Whilst carrying out property valuations we are frequently confronted with the question “why is your valuation different to Zoopla?”
To understand the answer to this, it is necessary to first understand how the two sets of figures are derived. Then you can make up your own mind about how much faith you would place in an online property valuation estimate.
The basis of the estimate displayed on websites like Zoopla is primarily data freely published by the department of land registry.
Essentially, this data includes the price a property has been sold for and some other basic information such as Tenure (Freehold or Leasehold), Property Type (Detached, Semi-Detached, etc) and an indication if the property is new.
The websites will then use this basic information to estimate what the value of the property may be now. To do this they make some assumptions about price trends and may look at other properties sold on the street or nearby in Doncaster. If any of these assumptions are wrong, the estimate is unlikely to be accurate.
If we now compare the approach of a professional Estate Agent or chartered surveyor would use to value of your property. The Royal Institute of Chartered Surveyors (RICS) expect surveyors to follow strict standards when valuing properties. These are the same standards we use to conduct our own appraisal.
Firstly, the surveyor is required to conduct a visual inspection of both the interior and exterior of the property to assess the size, condition and location of the property. Then, he or she would be required to identify a minimum of three comparable properties in the same location which have sold in the last six months. These comparable properties must be similar in size, condition and location.
Finally, experience of the local property market is essential to evaluate the impact of current demands and other local factors which can have a dramatic impact on the likely resale value of a property.
For example, local knowledge of a future development like a bypass or industrial complex close to the property can have both a positive and an adverse impact on the value. All of this information is then used, along with the many years of experience to provide a current market value.
The obvious difference between the two approaches is the amount of information available to property professional, compared to the lack of information available to websites. A good illustration of the potential pitfalls of the websites approach would be a street which may have a diverse variety of properties and plots. There are some streets in Doncaster where the prices can vary from as much as £77,000 - £640,000.
The websites just does not have enough information available to distinguish between properties such as the condition, number of bedrooms, garden size, etc. So, they have to rely on averages, which can inflate the prices dramatically of some properties and undervalue others. For example, on St Wilfrids Road in Doncaster there are a wide range of houses, with two bedroom terraced properties at one end of the street and large period detached properties with substantial gardens at the other.
According to Land Registry, the most expensive property to ever sell on this street is in excess of £640,000. However, Zoopla has an estimated value of over £1Million for one property, which last sold for £240,000. If you were the owner of this property you may think you had just hit the jackpot, but would be very disappointed. This misinformation can lead some to make financial judgments with serious consequences.
The risks of relying upon an online property estimate are quite apparent and we would always advise anyone considering selling their home to consult an experienced Estate Agent whom is based in Doncaster and has expertise of the area.
If you would like any advice on selling your home, please feel free to give us a buzz on 01302 247754.
Find out more about selling your home with The Property Hive Estate Agents Doncaster.