Why I Think You Should List Your Million​-Pound​ ​H​ome for 99p

Obviously, I don’t.

But stay with me.

Imagine you put your car on AutoTrader. Great photographs. Lovely description. Advertised everywhere buyers are looking.

Three weeks later, nobody has called. What would you think? You wouldn’t blame the photographs. You wouldn’t decide buyers simply hadn’t appreciated how special your car was.

You’d think: I’ve got the price wrong.

Yet with houses, something strange happens. When nobody enquires, we invent every explanation imaginable before considering the obvious one. And unfortunately, some estate agents have built a business model around this.

They tell you the number you want to hear, win the instruction, tie you into a long contract and then, several disappointing weeks later, suggest reducing the price.

The problem is that overpricing doesn’t just delay your sale. It damages it.

There’s a fascinating lesson here from eBay.

Research into online auctions found that lower starting prices can attract more bidders and more bids. That increased participation can create competition and, remarkably, result in a higher final selling price.

Why? Because people compete. And competition changes behaviour. Your house isn’t an eBay auction, of course. But the psychology is remarkably similar.

I’d rather launch a property at a price that makes five serious buyers think, “I need to see that”, than at a price that makes those same five buyers think, “That’s expensive. I’ll wait.”

Because you cannot have competitive bidding without competitors.

And competition gives a seller something else that is frequently overlooked:

Choice.

The highest offer isn’t necessarily the best buyer.

Are they in a chain? How complicated is it? What’s their loan-to-value? Has their property actually sold? Is their offer likely to survive a mortgage valuation? Can they work to your timescale?

When roughly one in two agreed property sales initially falls through, these questions matter enormously. Sometimes £10,000 less from a chain-free buyer with a large deposit is considerably more attractive than the headline offer sitting on top of a house of cards.

Price matters. But so do speed, certainty and deliverability.

Which brings me to something I strongly believe. If you trust your estate agent, and they genuinely work to create and maximise buyer competition on your behalf, it is remarkably difficult to undervalue a desirable home. The danger isn’t pricing competitively. The danger is choosing an agent whose objective is to secure the quickest acceptable deal and move on.

A great agent doesn’t simply find a buyer. They create the conditions for buyers to compete.

So no, I’m not actually suggesting listing your £1 million house for 99p. But I might suggest something that feels almost as uncomfortable:

Stop asking which estate agent gives you the highest valuation.

Start asking which one has the best strategy for getting you the best result. Because your asking price isn’t your property’s value. It’s a marketing decision.

And getting that decision wrong can be very expensive.

This article originally appeared as a sponsored advertorial feature in the Autumn issue of Ealing Living Magazine.