The Problem with Overpricing
We've all seen it...that moment when you click on the listing and wonder if they accidentally uploaded the wrong images - because there is NO way what's in these pictures matches the price tag. This is a very common mistake in Real Estate, the classic "let's list it for higher and we can always drop it if we need to, but it's worth a shot!".
Now I'am going to tell you why it is definitely NOT "worth a shot".
Every seller wants top dollar for their property - and rightfully so. However, the tricky thing about that is we don't get to pick and choose, the market defines what top dollar is.
Here are some (potentially disastrous) consequences that are frequently connected to over pricing:
You Miss Your Audience
Usually long before any Realtor or professional is involved most Buyers will take a look online and search for homes - the most common filter they select when searching is price range. This helps narrow down their search and stops them from wasting their time scrolling through homes they simply cannot afford. Well...if you overprice your home then you very well could end up out of sight and out of mind.
You Scare Your Audience Away
So let's just say you make it past the first mistake with some people, and they do end up seeing your listing. Well the truth is if they see yours they also have access to others, and they will quickly notice that there is no reason your 3 bedroom 2 bath bungalow is worth $80,000 more than all of the others on the market. This will lead them to believe you are unrealistic and unreasonable, two traits most people have no interest in dealing with.
What about the people that actually book showings and come to see your property? For most people purchasing a home is the biggest transaction in their lifetime, therefore they put a lot of time and effort into the process - especially the selection process. They have more than likely looked at other comparable properties and will have a few things to say when looking at yours. Something along the lines of "it's too small", "it needs work", etc. What these comments mean is that they do not see enough value to justify the price you are asking. This will lead to one of two outcomes, an offer well below list price or no offer at all.
Gives Your Audience the Upper Hand
In my experience most Real Estate Agents don't choose to overprice but it is something they are directed to do by their client. However, when over pricing a home the Realtor by default looks incompetent and inexperienced. This is something the Buyer and their agent will know, and when going into negotiations it will only work in their favor. In short, find a Realtor you trust and have confidence in their ability to properly price your home.
Homes will sell for what they are worth in the market that they are listed. So at the end of the day you want to get your property in front of as many qualified Buyers as possible. The more people that come and fall in love, the more likely you are to have a competitive advantage when selling your home - and that is exactly what you want.
If you would like more information on Selling your home reach out and I will send over an in depth Seller's Guide that has all you need to know before listing your home!