Asking prices stick as 43% more homes flood market

Dear PropertyMatch
cc Anyone who gives a shizzle.


First of all - it is YOU turning this into a fracas. You have never yet - as far as I have seen - posted ANYTHING in an attempt to create a considered discussion. You simply continue to express your opinion that the blame for the state of the property market lies at the feet of Estate Agents. Then, you don't like any comment that challenges yours and start name-calling. Awwww... diddums.

1. Get my chosen name right. Your attempt at humour firstly shows you to be juvenile; secondly rude and ignorant. I am perfectly happy to engage with you, but not if you continue to show disrespect.

2. I have no leader, so there is no-one to refer. If I wish to continue to argue the toss with you, what possible purpose would this achieve anyway? Would you try to convince them that I am misguided and that YOU, and only you, know the real answers to the market? Pity - as they would certainly back ME 100%...
ANYWAYS - why spoil all the fun for the readers on EAT. This is not a private 'fracas' - you made it public so let's keep it that way. I don't intend to lose, so I don't intend to finish it behind closed doors... ;0)

3. I don't have a third - but you should never have a list of even points. I think the first two suffice.

Yours, PeeBee

• 15 July 2010 11:50 AM

c.c. Rosalind Renshaw, Editorial Director, Estate Agents Times

Dear PeeWee,
This is just turning into another fracas, whilst I wanted a considered discussion.

If you want to continue exploring these fundamentally important issues, please refer me to your leader.

They may contact me through my contacts page at Property Match (UK).
Thanks

• 15 July 2010 09:05 AM

PropertyMatch - "Forget the EA Acts, its all about what works professionally and in practice."

Hmmm... you babble on about professionalism, yet advocate ignoring the very Law that Estate Agents should obey.

You also misunderstand my points. No, I do not maintain that Agents never 'overvalue' to gain instructions - it is one of the worst 'crimes' of the industry. You will, however, NEVER get all Agents to quote from the same book. Just like you will never get all Agents to offer identical terms of business (which would be hailed as a cartel in any case...). NEITHER will you get two RICS valuers to agree to the pound on a property's worth. So, even working to rules, spreadsheets or whatever, it is down to a person's opinion on the day. Which, of course, is how a buyer buys. It is their opinion of 'value' which is primarily important. A buyer will offer under, over, or on the nose, of an asking price. If the offer is acceptable to the vendor, then we have a deal (subject to no others cocking the job at a later date, of course...).

Answer me this HONESTLY. When house prices DO start to move upwards, how will you then suggest valuers perform their job?

• 14 July 2010 16:36 PM

PeeBee: Forget the EA Acts, its all about what works professionally and in practice.

Do I understand you are saying that estate agents are never responsible to set asking prices?

In that case, why do you provide market appraisals please? That's misleading.

To advise your prospective clients correctly (and professionally) you need to give them a firm idea of what their houses are each worth.

Just agreeing with whatever they say is utterly ludicrous. Are you saying that all agents will agree to anything, just to get the instruction?

I'm saying that if all agents worked to similar valuation standards, using proper methods to calculate prices, they would all quote similar prices in their market appraisals.
We all know they do NOT do this currently, thats precisely the problem. What agents do is NOT look after their clients' best interests by failing to advise them on the correct price to ask.
Instead of getting the so-called 'best' price for the vendor, they get no price for eons, then often a massively reduced one.

My point is that the term 'best' price is in fact market value but it has been defined in too simplistic a way, and so the true meaning is being widely misinterpreted.

If all agents used market value as a basis for market appraisals, the choice of agent would depend upon other factors alone, like, enthusiasm, approach, and track record.

Your job, as an agent, is to deal with human nature, in all aspects to result in a fair and good outcome, not just act as some sort of expensive go-between.

If you still don't believe what I say, I think there is mileage in setting up a proper head-to-head discussion about how such matters should be dealt with.
I'd be up for that if were to be fairly staged.

• 14 July 2010 16:00 PM

PropertyMatch - "Your duty as an agent is to know the range of prices to market any specific property in the current market conditions, and to advise the vendor accordingly." WHAT?? Show me where in the EA 1979 it say this. An Agent's 'duty' is to get the best price for the vendor; to look after the vendors' interests. You, and all the 'discount-quick-and-get-it-off-our-shelves' merchants do not seem to understand this (or to care...). You simply add fuel to the fire that is resulting in a downward spiral. Let buyers make up their own minds how much a house is worth to them - don't bombard them with negative spin that all prices are overcooked. Vendors will, in 99 out of 100 cases, hike up the askings if they believe that they are going to be asked to take a hit. It's called human nature...

• 14 July 2010 10:43 AM

Wills, I'm afraid your argument is incorrect.

Accurate pricing to market value is the key to bring maximum market exposure and, ultimately, a satisfactory sale.
Accurate pricing has a very significant impact on the sale of a property. Properties priced within the correct 'market range' generate more viewings and thus offers. They also sell in a shorter period of time.

Market value is defined as:-
 "The price which a willing buyer will pay to a willing seller at a given point in time".

If you pitch an asking price within the market range for a specific property, a sale will result.
If you pitch the asking price outside that range, no sale will result and instead there will be abortive work, and much frustration all round, leading directly from that.

Your duty as an agent is to know the range of prices to market any specific property in the current market conditions, and to advise the vendor accordingly.
Not doing that is letting down the profession and demonstrates lack of knowledge about the property market at any given point in time.

If too high a price is asked initially, the likely result is that buys will stop being interested in that property - even if the price is subsequently reduced and falls within the correct asking price range.

You owe it to your clients to explain this to them and to guide them about the correct price for their property, at any given point in time.

• 13 July 2010 14:59 PM

Wills, there is nothing wrong in your scenario, the client is aware of the punt.

What is objectionable is weak agents blagging instructions by bulls*1&!ng their clients into believing totally unrealistic valuations just to get them on the books and kick them in the teeth later. It gives the profession a bad rep. Lying from the outset.

• 13 July 2010 09:28 AM

can someone tell me what is wrong,or unproffessional,about trying a higher price if vendors want to to start off with one?
After all if the property is in a fantastic or rarely found location what is wrong with being over optimistic with the value initially with a view to reducing or taking an offer?
After all...vendor is the client and I've no sympathy with agents who moan about overvaluing agents just because they want a quick ,hassle free ,sale.

• 12 July 2010 18:05 PM

property match fails to recognise that if houses don't sell then agents go out of business, so how can it be in the agents interest to over-inflate property prices, in most cases property prices are too high because clients can't/won't accept anything lower than they paid/re-mortgaged the property for and with interest rates at 0.5%, servicing their mortgage is cheaper than renting so they have no reason to sell at the real value resulting in low volumes of sales.

• 12 July 2010 15:10 PM

No surprise really, the economy is stuffed, lending is scarce and over priced property is failing to sell.

• 12 July 2010 13:41 PM

PropertyMatch - Rather than attempt to offer the solution to the current housing market situation, stop adding to the cause of it with your negative slant! You talk of "...unwelcome yet self-fulfilling spiral..." - yet it is entirely due to the negativity of you and others that sews the seeds of doubt in the minds of buyers and sellers in the first place. Do us all a favour - start down-hyping the cost of foreign holidays. We could all do with some cheap sun breaks - and you seem just the right man to start a price crash!

• 12 July 2010 13:15 PM

Property is selling but at realistic prices, in most cases 2005 - 2006 prices especially flats, which have been inflated by the buy to let market. Agents are still acting like they are desparate for instruction and are using the only trick they know or have been taught in the last ten years, which is over valuing to justify the fee. Too many agents and not enough properties to go around has created false market conditions.

• 12 July 2010 12:48 PM

This is a falling market yet the agents are trying to pretend otherwise.

Such a stance is doomed to fail as buyers evaporate away in response to excessive asking prices, leaving more houses unsold, than ever before.

Houses have continually been over-valued by agents in the last few years, so no surprise that prices had to fall to correct this once again, in the downturn following the banking crisis.
Unfortunately frequently falling prices makes buying houses a rather poor investment; especially if you buy before one of the falls!

Falling prices will put off more buyers, which in turn makes the prices fall further. Its an unwelcome but self-fulfilling spiral.

Such a situation is likely to happen again, and again, and again as a result of the over-optimistic pricing being sanctioned by estate agents.
Please remember, no-one forces estate agents to chalk up such prices. Blaming the clients is so weak; - as if they don't want to sell?

The cure for this problem is to put in place robust methods to make sure that agents value houses correctly.
This should be organised before the next upturn, or yet more chaos will ensue.

Not doing anything about this would be nothing short of pathetic.

• 12 July 2010 11:19 AM

Whatsthegameplan, perhaps because they'll be the only ones selling them?

• 12 July 2010 11:10 AM

Whilst vendors still maintain unrealistic aspirations - how can the best Agents survive if they are the ones that give realistic valuations?

• 12 July 2010 09:33 AM

Well done Spain.....Anyhow back to reality! These statistics really are so vague trhat they are meaningless. We have not been flooded with instructions and as far as prtices fallig....we are getting 2 to 3 full asking price offers on anything decent and end up selling at more than the asking price. Lack of stock and lack of funding is the issue. Over valuing of property has been around since the ark and will never change.

• 12 July 2010 09:29 AM