Selling your home should be a carefully orchestrated process, and the most important step is setting the right asking price. In fact, setting the price too high can have several unpleasant side effects, and it is often the main reason your home isn’t selling. Yet before it gets to that stage, there are several signs that you’ve priced it too high. Here’s what you need to watch out for:
You’ve Based Your Price on What You Paid
One of the easiest mistakes to make is basing your asking price on what you’ve paid for your home, plus the costs of repairs and upgrades. Yet the local market may have depreciated in recent years, and homes might sell for less than what you bought yours for. Also, the upgrades and amenities you invested in several years ago could now show signs of wear and tear.
It can be tempting to ignore comparables or pricing recommendations from professionals because you know how much your home is really worth. But if you’re unwilling to adapt your price to the current market trends, you also risk failing to meet appraisals, which can result in your buyers’ mortgage loan being rejected by the bank, and the sale not going through at all.
Your Price Is Higher than Your Neighbor’s
When pricing your home, always take a moment to check out similar listings in your neighborhood, and see how your price compares. Buyers looking to move into a neighborhood will look at several listings in the area, and if your home stands out due to the high price rather than the photos and description, that could put them off. Admittedly, if there are little or no listings, buyers looking to move in the neighborhood will have to accept your asking price, yet it’s a gamble you’re better off not taking.
You’re Going with Your Agent’s High Asking Price
While it’s easy to assume that a real estate agent will make sure your home is reasonably priced, this isn’t always the case. Some agents will suggest higher asking prices in an attempt to grow their portfolio. An agent showing your overpriced home can turn buyers’ concerns around by suggesting cheaper listings in their portfolio which, in comparison, will be more appealing.
A reputable agent will point out that your asking price is too high, instead of assuring you that they’ll be able to find buyers regardless. It’s important to screen your agents in advance, and make sure that they don’t turn your attempt to sell your home into an opportunity for another seller to close the deal.
Your Listing Has Few Views…
Most buyers will start their home shopping online, so making sure that your listing attracts as many viewers as possible is a must. However, if your listing, whether posted by you or your agent, is seeing very little traffic in spite of the attractive ad, that’s a sign the price is a significant deterrent.
… and Your Home Has No Showings
Another sign that your asking price is too high is lack of interest from buyers. Whether you’re holding an open house, or hoping that your agent will give buyers the grand tour upon request, if weeks and months go by with few or no showings, it’s time to ask yourself why. And you might find that lowering your price could generate the flow of buyers you were hoping to get.
You Keep Receiving Low Ball Offers
There’s still some chance that your home will attract buyers interested to see it in spite of the high price. However, there’s a higher chance that, once the showing is over, they will offer to buy it thousands of dollars below the asking price. Buyers are expected to negotiate the price, yet if you constantly encounter offers significantly lower than what you’re asking for, this could well be a sign that your home is overpriced.
You’ve Been on the Market Too Long
Selling your home will take time, and that’s a given. However, if your listing has been up for several months and you’ve had no offers, that’s a sign that you might have to lower your asking price. Time is not on your side as a seller, and the longer your home stays on the market, the more likely it is that buyers will start giving it a wide berth, especially if other properties in your neighborhood have already sold. Not only that, but a long time on the market can also prompt buyers to come up with low ball offers on account of your home not selling.
When you’re putting your home on the market, pricing it can make or break a sale, so make sure that you’ve set the asking price correctly.