Most people starting the process of selling their home have heard real estate agents talk about the importance of pricing. It may seem like a redundant conversation but it’s truly one of the most important factors when getting ready to list your property for sale. In my experience being realistic and pricing right usually leads to a successful sale.
These days buyers are educated about value, they have access to so much information online. Buyers are viewing 3D Matterport tours, video walkthroughs, sales data, plus they are viewing countless properties in-person before buying. If your property is over-priced, buyers & the Realtors representing them quickly determine your pricing is not inline with the current market.
So what happens when you’re over-priced? Well, showings will be less and it’s likely you won’t receive offers. All of the buyers you should be dealing with are going to be scared off by your pricing and go elsewhere. In most cases, your property will stay on the market and become what we call a, “stale listing”. Potential buyers and local Realtors start to assume there’s something fundamentally wrong with your property. Another effect of overpricing, is making other homes priced correctly seem like good value. Your home is used to legitimize pricing of other real estate. So you’re basically helping sell your competition.
From my experience as a Realtor, I so often watch the similar cycle of an owner over-pricing. The owner goes through painful price reductions and waists time, until in the end accepting market, or often below market price. Or often the frustration of selling becomes too much and the owner simply gives up on selling. This is a complex topic as it’s not always simply price which can cause a bumpy, stressful road to a sale. I say to all of our clients, price, presentation and access are three elements which need to work in harmony. I could probably talk for over an hour about this topic but hopefully you get the point.
We feel it’s important to also mention the typical results of pricing your home accurately. First of all, Realtors representing buyers, showing your home will present enthusiastically because they believe in the value. Being within the right price range for the value of your home will also garner more showings. Simply more showings, more qualified and serious buyers will view your home. Your home won’t lose marketability by sitting on the market for an extended period of time. All this translates into higher offers, selling faster and usually with better terms. Being priced correctly can often generate multiple bids which in some occasions can push pricing higher.
Over the many years of listing and selling real estate, we have come to understand why some homeowners are tempted to over-price. Probably the most common reason is expensive renovations went into the property and an owner is attempting to recover those costs. Or often sellers have a plan to purchase a more expensive property which is maxing their budget. The seller is calculating an unrealistic sale price to make the math work. Another unfortunate reason for over-pricing, is the fact they paid too much for their home to begin with. The other reason we hear often is the seller wants to leave room for negotiation.
Whatever the reason for over-pricing your home, don’t do it. Call us today for an accurate home evaluation.