Why do estate agents overvalue properties?

When an estate agent tells you your home is worth £450,000 and the other two agents said £395,000, it is tempting to go with the first one. That is exactly what the agent is counting on.

Overvaluing property to win an instruction is one of the most well-documented and widely practised tactics in UK estate agency. A 2023 survey found that the majority of homes listed in the UK require at least one price reduction before selling — and the average reduction is around 6%. That is not the market changing. That is the result of properties being listed at unrealistic prices in the first place.

The agent who gives you the highest number gets your signature on a sole agency agreement — usually for 8 to 16 weeks. By the time the phone stops ringing and the viewing requests dry up, you are already locked in. The suggestion to reduce the price comes a few weeks later. The agent still earns their commission when it eventually sells. You are the one who loses time, and often money, because an overpriced property develops a stigma on the portals.

A property gets the most attention in the first two weeks after it lists. Buyers who have been watching the market for months will see it immediately. If the price is right, those buyers move quickly.

If the price is too high, those same buyers scroll past. The property sits. Days on market accumulate. Buyers who do eventually see it wonder why nobody else has bought it. They offer low, or they do not offer at all.

When the price finally reduces, the pool of fresh buyers is smaller — most of them saw the original listing and already dismissed it. Research consistently shows that properties which undergo a price reduction sell for less than comparable properties that were priced correctly from the start.

The agent whose inflated valuation caused the problem is rarely held accountable. By that point, most sellers just want to get it sold.

You do not need to be an expert to catch an inflated valuation. You need a few comparables and a healthy dose of scepticism when one figure stands out from the others.

The overvaluation problem exists because of how the traditional valuation process is structured: one agent, in your home, alone, with no external check on what they tell you.

When multiple agents respond to the same property brief at the same time — as they do on ValuQ — the dynamic changes completely. Every agent knows their valuation will be compared directly against the others. There is no advantage to inflating a figure because an obviously outlying number looks suspicious, not impressive.

Agents submit the number they can actually defend, with supporting comparables, because that is what wins the instruction in a competitive environment. The seller sees three to five valuations side by side and can immediately identify where the consensus lies and where one agent is diverging from it.

This does not just protect sellers from overvaluation — it also protects against undervaluation from agents who want a quick, easy sale. Competition from both ends produces a more accurate range.

If your property has been on the market for more than three weeks with little or no serious interest, it is worth asking the question honestly.

Start by researching recent sold prices yourself — not asking prices, sold prices. What have properties of similar size, type, and condition in your immediate area actually exchanged for in the last six months? If that figure is consistently below your current asking price, you have your answer.

You can ask your agent to conduct a formal review and justify the current price with specific recent comparables. Put the request in writing. If they cannot provide comparables that support the price, ask what they recommend, and why.

If you are still within 14 days of signing your contract, you may have the right to cancel without penalty under the Consumer Contracts Regulations 2013. After that, check your agreement for the tie-in period and any early exit clauses.

In the future, getting valuations from multiple agents before choosing anyone — and comparing them side by side before committing — is the most effective protection you have.