Setting your home’s selling price above its actual market value may seem like a great idea…right?
You have room to deal with buyers who like to bargain aggressively. Plus, your agent can comfortably take his or her commission without compromising what you’ll receive from the sale. Sounds like a win-win situation, right?
Well, there’s a little more to it than that. Let’s look a little deeper at the home selling process to better understand why this is not such a great idea.
A well-maintained property, that is priced competitively from the get-go is actually more likely to sell within the higher end of its value range than one that starts out too high. The better priced home will also sell quicker. This sounds counter-intuitive because it seems we are all taught to go high so we have room to negotiate down. Here’s a better strategy … price it right and don’t negotiate down.
Most homeowners may know their home inside and out…but may not have a great idea of how their home compares to other similar homes. A good Realtor looks at dozens of properties a week and has the very best home valuation tools. They are “in” the market day in and day out and really are the best resource for someone looking to price their home correctly. Homeowners may actually over-value their home…just because it’s their home.
There is a common misconception that real estate agents routinely under-price homes to get a quick sale…to pad their statistics or something. A quick sale doesn’t necessarily mean the home was under-priced. Given enough market exposure, a slightly underpriced home quite often generates multiple offers and actually results in a final price above list price in many cases. Most good agents truly are more concerned with making sure that your house is accurately priced according to current market conditions.
Potential buyers usually respond to a listing within a couple of weeks of listing, so making it attractive right from the start (especially when it comes to pricing) increases your chances of having a favorable sale.
As the popular saying goes, “First impressions, last.” The same rings true for your house listing.
Take advantage of early momentum when you first put up your house for sale. When we have an overpriced listing that doesn’t get any traffic for several weeks it usually ends up with a price reduction after 21-30 days. If there’s no showings after 3 weeks, that’s the market speaking to us…it’s saying “you are over-priced.”
About the author: The above post “Why Overpricing Your House Is Always a Bad Idea” was provided by Kevin Guerrero of Keller Williams Clients’ Choice Realty. To find out more about Kevin and Keller Williams check out the ABOUT US page.
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