Reference and Anchor Points in Property Negotiation: What Influence Has the Estate Valuer?

Abstract

In a bid to at least satisfying individual or collective interest in property negotiations, vendors and buyers tend toplace yardsticks which inform their decision. These yardsticks have been described as the anchor and referencepoint in property negotiation. While the former affects the counteroffer a negotiator makes, the latter determineshow an offer is perceived either as a loss or gain. The aim of this work is to determine the influence of the EstateValuer in determining these yardsticks. A study of 92 Property development companies cutting across thevarious strata in the study area formed the sample size of this work. The respondents were grouped into twoequal groups of vendors and purchasers. It was revealed by the use of the Relative Important Index that record ofpast similar sales and the total cost of the subject property form the anchor and reference point for vendorsrespectively, while record of past similar purchases is both the anchor and reference point for the purchasers. Thestudy reveals that Estate Valuers have little or no influence in determining these decisive points and that at bestthey serve as Estate Agents during negotiations. The researcher opines that the regulatory bodies of The NigerianInstitution of Estate Surveyors and valuers (NIESV) and The Estate Surveyors and Valuers Registration Board ofNigeria (ESVARBON) should sponsor a research where Estate valuers in the academia can come up withcomments on daily price indices as a multiplier to the exact day to day value of real estate, thereby bringing therelevance of the Estate valuer in property negotiation to the forefront particularly when sales dates are conceded asthe date of actual transfer of interest and not the commencement of negotiation.