7 Deadly Sins of Overpricing
All real estate experts would agree that the best way to increase your odds of a successful sale is to price your home at fair market value. But, as logical as this advice sounds, many sellers are still tempted to tack a few percentage points onto the price to “leave room to negotiate.” To avoid this temptation, let’s take a look at the seven deadly sins of overpricing:
- Appraisal Problems. Even if you do find a buyer willing to pay an inflated price, the fact is over 90% of buyers use some kind of financing to pay for their home purchase. lf your home won’t appraise for the purchase price the sale will likely fail.
- No Showings. Today’s sophisticated home buyers are well-educated about the real estate market. lf your home is overpriced, they won’t bother looking at it- let alone make an offer. In fact statistics show that you will receive a higher percentage of your list price if sold within the first 60 days of listing your property.
- Branding Problems. When a new listing hits the market, every agent quickly checks the property out to see if ifs a good fit for their clients. lf your home is branded as “overpriced’, reigniting interest may take drastic measures.
- Selling the Competition. 0verpricing helps your competition. How? You make their lower prices seem like bargains. Nothing is worse than watching your neighbors put up a sold sign.
- Stagnation. The longer your home sits on the market the more likely it is to become stigmatized or stale. Have you ever seen a properly that seems to be perpetually for sale and wonder what’s wrong with that house?
- Tougher Negotiations. Buyers who do view your home may negotiate harder because the home has been on the market for a longer period of time and because it is overpriced compared to its competition.
- Lost 0pportunities. You will lose a percentage of buyers who are outside of your price point. These are buyers who are looking in the price range that the home will eventually sell for but don’t see the home because the price is above their present budget.
Most buyers look at 10 – 15 homes before making a buying decision. Because of this setting a competitive price relative to the competition is an essential component of a successful marketing strategy!
Our professionals have the experience and expertise to provide the proper guidance in pricing a home for sale.