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15
STRATEGICALLYPRICING
YOURHOME
The Consequences of Overpricing at the Time
You List
The strategy of overpricing your home when you
list, knowing that you can reduce the price later,
might seem to make sense at first glance.
However, it seldom works. In fact, sellers who
overprice their homes – even just 10% above
market value – and then
reduce the price one or
more times often end up
getting less than they
would have if they had
priced it realistically from
the start, as depicted in
the Sale Price to Time-
On-Market diagram in the
middle.
HERE ISWHY:
•
Fewer buyers – even if
they are otherwise attracted to your home –
will respond to the online and offline market-
ing of it if they know it is overpriced
•
Fewer agents will show your home to their
buyers if they know it is overpriced, because
they have other houses with more attractive
prices.
•
The right buyers – i.e. looking to buy a home
like yours – may never even view it because
they will confine their search to a lesser price
range where yours should be
•
You will attract the wrong buyers – i.e. those
looking in your price range – who will not
be interested in your home, having viewed
other homes truly, worth what you are asking
for yours
•
An excessive price on your property makes
others more attractive – i.e. both those
priced where yours is, and also those priced
where yours should be
•
You will get fewer – if any – serious offers
overall because buyers may consider doing
so a waste of time
•Even if you do get a
serious offer, the exces-
sive price can lead to a
mortgage rejection for
the buyer once the lender
has a professional apprais-
al done on your home.
This leads to critical lost
time waiting for finance
approvals that never go
through
•
Reducing the price after buyers have begun
to perceive your home as a stale listing will
not generate as much interest as if you had
priced it properly from the start
THE BOTTOMLINE: REALISTIC PRICING IS
STRATEGIC PRICING!
All this is why; pricing your home realistically,
right from the beginning – to coincide with its
window of maximum market exposure so that
you can best leverage buyer interest and emo-
tions – is important, particularly in a market like
this one.
If you do so, you will not only attract more buy-
ers, you will attract the right buyers: qualified,
motivated and willing to pay top market value
for your home at the very time during the listing
when you are most likely to get it.
OVER
PRICING
The Consequences of Overpricing at the Time You List