The Number One Mistake Sellers Are Making: Overpricing Their House

In the current housing market, many sellers are making a crucial error: overpricing their homes. This common mistake can cause a property to linger on the market without receiving offers. When that occurs, the homeowner may be forced to lower their asking price in an attempt to rekindle buyer interest.

Data from Realtor.com indicates that an increasing number of homeowners are recognizing this mistake and opting for price reductions (see the graph below):

 

If you’re considering selling your home, it’s essential to understand this: the best way to avoid a costly mistake is to collaborate with a trusted real estate agent to determine the right price. Here’s what could be at risk if you don’t.

Not Paying Attention To Current Market Conditions

Accurately pricing your home requires a clear understanding of current market conditions. Setting your asking price based on pandemic-era trends is not advisable, as the market has since stabilized. It’s much wiser to align your price with today’s reality.

Real estate agents are well-informed on market trends and how they influence the pricing strategy for your home.

Pricing It Based on What You Want To Make (Not What It’s Worth)

Another common mistake is setting your price based on what you hope to make from the sale, rather than the current market value. You might see other homes in your neighborhood selling for a high price and assume yours will too. However, you may overlook factors like differences in size, condition, and features. For instance, the other home might be waterfront or have a finished basement. In short, Bankrate explains:

“How do you find that sweet spot of pricing for profit but not overpricing? The expertise of your agent can be truly valuable here. A knowledgeable agent will understand fair market value in your area, how much your house is worth and how much you might reasonably expect to get for it in the current market.”

An agent will conduct a comparative market analysis (CMA) to ensure your home is accurately compared with similar properties, helping to determine the most appropriate price.

Pricing High to Leave Room for Negotiation

Another common but flawed strategy is intentionally pricing your home high to allow room for negotiation. However, this approach can backfire. An excessively high price often discourages potential buyers from even looking at your property. Instead of creating space for negotiation, you may end up driving buyers away. U.S. News Real Estate explains:

“You want to sell your house for top dollar, but be realistic about the value of the property and how buyers will see it. If you’ve overpriced your home, chances are you’ll eventually need to lower the number, but the peak period of activity that a new listing experiences is already gone.”

An agent can assist you in setting a fair price that attracts buyers and encourages competitive offers.

Bottom Line

Overpricing your home can lead to significant consequences. A skilled real estate agent provides an objective viewpoint, extensive market knowledge, and a strategic approach to pricing. 

Let’s connect to ensure you avoid a costly pricing mistake.