‘Unrealistic’ market appraisals will lengthen transaction times - warning

Agents are being urged to avoid “too much enthusiasm” when conducting market appraisals amid warnings of a house price slowdown.

Hybrid agency brand Nested has warned that while sellers may struggle to acknowledge that their property value has declined, valuing too high will mean a tougher sales process.

With new instructions declining, competition will be high to win new business, Nested said.

But Alice Bullard, managing director of Nested has cautioned that the extent to which agents entice buyers when valuing their homes in the current market is vital.

Failure to acknowledge the changing face of the market will result in an over-exuberant valuation, the result of which is stock left to languish on the portals with little to no buyer interest, she said.

Bullard warned that valuing too high to initially win business before advising on a price reduction will also lead to a drawn-out sales process. 

Both of these factors will only slow the market further and could cause a continued decline in house prices, she added.

Bullard said: “Agents could be feeling concerned about the 2023 housing market given the doom and gloom that’s been portrayed in the media, particularly given the latest numbers from Nationwide and Halifax showing property values have now started to decline, with mortgage approvals also on the slide. 

“However, the silver lining of reducing property values is the benefit to buyers which should help maintain a consistent level of demand. 

“But agents must be sure that when looking to win business they don’t value properties with too much enthusiasm. Sellers may well expect a little wiggle room during the negotiation stage, but enticing them onto the books with unrealistic market valuations certainly won’t help sell homes.”