If you're going to sell your home, you'll need to book an estate agent for a valuation. Valuations are a huge part of the selling process, as they provide an accurate image of your property's worth, which is important for your financial planning and the purchase of your future home. Before you do this however, it's important to learn how an agent comes up with a valuation. If you learn the process, it will help you understand your property’s value in the current market.
When an estate agent values a property they take look at many factors, not just how many bedrooms you have or your local area. So what do estate agents take into account? Do estate agents just pluck a number out of the air? In this article, we're going to demystify the art of property valuation.
To value your property the estate agent will:
First things first, you need to pick an estate agent to perform the valuation. We won’t focus too much on this, as we already discuss the subject extensively here, but it’s important to note a few points of interest. Lots of estate agents offer free valuations, which can be helpful for those with tight funds. However, not all agents have good experience, which is important for an accurate valuation - so choose well!
Double-checking whether the agent has experience with your type of property
Enquiring about varying fees
Checking their percentage of asking prices achieved
We know choosing your agent can be difficult. Our free estate agent comparison tool is one of the most comprehensive and useful tools we offer, with extremely helpful data available to help you decide who to go with.
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When your estate agent arrives, they’ll take some time to explore your property. Before they begin, they'll ask some preliminary questions, like what you’re looking for from your sale, for example whether you’re looking for the highest price or the fastest sale. Don't worry, this won't change your home's actual value - but it could affect its marketing price, so it'd be wise to have an appropriate answer.
It's in your best interest to have some answers prepared for the following questions too - and also have some questions of your own.
Your estate agent will ask you the following questions when working out the value of your property:
What features make your house unique?
How old are the doors and windows?
How old is your boiler?
Is your property a leasehold? If so, how long is left on the lease? And, are there any recurring fees?
Are there any issues with the home that you’ll need to disclose to buyers, such as structural problems?
What other houses like mine are currently on the market?
How much interest are properties like mine currently getting?
Where do we need to position my home to make it stand out in the local market?
Just as important as the estate agent’s response to these questions is the evidence they use to back up their answers. If your agent is able to provide justifications for their estimate, you can be assured their valuation is likely to be more accurate. This could be examples of similar recently sold properties, or demonstrable experience of selling homes like yours.
Agents will use their local knowledge of price ceilings to generate an asking price. This is one of the biggest caps on your home's value. It would be almost impossible to sell a 3-bedroom flat for £700,000 in an area where all the other 3-bedroom flats are on sale for around £300,000. It won’t look good value for money.
It should be no surprise that your property's physical location also has a huge effect on its valuation.
To put it simply, most buyers want to live in a nice neighbourhood. Things your agent will take into account include:
Roads: How busy are they? Are they free of litter? Are they lined by trees?
Noise: Is your property located near a pub or bar?
Convenience: How close is your home to grocery shops?
Buyer demand: How much demand is there for homes in your area? How much have other properties nearby sold for?
While all of these are important, ‘buyer demand’ is probably the most defining factor for your property’s value. Estate agents will directly compare your property to recently sold properties to see whether it’s more or less attractive. They will also evaluate how quickly properties are selling - if homes are on the market for a long time with zero interest, they are most likely overpriced.
The proximity of your house to educational facilities will have a direct effect on how your estate agent evaluates your property. That's because school catchment areas are important for families, as most parents want to give their children the best education they can afford. According to a study conducted by the Department of Education, house prices near the top 10% best-performing primary schools were 8.0% higher than in the surrounding area. Near the 10% best-performing non-selective secondary schools, house prices were found to be over 6.8% higher.
Having good transport links close by is vital for a successful property market location. Agents will evaluate how good your location is by checking how convenient the closest links are. This is particularly important if your home is a type generally suited to commuters or young professionals.
How your property looks from the outside plays a factor in the agent's valuation process. The agent will generally compare your home to the other properties on your street to see if it stands out. They may make a couple of recommendations to help boost your home's market potential, especially if the paint is chipped or peeling.
As they explore your property, the estate agent will take notes of key features, including measurements of each room and the number of bedrooms. The estate agent will also consider the potential your home has for future developments, like extensions or loft conversions. They do this because they know buyers are more likely to choose properties that offer flexibility. How limited your property's potential is for future change will directly affect its appeal to buyers. The more appealing a property is to potential buyers, the higher your property’s demand will be, which will ultimately increase its value.
The estate agent will examine the general decor of your property, checking for clutter, cleanliness, and the condition of your walls. Like with earlier inspections of your home's exterior, they might make some suggestions on how you could improve the appeal of your property when the time comes to put it on the market . Rather than having a direct impact on the valuation of your house, these tips are to help you prepare your home for future viewings. Bold/poor conditions will not only wrinkle a buyer's nose, but can also impact their perception of your home's size. For example, in a study conducted by the U.S National Library of Medicine, lighter ceilings and walls were found to make a room appear higher.
Kitchens also play a big part in an estate agent's valuation, being estimated to raise the value of homes by up to 6%. They will examine the size and condition of your unit, and whether the style/age of your home is consistent with the unit.
The agent might also ask which of your white goods (things like your washing machine or fridge) you plan to take with you, and which you're willing to leave behind. If you plan to leave them behind, the design and model of these will be taken into account. While their overall impact on your valuation might be small, high-value goods are likely to sway buyers, so these products will definitely have an impact on your home's final valuation.
The agent will assess your bathroom facilities, making notes of their design and general build. One of the main things they'll take note of is how many facilities you have. Not having enough bathrooms is often a leading cause for buyers losing interest in a property. In a study conducted among real estate experts by Direct Line Home Insurance, a three-bed home would ideally have an average of 1.8 bathrooms, a four-bed would have 2.6 and a five-bed property would have 3.5.
Last but not least, the agent will inspect your outdoor area. They will take into consideration the size of your outdoor area, whether you have a garden, and its overall appeal. While your garden’s appeal is influenced by a host of factors, like whether it's a lawn or patio, agents will make particular note of its aspect. South-facing gardens are worth much more than north-facing gardens as they get more sun.
While the design and scope of your garden definitely add value to your agent's final report, the level of maintenance it requires will also influence it too. Anything that requires too much effort from the buyer could detract from your property's desirability.
Once your agent has had a good look at your home, they'll get a written valuation report together. This usually doesn't take much time and your agent will be happy to answer any additional questions you have after the valuation.
It’s recommended that you meet with more than 1 estate agent to get an accurate idea of how much your home is worth. The best practice is to have 3-4 valuations, as this range will give the best estimation of your home’s value. Not only will you be able to compare each agent’s value estimates, but you'll also be able to compare their methods. It's an opportunity to find out about their marketing ideas, their selling style, and how often they’ll be in touch with you. Your chosen estate agent will handle one of your most valuable financial assets. Taking the time to find the one best suited to you is a worthwhile investment.
If you're still in doubt about how to proceed, you can always try our free valuation tool. It compiles the latest property data to provide an excellent estimation of your home's worth.
On average an estate agent valuation takes an hour.
No, estate agents do not charge for valuations. They are typically free with no obligations.
It takes 2 minutes. 100% free. No obligation.
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