The Dangers of Overpricing
Many potential buyers won’t even look if they think the home is out of their price range
Those buyers who do look are shopping by comparison, and looking at your home may convince them to make a bid on a different property.
If a property sits on the market for more than a few weeks it gets shop worn, causing people to think something is “wrong” with the house.
Most properties must be sold three times:
First: to the real estate agents who have the buyers. If they don’t see it as decent value, they may not show it.
Second: to the buyers. If they don’t see it as an attractive offering, they’ll look elsewhere.
Third: to the lender who will make the loan and the lender’s appraiser. If this group doesn’t see the value, the loan fails.
What it means if:
No Showings: The asking price is too far above the market. Agents don’t see your offering as worthy of showing to their buyers or the buyers aren’t interested enough to look.
Many showings, but no contracts: Agents see the home listed in the MLS and it seems to be priced right, but something precludes buyers from making an offer. Usually, the condition of the home doesn’t measure up. It is either “dated” or needs repairs, or both. The buyers don’t see enough value to even negotiate.
If the home needs work: The asking price can be brought down to the condition or the condition can be brought up to the asking price, which will almost always be the most beneficial to a seller. If the condition is incurable, i.e. the cost would be too great to make the correction, or a correction cannot be made (such as a bad lot), the only choice is to lower the price.
Overpricing lengthens marketing time, and invariably results in a lower selling price than would have been otherwise obtained.
The "Dont's" Every Seller Should Know
Don't overprice y0our home. It will cost you money!
Don’t be surprised if the first offer on your property is the best offer you receive.
Don’t let your property sit on the market too long before making a significant change in price, or it will get stale. We need to monitor daily changes in your marketplace and adjust our plan to net you the most money in the least amount of time.
Don’t look only at the price the buyer offers. Analyze the total package including buyer qualifications, contingencies, terms and closing date
Don’t forget buyers will shop around looking for the best buy. You are in competition with other sellers, so must offer the best price and condition compared to other properties.
Don’t work with more than one agent. Find one you like and stick with them. If you make a bad choice, change but stick with the new one.
Don’t forget that if real estate agents don’t see your property as a good value, they will take their buyers elsewhere.
Don’t make it difficult for agents and buyers to see your home. Buyers want to look at their convenience.
Don’t forget that you control the pricing of your home, how it looks, and the overall marketing plan. But it is the BUYERS who control value. If buyers won’t pay your price, the house remains yours.
Home Marketing Tips
WHAT AN APPRAISER CONSIDERS
The market conditions on the date of the sale
Location, location, location!
The view both looking at the property and looking from the property out
The design and appeal of the home
The quality of construction
Age of property
Condition of property
Number and types of rooms (bedrooms, bathrooms, etc.)
Square footage
Is there a basement? Is the basement finished?
What type of car storage is available? (Garage, carport, etc.)
Are there any special features that your property offers? This includes porches, patios, pool, fireplaces, special heating/cooling equipment, skylights, etc
