Crucial for sellers
The Propstats' figures for the majority of Cape Peninsula suburbs conclude that many home sellers, despite ongoing warnings from the leading estate agencies on this subject, are still overvaluing their homes.
Taking as an example the Hout Bay/Llandudno area in which Anne Porter Knigh Frank is particularly active, Managing Director Lanice Steward, said that in the last three years prices have remained more or less static - the current average price for Hout Bay being ± R2,760,000. However, she said, the average time taken to sell a home increased in that three year period from 128 days (in 2009) to 155 days (in 2011).
"This indicates that some sellers," said Steward, "are still not accepting that price increases are no longer the norm and that realistic prices are now at roughly 2007 levels."
It is this, not a lack of demand, she said, that is the main reason for properties staying on the market for such long periods.
Although APKF agents are forbidden by the company's code of ethics from overvaluing, some agents in Hout Bay, said Steward, are still doing this to obtain mandates.
Sellers interviewing agents on the hunt for sole mandates, said Steward, should insist that the agent justifies his valuation by producing figures of recent sales of similar properties in the area. They should also be asked to reveal the differences between asking and achieved prices on their last half dozen sales. If these are over the area average, there is, she said, very definitely room for suspicion. Similarly, if the times taken to sell homes are above average, that too is an indicator not only of incompetence but also possibly of the methods they have used to obtain to mandates.
If an agent cannot produce such figures, added Steward, that in itself is a sure indication that he or she lacks professionalism.
"Those who do succumb to the overvaluing syndrome," said Steward, "will in nine cases out of ten find their selling experience traumatic. It is never pleasant to have curious strangers traipsing through your home and garden and if this goes on for months on end it can reduce sellers to a state of despair. Sellers must take the bull by the horns, obtain realistic valuations and not be fooled by mandate hungry agents prepared to compromise their integrity in order to get mandates."