The oldest trick in the book – used by some (less reputable) estate agents
From time to time all estate agents find themselves uncomfortably short of properties to sell. And when ‘stock famine’ strikes the pressure to secure new business can make it tempting to reel in prospective clients – homeowners who are planning to sell – by all means possible. Probably the most effective way of doing this is by dispensing mind-bendingly over-optimistic valuations. Sometimes agents’ sales letters incorporating valuations are dressed up to sound more professional by calling them ‘appraisals’, normally the preserve of qualified chartered surveyor valuers.
Getting property onto the agent’s books is of course the prime objective. Getting it sold can be worried about later, even if it means having to slash an overly optimistic asking price down to the value an honest agent would have put on it in the first place.
As a vendor this does you no favours at all. This is because it could well have ‘priced you out of the market’, causing you to miss perfectly good buyers. At the end of the day, it’s important to remember that estate agents are sales people, and as a potential customer you will be squarely lined up in their sights. By putting a value on your home that far exceeds your expectations, the hope is that you will be suitably impressed by their confidence and appoint them over their competitors.
In truth we are all susceptible to a spot of flattery, and agents make full use of this. Having lavishly complemented your taste in decor and raved enthusiastically about your charming home, you will be left in no doubt that there are dozens of eager buyers queuing up desperate to make offers, and that your property will be snapped up. In a strong market this may indeed happen.
But more often, after a number of fruitless viewings the agent provides ‘feedback’ telling you all the negatives about your property that somehow they hadn’t noticed earlier. This is the process of ‘managing your expectations downwards’.
Agents sometimes like to suggest that one of the advantages of appointing them is that you’ll recoup the cost because they will skilfully ‘negotiate’ a higher selling price. In reality, securing their commission is usually more important than getting the best price for the client. When push comes to shove, ‘negotiating skills’ may actually be employed to persuade you, the seller, to drop the price.
So before making the final decision, test your agent. Ask them how many sales they have made in the last 3 months, and how many visitors they get on their website.
Another deception, occasionally employed by small provincial agents outside London, is to have a second branch nominally based in Mayfair, London WC1. As all keen Monopoly players will know, this is prime real estate – which estate agents like to shout about, splashing their Mayfair address prominently across websites and marketing material. Their Sales Negotiators will be keen to stress their firm’s ability to attract cash-rich London business people looking to buy ‘out of town’. But in reality this Mayfair ‘office’ may be nothing more than a shared mailing address.
Our next blog – coming soon ……
What are the most effective Estate Agent marketing tools?
Check out our Rightsurvey blog page for more industry tips and secrets written by property professionals to help put you in control.