The busy spring market is quickly approaching and some of you may be sellers preparing to put your home on the market. One of the most important decisions you will have to make is deciding on the asking price. Should you choose to “push the market,” your home could end up sitting for months, resulting in the selling process costing you more than you anticipate. US Mortgage has come up with some pitfalls to avoid when listing your home.
Time on the market – Overpriced homes could potentially sit on the market for months and essentially become “stale listings.” Buyers then begin to question this property: “Why has this been on the market for so long?” “Is there something wrong with the listing?” “Is there something that I don’t know or am missing about this home?” These questions will stick in the buyers’ minds and could lead them to walk away from the property or lowball their offers. Neither of these scenarios benefits the seller.
“Price High, Reduce Later” - Be careful when thinking that you can always reduce the price at a later date. Once you put your home on the market, the greatest potential for traffic is in the first 30-45 days. By pricing high with the intention of dropping the price later, you risk losing a lot of potential buyers.
Lower Proceeds – Unfortunately, when a home is overpriced when initially listed, it almost always is guaranteed to sell for less than market value. What ends up happening is the seller has fewer buyers to choose from, zero control because of the time spent on the market, too high an asking price, and costs to incur to maintain the property. Because of all of these negative circumstances, the seller will get the least from their investment rather than the most.
Helping your Competition – Why would you want to make your neighbor’s property look like a better deal than yours? An overpriced home can actually help your competitors, so it is imperative to scan the neighboring inventory before listing your home. If you are pricing higher than what is available around the block, make sure that your property offers assets that justify this increase.
Remember, making the choice to overprice your listing can prove to be a timely and costly risk for the seller.
SOURCED: Epoch Times