Price-Padders Beware: Learn about Four Ways Overpricing Your Home Can Negatively Impact the Sale
Setting a price when selling a home is one of the most difficult aspects of the process. You don’t want to set it too low and get less than you could, but you also do not want to set it to high. Why? Because it can cause serious issues. Keep reading to learn about those issues and how they can keep you from selling your home and going through the escrow process.
- If You Price Your Home Too High You Will Miss Potential Buyers
- Your Home Will Stand out for All the Wrong Reasons
- Buyers Do Not Always Want to Negotiate
- It is Likely to Take Longer to Sell
First and foremost, if you have your home priced too high then some potential buyers who may be perfect will never even see it. In today’s market when most people search for homes online, they generally include parameters on price. If you price your home out of their search then they will never even know your home exists. This is why you see many homes priced at $999,999 and not $1 million – sellers want to include the people who searched for a home under one million dollars.
Do you want your home to stand out? Yes – but not for a negative. Buyers are looking at many homes in your area. They are searching for homes with the same criteria that meet yours. As a result, they are going to be comparing your home directly to those that should be in your price range. If they can get a four-bedroom, two-bathroom home for the same price and in the same neighborhood as your two-bedroom, one-bathroom home, they are not likely to even consider yours.
One of the reasons people sometimes price their home too high is because they want the room to negotiate. This isn’t always a bad idea – but within reason. It can be uncomfortable to try and negotiate with someone when their starting price is much, much higher than it should be. If the choice comes down to yours and another home, and your home would require aggressive negotiation while they can offer almost asking price for the other one, they are likely to choose the other one.
Whether you believe “time is money” to be true all of the time, it is certainly true when it comes to selling a home. The longer it is on the market, the longer you will have to pay two mortgages or the longer you will have to wait to get into your new home. Sure, you could price it high and drop the price several times, but if it takes an extra six months to sell, would it really be worth the extra few thousand dollars?
There is no question that pricing a home can be difficult. At Neighborhood Escrow we are glad to work in a field in which our escrow fees are standard across the board and easy to understand.