The 'market' is not kind
What “Imputed Equity” Really Means — And Why Price Is Still King
In tougher markets, homeowners often cling to the idea of imputed equity — the belief that even if a property sells for less today, its “true value” hasn’t really changed. It’s a comforting thought, but it’s not how markets work.
Property is worth what a willing, qualified buyer will pay right now. Nothing more, nothing less.
Everything else is just theory.
After the post-pandemic boom, high interest rates and weaker confidence softened activity. As demand cooled, many sellers hoped prices would hold simply because past sales were higher. But markets don’t honour yesterday’s numbers. They respond to current conditions.
What Imputed Equity Actually Is
It’s the gap between what an owner thinks their property is worth and what the market is currently offering. That gap feels like “lost value,” but in reality:
- A property’s value isn’t defined by memory, emotion, or hopes.
- It’s defined by real transactions where buyers and sellers agree on price.
Price = Reality
A sale — even a lower one — is still the clearest, most reliable signal of market value. Without active sales, there’s no price discovery, no confidence, and no recovery.
Trying to hold out for yesterday’s prices only:
- Delays sales
- Widens the gap between expectation and reality
- Slows market recovery
Why the Market Always Wins
Markets move. Sometimes down, sometimes up. But they always correct.
If multiple serious buyers consistently land 10–15% below last year’s pricing, that isn’t misinformation — it’s the new reality speaking loud and clear.
Denying it doesn’t protect value. It hides it.
The Smarter Approach
The healthiest property markets — and buildings — respond to real demand, not imagined value.
- Accept qualified offers grounded in current market data
- Treat prices as information, not insults
- Recognise that transparency and turnover rebuild confidence faster than holding out
Because real value (the market kind) is created in open trade, not in theory.
Bottom Line
Imputed equity is a psychological cushion, not a financial truth.
Markets don’t deal in imagination — they deal in buyers, sellers, and actual sales.
When sellers align with current market conditions, recovery is quicker, price growth returns sooner, and everyone benefits.
If you don't need to sell - don't - property is a great investment, everybody needs to stay somewhere!
Erica Botha