The figure peaked at just over 52% in August 2009, but more recently has fallen below 30%.
Although most homes are selling for less than what they were valued at, in most cases the discount from the valuation is comparatively low. During the first half of 2011 the average selling price of a property stood at just over 96% of the valuation and 60% of sales completed had a selling price within 5% of the valuation.
David Marshall, business analyst with ESPC said: "It’s no secret that market conditions have favoured those who are in a position to buy over the last couple of years. There have consistently been more homes for sale than there are people looking to buy meaning sellers have had to work harder to attract buyers. About 15% of sellers are choosing to market their home below valuation when it first goes on the market which reflects the level of competition in the market. Additionally, when it comes time to negotiate on price the balance of power clearly favours the buyer.
"In the majority of cases the difference between the selling price and the valuation is relatively small – typically under 5% – which indicates that both buyers and sellers have a level of confidence in the valuation. Nonetheless, even when the percentage difference is low the difference between the valuation and the selling price can still be significant in cash terms and there are a number of cases where even bigger discounts are being negotiated.
"One thing we’ve definitely seen is that the longer a property spends on the market, the less chance it has of achieving its valuation. 65% of homes sold within eight weeks have achieved their valuation compared with just 24% of those which spent longer on the market. This can create problems as sellers often become attached to a valuation that may be several months old giving them unrealistic expectations of what their home is likely to sell for."
ESPC’s research also revealed that there were differences in results across different market segments with lower valued properties having a lower chance of achieving their valuation than those in higher price brackets.
Just 26% of homes valued under £100,000 achieved the valuation compared with over 45% of those valued between £300,000 and £500,000. Those valued under £100,000 achieved an average selling price equal to 95% of the valuation whilst those valued in the £300,000 to £500,000 bracket achieved an average of 99% of the valuation.
Graeme Hartley, director of The Royal Institution of Chartered Surveyors said: "It’s no surprise that many properties, especially at the lower end of the market are selling for an average 5% less than the Home Report valuation. Some potential buyers are still having problems getting a mortgage and raising a deposit. Those with finance will want a ‘bargain’ and may not be prepared to pay the full valuation. Sellers need to be realistic about the price they can achieve for their property. The valuation in a Home Report should be seen as a guide to what a property may achieve: for some it will be higher, for others it will be lower."
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