quick sale for your property. This is because having a well-connected estate agent on board will give your property greater exposure as a result of the number of contacts which an estate agent has built up during their career. What’s more, estate agents will have access to several property portals to maximise engagement in your property.
By denying yourself access to an established estate agent, you also miss out on the valuable experience they have when it comes to highlighting the key aspects and potential of your property. In sum, hiring an estate agent is crucial and for more information on why that is the case, you should read our article here.
6. A Chain Reaction
Picture this. You’ve finally found your forever home and you’re ready to start a new chapter in your life. You’ve had your offer accepted, mortgage approved, and the seller is patiently waiting for you both to exchange contracts and arrange a date for completion. However, the one thing standing in your way is the current property you’re trying to sell.
The owner of the property you’re trying to buy has received several offers, and if you’re not able to sell your property soon, they’re willing to sell their property to the next highest bidder. Therefore, if you’re involved in a chain, you cannot afford to put an unrealistic price on your property when you run the risk of losing out on the one you wanted to buy.
With all of this in mind, if you would like an estate agent in Birmingham to give you a realistic valuation of your property free of charge, with no obligation to sell your property with us, look no further than Matthews Estate Agents.
You can contact us using the details below or you can visit our website here to find out more about us and what we can offer you. Tel: 0121 358 0008 (Lines open Mon - Fri 09:00 - 17:30)