Changing the Estate Agents Act to allow ‘passive intermediaries’ to operate outside the scope of the legislation has thrown the spotlight on valuations.
Just how will private sellers going through ‘passive intermediaries’ put a value on their properties?
The traditional answer would have been to get three agents round to value it and pick the highest valuation (or possibly the middle one).
However, today’s answer is far more likely to be to use one of the several online property valuation tools available (including, it must be said, the Calnea product that the publishers of EAT, Angels Media, is currently marketing as a tool that can be white-labelled to go on agents' own websites).
But what are agents’ experiences of these? We would be very interested to know.
Feedback so far suggests they can be unreliable, and certainly varying.
One person, dealing with a probate property, is up against the beneficiaries querying agents’ valuations being about 30% lower than the valuation they got through online valuation tools. Two agents have given identical valuations of £180,000, but Zoopla comes up with a suggested worth of £248,000
Nor is Zoopla’s valuation tool the only one raising eyebrows. We have heard of a seaside holiday chalet sold (The Dunes EX33 1PR) for £150,000 last November. The Calnea valuation suggests it is worth £506,900, while FindaProperty puts it at £282,500 and Zoopla at £154,000.
Another Exeter property (No 28 EX31 2ER) sold also last November for £166,000. Zoopla put its current value at £175,000, Calnea at £208,000 and FindaProperty at £189,000.
As posters to earlier stories on EAT about property pricing and the change to the Estate Agents Act have said, one complication of valuation tools is that they cannot see the state of the property ‘on the ground’. They cannot detect whether a house has an avocado bathroom suite, or the latest in electronic wizardry and walk-in showers.
What are estate agents’ experiences of these valuations tools, and which one, if any, comes out best? Do you believe they potentially mislead the public? Have you, as an agent, come across cases where vendors know the ‘price’ that, for example, Zoopla gives and refuse to accept your own valuation?
In the light of the impending change to legislation, are agents rethinking the notion of providing free advice on value?
Do please post your thoughts below. It is an important subject for several reasons.
For one thing, Calnea is the official number cruncher for the Land Registry.
For another, sales of probate properties could be badly held up if beneficiaries of estates refuse to accept lower valuations than they can find online.
Thirdly, just why are these online valuation tools so wildly varying in their results, when they apparently use science?
But mainly this is important because it could cast possible doubt on the business model of new entrants to estate agency that the Government is – despite so many warnings about consumer protection – so keen to encourage.