An article recently published in Which? magazine will not be filed under consumer protection/information but most certainly does qualify for the ‘Well that was a waste of ink/Quiet day for news’ category. Incidentally, I was intrigued to learn that Which? is actually the brand name used by the Consumers’ Association, which itself is a registered charity (eh?) The article in question penned -if that is the correct terminology to use for someone whose job title is ‘data journalist’-(the purists among you may deem that to be something of an oxymoron), by a Tom Calver, concerned ole faithful, the overvaluing of property by estate agents. Tom highlights a property that was listed in 2011 where the valuations ranged from £480,000 to £650, 000 Which? magazine 15 February 2107 Tom writes that “naturally” the vendors opted for the agent with the higher listing price. Mmmm. What exactly is ‘natural’ about that? Bearing in mind that Which? in all its forms is there to promote informed consumer choice, did it not ring any sort of alarm bell that there was such a differentiation in price, but obviously the highest price was correct? The most ‘natural’ part of the arrangement would seem to be the appearance of one of the seven deadly sins-greed. Hey ho. Back to Thomas. He does say that the vendors, “queried” the valuation with the agent, but they still went with it. Er, why? Tom recounts with pursed lips and furrowed brow (the default expression for those championing consumer rights, or independence for Scotland; but that is for another day), that the property took a staggering four years to sell for an eventual £482,000. During this time, the vendors changed agents twice and reduced the price “several times”. May I respectfully suggest that a. they needed to change agents only once and similarly reduce the value on one sole occasion and b. that wasn’t the best example to use Tom.
Further on in the article it is stated that nearly one in five properties (that would be close to 20% then), have to be reduced by 5% or more in order to sell. Would that mean then that over 80% of properties do not have to be reduced to sell? Not a bad strike rate. The gist of the piece is that it is all the fault of estate agents that properties are overvalued and subsequently reduced to sell. OK. We have blogged many times on the more than dubious antics of our competitors who frequently, (often under direction from people on much bigger salaries than they) overvalue a property in order to obtain the listing. The contract is then signed and goodness gracious, within a fortnight-with no viewings-the vendor is being told that in order to sell they should drop the price. We all know that this happens, but what Thomas omits from his article is that events dear boy (name the Prime Minister who said that) can result in a price reduction being necessary. One of the most common reasons is that after the valuation/survey a renegotiation on the price take place due to galloping beetle rot in the floor boards or the pasture of Japanese knot weed in the rear garden. Some surveyors have been known to down value a property because… they can. Even if three separate competing agents have all valued it at a similar price. There is also one real driver that Thomas failed to mention; on many occasions, the vendor insists on a certain price before marketing can commence even if it is nowhere near the valuation given by the agent(s). If this is the case, it is backing without the favourite time that the subsequent price reduction will all be the fault of the agent.
I did chuckle when Thomas-with an evermore pursed lip and furrowed brow-wrote that inflated prices meant that vendors had lost their “dream home’ because the property that they were selling had been overvalued. Right. My dream home is a beach-front, 27 room villa with its own cinema and a hot tub on the roof, adorned with Eastern European ladies in various states of undress… but I am not going to kid myself that the reason that I am unable to sign the paperwork is because I haven’t managed to sell Cheshire Towers in Cwmbran. Forgive me Thomas, but FFS.
This may come as a surprise and perhaps Which? in its role as a public service provider may need to be more eager to promote, but estate agency is not an exact science and the value of a property is what one person is prepared to pay for it. That’s it. Estate agents are the whipping boys (and girls for all the Germaine Greers out there). If a house sells too quickly (forget the effort put in to market it to maximum effect), the agent undervalued it. If is takes too long to sell, the agent overvalued it (not withstanding the toe-curling, migraine-inducing decor and pet graveyard in the garden). We now have an influx of online agents who charge a fee for merely listing a property, never mind actually selling it. What incentive is there for such agents to value, not just accurately, but fairly? Perhaps Tom and his cohorts at Which?-as per their remit of informing the consumer-should write an article on this?