Nearly two-thirds of home sellers in England and Wales are listing their properties above market value, according to new research from The Property Buying Company.
The analysis of 3,725 transactions over the past year found that 65.6% of sellers had set asking prices higher than valuations determined through the underwriting process. Properties were typically overvalued by 4.3% on average.
The data revealed that 19% of sellers were overvaluing their homes by more than 10%, while 5.2% had set prices more than 20% above market value. Conversely, one in five homeowners were found to be undervaluing their properties, with only 14.1% achieving accurate valuations.
Regional variations
Greater London recorded the highest average overvaluation at 6.9%, followed by Warwickshire at 6.7% and Lincolnshire at 6.1%.
Karl McArdle, co-founder of The Property Buying Company, said the findings demonstrate a disconnect between homeowners’ perceptions and objective property valuations. He attributed the trend to factors including emotional attachment, investment bias and limited market knowledge.
Implications for transactions
McArdle noted that overvalued asking prices can create complications during the sales process. When properties are overvalued, mortgage lenders may decline to provide the full loan amount to buyers, potentially leading to delays in transaction completion or requiring renegotiation of the purchase price.
The findings come as the property market continues to adjust to changing economic conditions, with accurate pricing becoming increasingly important for successful sales. Industry professionals suggest that alternative sales methods may offer more transparent pricing mechanisms, though traditional valuations remain the standard approach for most transactions.
The research highlights the ongoing challenge of aligning seller expectations with market realities, a factor that can significantly impact time on market and successful completion rates across England and Wales.
