Despite many homeowners wanting to price their beloved homes at the highest price point possible, fair and accurately researched pricing of their homes actually works out best in the end for them.
In reality, the best way to sell a home for its highest selling price is to price it correctly from the beginning. And, with today’s generous inventory of homes, it is vital to price a home competitively for a good result.
When a house hits the market as a fresh listing, it is in the most desirable position and the competition will be the highest. Assigning a competitive price to a property reduces time on the market and actually increases the percentage of realized value.
Buyers will be eager to put in what they feel is a “fair” price. Conversely, pricing a property too high sets the stage for a series of price reductions, ultimately resulting in a lower sale price. It also steers buyers away from the home and leaves a poor first impression on the market.
As time passes, an overpriced listing starts to lose its momentum as newer, more competitive homes come up for sale, and interest in the home decreases. Fewer eyes see the listing.
Buyers and agents are constantly updated with new listings in the area, and the more time that goes by, the farther down the list the property falls. When a buyer moves on from a listing, they often forget about it altogether and it will get passed by, even when the price is lowered later.
Additionally, when a house stalls on the market, neighbors and potential buyers begin to think something is “wrong” with the property, further diminishing interest in the home.
According to Zillow, homes that sold more or less as soon as they hit the market had sale prices that were only about 1 percent below list price, while homes on the market for about two months sold at 5 percent below. And homes listed for the longest amount of time (11 months on average) fared worst, selling at 12 percent below list price.
A sense of urgency is what causes buyers to put in great offers. The shorter amount of time a home is listed, the higher the offer that can be expected. It holds true for the inverse. The more time a house is on the market, the weaker offers will be. While it may seem counter-intuitive, pricing a home competitively from the beginning can actually net a bigger profit in the long run.
Diane Farrell is a realtor with Houlihan Lawrence in Darien. A 20-year town resident, she is a board member of the Tree Conservancy of Darien. Her marketing and public relations business, Farrell Marketing and Media is based in Darien. You can reach her at firstname.lastname@example.org or (203) 984-0644.
Farrell on Real Estate:
- A Look at the Darien Rental Market: For Those Not Looking to Buy, Limited Choices: Farrell on Real Estate (May 9)
- Parks Make Darien a Nicer Place To Live and Can Help Property Values (April 26)
- First Quarter of 2018 Shows Buyers’ Market in Darien Home Sales: Farrell on Real Estate (April 19)
Darien & Rowayton Real Estate Reports:
- Darien & Rowayton Real Estate Report: May 17 to 24 (May 2)
- Darien & Rowayton Real Estate Report: May 10 to 17 (May 17)
- Darien & Rowayton Real Estate Report: May 3 to 10 ()
Darien home sales: