By Archie Love
We’re fortunate that, despite the doom and gloom surrounding Brexit, the property market in much of Scotland is in rude health, with sales and confidence holding up.
Some areas will inevitably be quieter than others, often due to a range of factors, and if the response to your home going on the market is slower than you expected, the temptation is often to consider lowering the asking price.
It’s one of the most frequently asked questions we hear, and some estate agents will encourage sellers to drop the asking price in the hope of a quick commission.
Estate agents value homes based on records of similar, recently-sold properties in the same area, along with other relevant factors, and they should arrive at the highest figure they think is achievable. The same figures are used by surveyors to quantify mortgage valuations.
Of course, each house is different and there may be exceptional reasons for one property taking longer to sell than another, seemingly identical one in the same street.
However, if an estate agent habitually recommends to clients that they should drop the asking price, it’s usually a sign that they haven’t done their job properly in the first place.
Such trends are easily checked and one of the statistics I’m most proud of is that of all the properties listed on Rightmove by Scottish Property Centre Motherwell, only 4% have been reduced in value prior to sale. In contrast, of our local competitors, three have reduced valuations in more than 20% of cases.
Because our valuations are realistic, they meet and often exceed sellers’ expectations and, as a result, we routinely achieve the full home report price or more.
Properties that struggle to sell are usually wrongly priced at the outset and this can be a result of the estate agent talking-up valuations to secure a client, negotiating poorly with potential buyers or a combination of both.
If you’re locked into a contract with an estate agent who’s encouraging you to lower the asking price, you should consider several things.
Potential buyers may be attracted to your advert because of the lower price but their initial excitement may be quickly replaced by wariness and cynicism, wondering if there’s something wrong with it.
Because their renewed interest is rational – based on pounds and pence – rather than emotional – they love the property - they will be looking for all the downsides.
Buyers are generally put-off offering on a decreasing asking price. It’s like buying shares whose value is falling, they wonder if it’s reached its level or if it will continue falling.
It’s always better to ask for valuations from a range of estate agents before you put your house on the market. Don’t always go with the one who quotes the highest valuation – you may end up having to drop the price, costing you time, money and credibility.
Archie Love is a Director of Scottish Property Centre Motherwell.
For more information visit your local Scottish Property Centre or visit https://www.scottishpropertycentre.net/