A recent report by Gavel suggests that nine out of ten vendors have unrealistic price expectations when it comes to selling their properties. Of course, everyone wants to get as much money as possible in their sale, but when does a solid sales pitch turn into an unrealistic demand?
Do sellers have the right to charge what they want?
The research in question claimed that 92% of agents believe sellers have unrealistic sales demands. The issue with this is that it becomes difficult to sell a property valued way over the odds, but after all, as the owners, they have the right to charge whatever they want for it.
Justin Nickerson, a spokesperson for Gavel, explained: “Well they're the one holding the cards, so if they want to decide that the market doesn't match their expectations for their property, then they're inclined to do that and hang on to it.
“But I think, always, that the sellers do have an expectation that their property's worth a certain amount. I think the data that Gavel have got off the back of the survey just sort of reaffirms that, and in some cases the market might match that, and in other cases the market doesn't quite get there.”
Is there a one set price for property anymore?
In a world filled with online third-party valuation sites, it is now clearer than ever that one single property doesn’t have one set price. You can quite easily search three of these websites and find three very different prices for the same house or flat.
After all, a property is worth a different amount to different people. It’s all about what someone is willing to pay for it.
Nickerson said: “It’s the oldest cliché in real estate, but probably one of the truest. I think the hardest part about it is that emotion is the primary driver behind a property purchase, and how do you price emotion? It's an unpriceable thing. What something is worth because of a view or because of a location is different to every single person that goes through it, so to stand there and say, "Well it's got to be worth X," or, "It has to be worth Y," it just doesn't quite match up with that unpriceable element.”
How far over are properties being priced?
The Gavel research indicates that some properties are being overpriced as much as $50,000 over market value. While this doesn’t make much of a dent in a multi-million investment, an extra $50k on your standard family home can easily rack up a 20% rise.
Is the role of the estate agent to get the seller to see reality?
With every seller determined to get more money for their property, an estate agent will also have a buyer determined to pay less than the asking price. In the occasions where a seller is asking way over the odds, it can be up to the agent to get them to see sense.
Nickerson agreed: “I think the unenviable task that agents face is, on the other side of that they've got a buyer who doesn't want to pay what it's worth, either, so they're probably trying to burn the candle at both ends by getting both the seller to understand that they're expectations might be optimistic, and trying to talk to the buyer and say, ‘Look, your expectation of what you're going to buy the property for is also optimistic’.”
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