How pricing your home too high can hurt you in the long run.
Should you price your house a little higher to leave room for negotiation when you’re putting it on the market? I don’t think that’s a good idea, and I’m here to tell you why.
1. Buyers want the path of least resistance. They don’t want to deal with a seller who thinks their house is worth more than it is and have to insult you by putting in what they think is a fair market value offer. You always want to be right at market value if you want your house to sell quickly and get the most interest from buyers.
2. You want to avoid price reductions. The first 10 to 14 days that you’re on the market is the time when you’re going to get the most amount of attention because you have a new listing. If your house is priced too high and you don’t get any offers, you’ll have no choice but to consider a price reduction. The market is shifting a little bit more to a balanced level where buyers can actually negotiate now, and once they see you’ve started dropping your price, they will be more aggressive in negotiating with you because they figure if you drop the price once, you might be willing to drop it again.
3. Buyers look in brackets. If a buyer is approved for $300,000, they might look at houses from $250,000 to $300,000. If they’re approved for $350,000, they might look from $300,000 to $350,000. If you’re at $305,000, you’re not going to show up in that bracket of the $250,000 to $300,000 people. In contrast, if you price your house at $299,000, then you are the best and most attractive house in that bracket. If a buyer wants a nicer home, yours will be in comparison to smaller homes with not as many features. You’ll be the big fish in a small pond.
Those are just a few quick tips to make sure that when you’re putting your house on the market, you’re pricing it correctly from the start so that you get the most attention from the most buyers. I’m always thinking outside the box to make sure you have all the tools and tricks that you need to navigate our real estate market. If you have any questions or concerns, don’t hesitate to call or email me.