Every seller can list their house for any amount they choose. We understand that you want the best amount and may need the money to pay for the next place you will live in. However, this is not always a good strategy. If the price is too high, buyers won’t even be tempted to view or attend an open house, and your home won’t sell.
Potential buyers want a fair market value. And an exceptional real estate agent can help you provide one. With a home inspection and other assessments, listing an asking price that effectively showcases your house’s worth is the way to attract buyers. Some high-end home staging might not hurt either.
What Happens if Your Asking Price is Too High?
We’ve established that one of the dangers of overpricing your home is the absence of buyers. But there are a few other dangers that will arise.
1) Buyers Will Steer Clear of Your Listing
Good real estate agents will know right away that you have listed an overpriced home and will advise their buyers not to even consider it. Buyers without a real estate agent will also be deterred from looking at your home because they have a budget to stick to and are looking for lower prices.
You might be thinking that you added many upgrades to your home, so your home’s price is justified. Unfortunately, real estate valuation doesn’t quite work that way. Some renovations have a high return on investment while others have little to none. After all, not everyone has the same design taste, and that cute little breakfast nook you added to the kitchen a few years back might have to be demolished to make way for another owner’s new vision!
Another issue that sellers run into is thinking they can adjust their price later. This is a bad move. A house’s initial listing on the real estate market generates the most views in the first few days. After that, buyer demand wanes, which means that by overpricing your home, you’ve just missed your largest window of opportunity for viewing requests.
2) You’ve Partnered with a Bad Real Estate Agent
Sometimes, it’s all part of a plan to provide sellers with a suggested list price that is too high. Unscrupulous real estate agents use this tactic to gain unsuspecting clients, filling their heads with unrealistic dreams of huge profits. Whether taking this route is an intentional subterfuge or the result of inexperience on the realtor’s part, making a mistake like this can doom the sale right from the start. Home sellers need to be on the lookout for these types of agents and avoid falling for their less-than-stellar game plan.
Whether you had this issue and are looking for another real estate agent or are still looking around for one, it’s recommended to do some research to avoid overpricing your home. After all, buyers and agents will be looking at comparable homes in your area to see if your listing is worth viewing. Sometimes, a good real estate agent will advise you to list your home a little lower than you would like, in order to encourage a bidding war among buyers. This can result in a higher price than you might expect!
3) Your House Stays on the Market for Too Long
An overpriced home has a high chance of remaining on the market for too long, where the listing expires and hurts your chances even more. When buyers ask the real estate agent about the length of time the house has been listed, buyers won’t be drawn to your home if they hear it’s been listed for many months or re-entered the market several times.
If you don’t receive any requests for showings within the first few weeks of the house being on the real estate market, that’s a bad sign. Sellers may think that hosting an open house is the answer, but it is not. Most buyers who attend the open house will probably be neighbours who want to look at the interior. Some people may express interest, but if there aren’t any offers by the end of the day, your home has most likely not been priced properly.
On the other hand, buyers will try to negotiate with the seller because the house has been on the real estate market for a long time. This is just human nature. Some home sellers may be desperate and take the first deal that comes their way.
Time (and timing) is of the essence when selling a home, so it must have a reasonable price from the start that meets the standards of the current real estate market. If you price your home within the range of comparable sales data, your chances of many buyers seeing your listing are high.