When it comes time to sell your home these days, you will want to set your price correctly. To be honest, it’s more crucial than ever. Why? Even though you might want to list high to see what happens, in today’s market, that is a risky strategy that will cost you money.
Missing out on offers isn’t the only risk; it’s also missing out on the initial move you needed to make.
The Real Pitfall of Overpricing
For many homeowners, the price at which their neighbor’s house sold a few years ago is a target they wish to reach. The issue is that the market was different.
More houses are up for sale today. There are more options for buyers. They can compete without engaging in bidding wars where they offer far more than is necessary. They can now be purchased at or even less than the list price. They will also move on if you aren’t receptive to that. Lisa Sturtevant, Bright MLS’s Chief Economist, explains:
Buyers will have more leverage in many, but not all, markets. Sellers will need to adjust price expectations to reflect the transitioning market.
Here’s the good news, though. As a seller, you still have a significant advantage. The Federal Housing Finance Agency (FHFA) reports that during the past five years, home values have increased by an astounding 54%. Therefore, the chances are that you will still come out ahead even if you make a small compromise on your sale price today.
The difficulty? That’s not how most sellers think about it. They are unable to move past what a neighbor received months or years ago, which is an expensive error.
Overpricing Can Stall Your Whole Move
This is what occurs. A seller makes an excessively high listing. Customers avoid them. No offers are received. The house is sitting. And all of a sudden, that seller must make a difficult choice. Do they lower the cost? Hold it out? Or give up completely?
Regretfully, a late price reduction might not be sufficient. That is frequently interpreted by buyers as a warning sign that there is a problem with the house. Because of this, some sellers are choosing to simply remove their listing from the market.
According to a recent survey conducted by Keeping Current Matters (KCM) and John Burns Research and Consulting (JBREC), more than half of agents (54%) believe that more homes are being taken off the market than usual.
And what are the main causes of that? The agents claimed that homeowners did not receive any offers that they believed were reasonable.
The main reason why sellers are delisting their homes is because they are holding onto high price expectations.
It’s more evidence that charging too much not only drives away buyers but also jeopardizes your entire transaction. Because how are you going to sell your house if no one comes to look at it or makes an offer?
The Secret To Making Your Move Happen
You can’t afford to get stuck if you’re selling to move for work, need more room for your expanding family, or need to be near your aging relatives. The right agent is the first step in developing a pricing strategy that will help you advance.
The sellers who are currently succeeding are those who collaborate with seasoned local agents who are aware of the state of the market and aren’t hesitant to discuss prices openly.
It’s paying off, too. Homes are still selling quickly in the right price range and condition, sometimes even receiving several offers.
Conclusion
Choosing the right price for your house is crucial in the dynamic market of today. Setting your price strategically can help you draw in serious buyers faster and get a higher total return, while overpricing can drive away qualified buyers and prolong the time your house is on the market. Working with an experienced real estate agent guarantees that you price your house appropriately based on buyer demand, local data, and current economic trends, enabling you to move successfully and without needless delays.
Frequently Asked Questions
1. Why is realistic pricing so important when selling a home?
Realistic pricing helps your house sell more quickly, draws in more qualified buyers, and prevents expensive price reductions down the road.
2. What happens if I list my home too high?
Overpricing can make your property seem stale to buyers, resulting in fewer showings, fewer offers, and longer time on the market.
3. How do real estate agents determine the right price for a home?
To determine a competitive price, agents utilize a comparative market analysis (CMA), which examines local trends, recent sales, home condition, and features.
4. Can I raise my listing price later if I don’t get offers initially?
In general, starting with a fair market price is preferable. Increasing the price in the middle of the listing process may confuse buyers or make your listing less visible.
5. What’s the best strategy if multiple homes in my area are for sale?
Collaborate with your agent to strategically position your listing; you can make it stand out by highlighting your home’s main features and setting a slightly more competitive price.