Location? Number of Bedrooms? Size of the Kitchen? Local Schools?
What exactly does drive the value of a property? And what exactly is the definition of value?
The market value is what a willing buyer would pay for the property to a willing seller, once the property was adequately exposed to the open market via the correct channels for the correct period of time (up to 3 months). This figure could vary dramatically depending upon the method(s) of marketing and how many buyers are drawn towards the property in the first place. The number of interested buyers in turn is driven by the quality of the marketing details and the asking price. The marketing details are in effect “the bait”. Poor marketing details (eg poor photographs) is like going fishing with no bait on the hook. You simply won’t catch anything.
The asking price is like a magnet for buyers. A competitive asking figure will create excitement and activity amongst potential purchasers, whereas a high asking figure will have the opposite effect and repel the most likely buyers away in the first place.
Both of these crucial elements (asking price and quality of marketing) will be driven by the choice of Estate Agent that you make. A poor agent will overprice (in order to win the instruction) and probably under market (simply because they don’t know how to use a camera). Elizabeth Davenport Estate Agents are experts in getting both of these fundamentals right and as a result have a very high success rate in selling all types of property.
Call today on 02476 010105 to speak to one of our experts about getting maximum market value for your own property.
Well, Autumn ‘s here and the leaves are falling. Thankfully house prices aren’t. Indeed, thankfully for many, they are not soaring either. Forget London’s Boom, the reality all around us, is that the reports of a Boom have heightened the expectations of sellers throughout Britain.
I had a Seller last week tell me that the agent they were marketing with in Coventry had told them that house prices had risen 10% over the height of the market in 2008. He was bullish about this too by all account. This same agent had not sold the Vendors house. It had sat on the market without viewings for 6 months. That’s because the Agent was talking nonsense. He/She just wanted an instruction to sell the house. Maybe the individual was being pressured by targets. Whomever’s fault it was it wasn’t the sellers yet they were the ones that suffered. You shouldn’t play games like this. You get found out.
Robin King a Director at “Move With Us” has just compiled a survey of over 100 Estate Agents. “Reports of a housing bubble may be pushing home owners to set unrealistic asking prices,” he said. “Putting a property on market with an accurate valuation is paramount. Our advice to home owners is not to always believe the hype and to listen to their local property expert, the estate agent”.
Good advice if you can trust your Estate Agent. If you can’t your house is going to sit on the portals and no one is going to come.
We have just compiled a list of every Estate Agents current stock and sales performance in Coventry. How much are they selling and how quickly? The results are shocking. Many of the “market leaders”, the household names, the old families and the aggressive corporates, are sitting on stocks of your houses with only very low proportions being sold. They’ve overpriced and for fear of admitting mistake they won’t approach you to discuss it. They won’t request the reduction in case you decide to venture elsewhere. They’d rather your house just sit there. With that mentality, you will too so don’t wait for that non-existent call. If you’d like to know the statistics just let us know and we’d be happy to show you. We’re not all bad..
Once again that omnipresent threat to the UK’s perception of Estate Agency is our Capital City. It drives a progressing market to the extreme and whilst the counties beyond do not rejoice in its’ ascendency they suffer when it eats itself. David Cameron, backed by Nick Clegg (what?) have suggested curbs on the second phase of the Help to Buy Scheme. However both agree with Mark Carney, the Governor of the Bank of England, that we do need to build more new homes. This cannot be denied. But if we do and the Help to Buy is restructured or even phased out then whose buying? More investors?
Undoubtedly the Bank of England’s uncertain management of the rapid increase in house prices has been fuelled by London. A 17% rise within the last year has been experienced in London with an average outside the area of 9%. Coventry has seen a equivalent growth of 4.5%. If this growth was experienced throughout the UK then no such redress of Help to Buy would surely occur. The lack of available property generates increased prices and in London, with a constant fuel of overseas investors, overpricing is clearly not a concern.
If there are more buyers than property and asking prices become “Guide Prices” then the BBC decided to scare the nation with the fact that “Estate Agents” were now charging the buyer and not the seller. I’ve seen this happen with one agent in Chelsea charging a £6000 administration fee just to place an offer with the Vendor. This sounds horrendous but don’t think that this is transferable to the Midlands because it isn’t. That’s a bus none of us would ever want to ride on.
Once again the national media have been providing commentary about the “housing bubble” and talk of measures to cool the property market down seem to be getting louder. The press however are pre-occupied with what’s happening in London and the home counties and don’t seem interested in reporting what’s happening on the ground further afield. It’s a shame that local media outlets don’t run stories about what’s happening in your own backyard or more specifically the Coventry area.
Doing some of my own research, I found it extremely easy to get the exact figures for the Coventry area, simply doing an internet search for “Land Registry Price Index” and the real data is available publicly. The contrast between the reality and what the press are reporting is amazing. Importantly the only data that matters is what houses actually sold for and this data is available through Land Registry. Price indices based upon asking prices are meaningless and misleading.
Prices in Coventry rose 4.6% annually to the end of March. This contrasts with those in prime central London which soared 17.5% during the same period. However, the most amazing statistics are where prices currently stand compared to the top of the market in early 2008. Coventry prices are still 12% lower than the at the peak (see graph). Compare this to the city of Westminster where they have risen 72% during the same period. The national figures put out on TV are heavily skewed by what’s happening in the south-east and as a result are meaningless for the rest of the country.
The market in Coventry is very healthy at present but certainly not out of control or becoming a bubble. We don’t need politicians, bankers or economists applying the brakes to our market for all of the wrong reasons.
Every House Will Sell. Put quite simply, every property has a market value and can be sold in a matter of days or weeks. This may sound incredible, especially if you have been on the market for months (or even years) but it is absolutely true.
On Saturday this week we agreed a sale on another property that had been unsuccessfully marketed for many months with another agent. It was a lovely home. Definitely a property worth more than the square footage it presented, the house was certainly a difficult one to value. Many are. If they are then the key is to not let them “sit” on the agents books. The agent can’t be allowed to forget your property and just wait for interest. That interest won’t come. Proactive agents have the ability to engage new interest and they need to be on the ball to do this. We sold the house for a price the owners were happy with and the buyers were also delighted.
If a property is stuck on the market then it is for one of three reasons. Firstly, the vendor is not motivated to sell, secondly the property has not been marketed correctly (i.e poor marketing, brochures, presentation, lack of information etc) or thirdly the property is not being advertised at the right price. There is no other reason why a home will not sell.
Bad neighbours, busy roads, railway lines through the garden, poor decoration, old fashioned kitchens, not enough bedrooms, pink bathroom suites, unfinished extensions, holes in roofs, lack of parking, too many bedrooms, no heating system, poor location……………………….. THESE ARE NOT VALID REASONS FOR A PROPERTY TO BE STUCK ON THE MARKET. They are simply factors that negatively affect the value of a property.
So if you have a property that has been stuck on sale for a long time and you think it’s not selling because of the motorway at the bottom of the garden, think again. Look at the three reasons and work through them. Your property will sell with an agent who cares.
By Mark Walmsley.
We are confident that we remain the only Estate Agent in the Region to have successfully sold an HS2 “Blighted” property to a private buyer in Burton Green. We have also successfully sold property to HS2 themselves. Our conversations with the local press, the Guardian Newspaper and the BBC led us to being the Coventry Estate Agent chosen to reflect upon the differences between our Cities property prices and those of the Big Smoke. Maybe Monaco and Milton Keynes or Singapore and Stoke on Trent could have led to similar conversations, but if the BBC asked for professional opinion, we were only too happy to offer one.
The crew were professional and there questions were all valid and sensible. However it was no surprise that so little was aired. It will remain true what Frederick Wiseman, the distinguished Documentary filmmaker of the 60’s and 70’s alluded, “If you wish to tell a lie or misguide the general public then Documentary is the medium to do so”. Suffice to say, when asked by the director how the property market in London affects activity in Coventry I might as well have countered “How does Fiona Bruce presenting the 6’0 Clock News as well as The Antiques Roadshow affect your role at the BBC?”. One does not affect the other. Edward Lorenz’ Butterfly effect is not at work here either. You could almost drop an “Eden Project” dome over the city to uppercase it’s microclimate status.
An astronomical 25% hike in Central London a nationwide housing boom does not make.
The reality in Coventry and hopefully it will continue, is that of a steady affordable rise with a variance in those suburbs more favoured by quality schooling and prestige. But all sellers must be aware that there is a “lust” factor playing it’s part in property prices too. This will create anomalies in whichever area you live. This is where the seller, the buyer and the agent can make a difference. Place the national statistics in a draw for a moment and make a sigh of relief! If you want to emulate the Big Smoke’s Housing Boom then present your property for sale with elegance and style, practicality and cleanliness and your property sale could certainly be the New York of your Neighbourhood rather than the Northampton!
By Mark Walmsley.
As 2013 draws to a close there could not be a better time to “take stock”( if you’ll pardon the pun), of the housing market in Coventry and it’s surrounding areas. Before that, 2013 has been a landmark year for Elizabeth Davenport Estate Agents. Not only have we opened our first, prominent High Street Office and employed our first non director staff, we have been consistently ranked either 1st or 2nd place for the click through rates on our website and the speed of our sales! With over 85 Estate Agents in competition with us this is something we are obviously very proud of. 2014 will see no resting on our Laurels (Christmas Pun intended) and we are investing in dramatic new sign boards that really compliment the nature of Agency and most importantly will get your property noticed first! We plan to further recruit and are constantly improving our website. We have invested further in professional photographic equipment too which is evidenced within our brochures and proven by way of our number 1 “Click Through” ranking by Rightmove. Highlights of the year for us include the dramatic amount of viewings and sale of “Whitegates”, a characterful and unique cottage residence in Keresley that had sat on the market gathering dust with other agents for over six months. We sold this within 4 weeks. “Armorial Road” is a similar success story with us having a number of offers and plentiful viewings when other agents had again failed. The sale of “Cannon Close” was another proud moment. A number of agents had valued the house and many unusual tales arose from these valuations too which quite honestly don’t depict Estate Agents well at all. Myself and the owners got on really well and the offers we received came thick and fast. It was certainly lovely to deal with a seller with such moral virtues. We had offers from investors and owner occupiers but they wanted the house to sell to family who would cherish and develop it over the years and that’s exactly what happened. The seller, as it transpired, was attracted to us by the quality of our photography which was certainly saying something as that was his profession! He kindly photographed George and I outside the house as a memento. For us it was great. For him probably a step down as he’s previously photographed Prince Charles, Mick Jagger and a host of real talent!
So what can we expect of the housing market in 2014? Firstly throw away the crystal ball and think about your own needs first. Don’t get excited or depressed by national statistics or the media’s declaration of a new housing boom with property prices increasing 6% per annum. In the West Midlands property prices are still considerably lower than they were at peak and only London and the South East are showing above inflation linked asking prices. However the “West Midlands ” statement is also not specific enough. In Coventry alone the growth in one area has been substantially greater than another with property prices literally at the end of one road remaining quite static whilst the other end see’s growth. This is why the only real monitor of worth is to the buyer. We need to put ourselves in there shoes when valuing correctly. In 2013 despite record instructions our stock levels remain low. When we price and market a property it sells very quickly. So for every new instruction a sale also occurs. This is an unlikely business model that must be retained. Why would any agent want a stock of 100’s of unsellable houses because they haven’t addressed the real reasons as to why they are not selling? If we can keep marketing to the precedent we have set then we will keep selling. We just need more, because there are buyers waiting, as my earlier examples proved. The stock level will then always remain manageable allowing us the time to productively work for you in finding your perfect buyer!
So let’s hope for New Year’s Health and Happiness and continuing the success of 2013. Thank you to all of our Customers and Christmas best wishes to all.
We will be closing for Christmas at Midday on 23rd December 2013 and opening again between 10 and 4pm on December 28th, Saturday 29th and Monday 30th December. Normal office hours will resume on Thursday 2nd January 2014.
Being an Estate Agent gives one exclusive insights into the secrets of the industry and how it works. Today I am going to risk my own safety and reveal all for the first time.
As a sales Estate Agent, one makes money from selling property. One can only sell property if one has property on one’s books to sell. So the first rule of Estate Agency is “Win The Instruction”.
With most property owners choosing their agent based upon the valuation given, the most important thing for an Estate Agent is the figure they give at the valuation. So most Estate Agents as a matter of course over-value in order to win the instruction. And because they know that the other Estate Agents attending are also going to over-value, they need to really, really over-value in order to win the instruction.
If this sounds strange to you, just think of all those properties you’ve noticed that have been on sale for months (or even years). These are products of the over-valuing trend amongst many Estate Agents.
I checked official figures yesterday and discovered that according to Rightmove, the average property at Elizabeth Davenport had been on sale for just 7 weeks. By comparison some very well known large Estate Agents in Coventry had averages of more than 30 weeks. Why? Because their properties are over-valued and over-priced.
Imagine trying to sell a £10 note for £11. What do you think would happen? Of course, people would laugh and walk away. And that is exactly what happens to over-priced properties. By comparison what do you think would happen if you put a £10 note on sale for £9? Of course, people would flock round and an auction would begin, resulting in a bidding war and probably a sale price approaching the £10 mark. In other words the only danger when pricing a property is “over-valuation” and in reality there is no danger of “under-valuation” whatsoever.
But the magic circle will never admit any of this to you and my head will probably be on a stake by tomorrow morning…………………
This week has seen the The Royal Institute of Chartered Surveyors show public caution to the seemingly dramatic rise in house prices over the last eight months. A rise of 5.4% to the end of August is revelation indeed, certainly one at odds with the reality in many parts of Coventry & Warwickshire, let alone the Country as a whole. Quite how their suggestion of how a cap could occur is not certain but surely it would be almost impossible to control? Joshua Miller, the RICS Senior Economist believes that the Bank of England have the ability to instigate such an action, one that has proved successful in Canada and other parts of the World. Anyone who knows me will know I am the least able to argue with a senior economist of anywhere, let alone the RICS, but Canada and Britain are two totally different beasts. One has a total lack of space and the other more space than they could use, need, or wish to ruin! This is really the point to address. Demographically certain areas within the country will benefit from price rises and are also able to tolerate them. How in a free economy could you tell homeowners that they could not sell to waiting cash buyers because the buyer wants to pay too much? In contrast there are more areas in the country hoping for a rise in house prices than there are who have already benefitted from them. Once again, the reality seems to sit with the Banks and Mortgage lending. If you need a mortgage to buy a house as virtually all of us do, we have to remember that it is not “our” money which allows the purchase to occur. With this in mind surely the RICS should be focusing their might upon the experienced and proven failures of the past rather than restricting potential growth across this very much imbalanced county and nation as a whole? By Mark Walmsley
Whilst the recent birth of my second child only a week or so ago has left the Dad within me contemplating nothing but cuddles, gurgles and kisses, the Estate Agent couldn’t be faulted for wondering if my children will ever be able to afford a house at all.
According to recent research those actively motivated, fully employed, first time buyers are having to save for an average of eight years to acquire the basic deposit needed to by their first property. I don’t work for the Department of National Statistics but my children having full time employment could well be triumph enough. Buying their own property could simply be the icing on the cake. 60% of first time buyers receive help from parents and grandparents and if it’s possible to do so then I would certainly like to honour this statistic. I would love to believe I’ll have the ability to pass lump sums to each allowing them to purchase their first home.
Could this be realistic though? It’s cost enough raising children whilst maintaining the ability to pay a mortgage, financing the family car and facing the inevitable breakdowns and household dilapidations that running a family require. My head began to ache (could have been lack of sleep?). Here are a few suggestions Elizabeth Davenport’s financial advisors have recommended to me.
There are many ways that a parent or grandparent can help their children with that DO NOT involve parting with their own assets. Remortgaging your own home, with the right advice, may mean that your own repayments raise but you will have released a sum to enable your children to pay for their own house rather than Mr & Mrs Landlord’s!
Even more generously minded parents or grandparents who seek to downsize themselves will find tax benefits in gifting monies to their offspring rather than allocating it as possible inheritance. This is a particularly tough conversation to instigate with Grandpa as it involves giving money and death but nonetheless it may be one that an astute Grandma could initiate instead!
Thirdly the ability for a working parent to guarantee a mortgage loan can help top up the deposit. Certainly if their own professional history and credit rating is credible this can be a very valuable tool in securing the right property rather than the compromised shed in not as bad a location as the other forty you looked at!
Finally, despite there being a raft of other options available I’ll present the ultimate. If your relationship with Mum and Dad is faultless and you truly remain the apple of your parents eye then a mortgage can be guaranteed via a charge on the parental home. This is a massive trust related gesture which is essentially a declaration that you can trust your children implicitly and they honour you enough to never default. This, of course will be my chosen path because as every new parent is certain, their children will be faultless!