Home Sellers: The Dangers of Overpricing
Home sellers would love to know a magic formula for calculating the proper listing price for their house. No seller wants to price their house wrong from the start, but many do. Determining the correct price requires a proper mix of research and luck.
Studies have found that houses that are priced right will sell faster and for closer to their listing price. If a house is priced too high it will take much longer to sell and fall to the lower end of the price bracket for the value of the house.
To help home sellers get their pricing right from the start, here are some tips.
Price it Right From the Start
It has been found that the most amount of attention that your house will get from potential buyers is in the first few weeks after it has been listed. The longer the house sits on the market the less interest people will have in looking at it. Even when the price is lowered, it will still not spark the same amount of interest as when it first goes up for sale.
Price Reductions
If your house has been sitting on the market for some time and you have to lower the price you might notice some additional interest. As you continue to lower the price you will eventually find a buyer that is interested. However, the longer a house sits on the market the more buyers will try to bring the price down.
Buyers assume that houses that sit on the market for a long time have something wrong with them. So, even if it was just that you priced it too high, buyers will still assume there is another reason for the home not selling and try to bring the price down even lower.
Changing Market
If your house sits on the market for too long you could risk seeing a decline in the market. That means you could list your house on the high side in a good market and then suffer later when the market declines.
You will be forced to drop your price much lower than you could have sold it at months earlier.
Getting Lazy
Keeping a house “show ready” is a lot of work for home sellers. Being ready to clean up and get your family and pets out of the house within an hour’s notice gets tiring very quickly.
Most people do not live in houses that are “showing ready” so it can be a lot of additional work to keep it in this condition. As months go on home sellers are less likely to do the extra work to get their house ready when a buyer is interested in coming to look at it.
If you want to sell your house quickly it is important that you do your part to bring a buyer in. Pricing your house at the correct spot within the appropriate price range is the key to having your house not sit on the market. There are a number of factors that could change within the months that your house sits on the market, which could result in a greater loss on the profit from your house.