Property Price Versus Property Value: Are You Paying for What It Is Worth?

He told me the house was worth more than the seller was asking.

He said it with the confidence of someone who had already done the calculation. The location was good, the finishing was beautiful, and another house nearby had sold for more. He was ready to make an offer.

I asked him one question.

Sold for how much?

He returned to the listing.

There is a difference between a property being advertised at a price and a buyer actually agreeing to pay it. The first tells you what the seller wants. The second gives you evidence of what the market may accept.

Even then, one sale does not settle the matter.

The asking price

A seller can ask ₦300 million for a house. That number may reflect what they paid for the land, the cost of construction, money spent on finishing, an agent’s advice, or simply what they hope to receive.

This is where buyers get into trouble. They see a discount from the asking price and assume they have found value. But a house listed at ₦300 million and negotiated down to ₦270 million is not necessarily a bargain. If comparable properties are selling for ₦230 million, the discount may only make an overpriced house slightly less overpriced.

A reduction is not proof of value.

What the market is telling you

To assess value, look beyond the listing. Compare genuinely similar properties in the same location, considering land size, condition, layout, access, title, finishing and the state of the surrounding area.

Two houses can share a neighbourhood and still differ in access, title, condition and demand. Those differences belong in the comparison.

And remember that asking prices are not completed transactions. Where reliable sale evidence is limited, your estimate should reflect that uncertainty rather than pretend it does not exist.

What are you buying?

A property can be worth ₦250 million to one buyer and less to another. Someone who needs to move quickly may pay for convenience. Someone buying for rental income will calculate expected rent, expenses, vacancy and the return left after costs. A buyer planning to resell will care about the depth of future demand.

Their needs differ. So does the value they can reasonably justify.

This is why I would not call a property a good investment simply because its price is below another property’s asking price. I want to know what supports the number, what income or use the property can provide, and who might want it when I am ready to leave.

The most expensive mistake is not always paying too much. Sometimes it is accepting somebody else’s valuation without asking what it is based on.

A seller is entitled to their price. You are responsible for your decision.

Before making an offer, ask what evidence supports the asking price, which comparable sales are genuinely relevant, and whether the property still makes sense at that figure after considering your costs and exit.

The market may not agree.

Written by Joy O. Amadasun

Founder & Head Broker · Held Olive Realty Ltd. · Abuja Real Estate

MARGIN is Joy Amadasun’s personal editorial journal on real estate, life and everything in between.