Gary Berendt of Arlington & Hall Estate Agents looks at the pitfalls, difficulties and intricacies associated with assessing property value.
Working as an estate agent, my fellow colleagues and property professionals will know of the conversations we often have.
Whether on a business or personal visit, when seeing people, when they hear you work in property, they are always keen to know what the value of their property is worth. No matter what it is, where you are in the country, people are always keen to know what the property market is doing, how prices are holding up, are they rising finally? Are they falling? Is now a time to buy?
Property prices are, and always have been, a national sport; a national obsession, maybe!
We are fixated with what our properties are worth, what they are selling for, what the Johnsons at number 34 sold for, but oh theirs was in worse condition than mine, and why shouldn't we be? Our properties are the single biggest investment most of us will purchase - unless you're in the business of buying limited edition hypercars or the odd Picasso to hang on your lounge wall.
Therefore, we are always keen to know the true facts, and what figure our home carries. For most people, this will directly influence their onwards move when the time comes to peruse the listings, portals and property magazines for their next home.
However, with the advent of multi-platform information sharing, comes a skewed understanding of figures.
Zoopla has its own proprietary 'online valuation tool' which, like most other agents locally, I view with frustration. Indeed, when speaking to locally visiting Zoopla reps, they apologetically explain that it's a national system that they cannot do much with. They are frustrated and do share our views that, in the local market, it simply does not work. Furthermore, it gives you, the reading public, an oft-incorrect view.
Where there are streets and streets of identical properties, this system can work well. Very well, I'm sure. It uses a mixture of data and (from what I understand) fairly complex algorithms to give a rough valuation (and, to be fair, they do say this) of what your property is worth. A
rough valuation.
Therefore, if you live in a housing estate where all the properties are of broadly similar styles, sizes and configurations, or perhaps an area of town where there are dozens of identical Victorian terraced homes, this might be a useful aid in
helping ascertain a value. The figures may be more accurate, where every single one of the last fifteen sales have been a two-bedroom semi-detached home, selling for a range of figures with perhaps only £10,000 separating the highest and lowest amounts.
However, the local market is very different. Take Sandbanks, for example. On Banks Road, we have several large beach-facing homes, with several documented sales, in the past few years, including from this firm, in the several million pounds, £4-5 million, possibly slightly more for a larger properties, with the right wind behind us. Examples on the market currently are above £6 million.
The other side of the road, we have smaller properties, purpose-built apartments.
Off the top of my head, two recent sales I personally carried out for clients were at £362,000 and £435,000 for two, two-bedroom apartments.
So on one side of the road, we have large beachfront homes with values (roughly) between £4-6m, depending on what we are looking at. The other side of the exact same road, a stone's throw away, are apartments starting at mid-to-high three-hundreds.
Therefore, in the local market, this platform - the valuation aggregator - simply doesn't work. It presents skewed figures and findings, across the area, NOT just in Sandbanks, that simply don't add up to a property's value.
I've been to plenty of valuations where, to start with, our prospective client tells us that Zoopla
valued their property at £xxx. No, we explain to them, Zoopla hasn't valued your home, they haven't seen it, they don't know what it's like, the platform is simply an aggregator, an average taking details locally. In a market such as ours, the prices don't work in that way, we have vastly different styles of home on the same road. Bournemouth Road is another, more local example - new build developments, apartments, bungalows, Victorian properties, almost every property style on offer.
The eclecticism and variety of property on offer means that a property professional is needed to ascertain selling values. These are all taken into account, they have an effect, however there are so many variables and elements involved with valuing a property which is why we are called. So many things will have an effect that it is an art and a skill that we are proud to be able to use.
The other fact, notwithstanding, is that plenty of properties simply have the wrong information on this valuation system. I entered two existing clients' properties whilst writing this; one was on Burton Road, on a very large plot. The 'valuation' came back at under £900,000, which is significantly less than what it is worth, possibly even half, and had the
wrong amount of bedrooms, bathrooms AND reception rooms! If you were looking to sell after a significant period of time, this would hugely alter your expectations and thoughts.
Similarly, the difficulty with online agents who aren't local specialists are, generally, they simply don't have the market knowledge that a local, established agent with roots and experience in your area can deliver.
We can come round, and tell you what next door sold for, or recent local sales, drawing on anecdotal evidence, other valuations, sales, purchases that clients have carried out, split fee/shared instructions, properties that came to the market and didn't sell, speculative valuations, looking at potential purchaser's homes, etc. All of this is valuable local experience and market knowledge that we, and our contemporaries, competition and local colleagues can, or should be able to, deliver. Many online agents cannot, because they will cover the whole of the UK and leave you to do all the work (including putting up your own board in some cases!).
Therefore, if you are choosing to sell, thinking about selling, or wish to glean an idea on what your home is worth, please make the right decision. Most of the time, the Zoopla 'valuation tool' (and I use that phrase very weakly) isn't worth the time invested in it, and only a reputable local agent will truly deliver a realistic selling value, not just what they think you want to hear necessarily, but a realistic price that is achievable in today's market, drawing on trends, historical evidence and similar, comparable local sales.
We have a duty under Property Ombudsman guidelines to deliver comparable evidence to valuations, and we like to do this. It shows you, the public, why your property is worth the figure we're explaining to you.
For free, independent, impartial and honest property advice, please do not hesitate to get in touch with us. We would be delighted to help and it is no-obligation. But, most pertinently of all, accurate.
