A smart young estate agent valued our house recently. He simply multiplied our floor space by the average value per square foot paid recently for similar homes in our neighbourhood. This piqued me. Couldn’t he have valued Mon Repos based on the quirky originality of the décor, the accomplishments of the inhabitants and the aura of familial wellbeing emanating from the walls?

Vendors are highly prone to “loss aversion” — a fear of sacrificing value that is stronger than their desire for gains. Few anchor their expectations to inflation-adjusted prices, according to academics such as Helen Bao. If they did, the market might seize up altogether. Instead, most homeowners are reluctant to sell at any discount to the nominal price they paid to buy their property, which is always lower than that price adjusted for inflation. Researchers led by Cristian Badarinza investigated this in a 2024 Bank of England paper, finding a sharp rise in transactions just over that threshold. This suggests offering a small increment above the original nominal price may convert foot-dragging vendors into willing sellers.

The left-hand side of the plot also has a tale to tell. Resistance to selling increases steeply, rather than gradually, as the discount needed to shift a property grows. In a falling market, a proportion of vendors become “locked in” — their distress of selling below their nominal purchase price outweighs their desire to move. Transaction volumes peak just above a fair value of properties, estimated by researchers using floor space and building type. Small discounts trigger big drops in volumes.

Buyers may equally fixate on stamp duty thresholds. Some purchasers who rushed to beat the imposition of lower thresholds last year overpaid by amounts greater than the tax they avoided, experts say. While you wait, you could always stick a kitchen extension on the back of your house. When neighbour after neighbour did so, we naively assumed they were going in for informal dining in a big way. Some were. But they had a parallel motive: expanding their floorspace and subsequent valuations. Sellers are competing for buyers, rather than vice versa, so presentation matters. The reality would, at best, be amiable chaos splattered with spilled red wine and Ribena. Rightmove Neutral Chic may soon join Art Deco and Mid-Century Modernism as a historic interior design trend.