The Dangers of Overpricing Your Home
July 19, 2008
Sellers often feel there is no real harm with starting their list price high to see if they can attract a buyer and bring in top dollar. While this sounds good in theory there are some inherent risks with such a pricing strategy. Keep in mind that broker and buyer interest is at its highest when a property is first put on the market. An asking price that is beyond market range can adversely affect the marketing of a property. The following are some of the dangers involved with overpricing your home.
– Fewer buyers are attracted, and fewer offers received.
– Marketing time is prolonged, and initial marketing momentum is lost.
– The property attracts “lookers” and helps houses competing with yours look better by comparison.
– If a property does sell above true market value, it may not appraise and the buyers may not be able to secure a loan.
– It may become necessary to adjust the price below market value to compete with new, competitively priced listings. Hence, the property may eventually sell below market value.