Tuesday, August 10, 2010
Here are just a few of the disappointments you'll be facing with an overpriced house:
1. Responses to your ads will probably be slow, since the public recognizes overpricing. Remember, people buy by comparison.
2. Some prospects who are attracted may be the wrong ones. They will be attracted because they're looking for a home priced the same as yours – but with MORE features. If you are priced like the one down the street with the stainless steel appliances, granite counters, hardwood floors, jetted tub, and other upgraded features, they'll expect your home to have them too! Don't disappoint them! It's a big turn off right when they open the door and realize you don't have them.
3. Very few buyers will even make an offer on an overpriced home. The reason? Even if you accept their lower offer, they aren't getting a bargain since the final price is probably no less than "fair market value."
4. Your home will help buyers make a favorable decision on other homes that are priced fairly. Do you really want to be the example that drives people elsewhere?
5. If you do find a buyer at your price, their mortgage application could be rejected because of a low appraisal; the house simply doesn't meet the standards that the price indicates. Rebekah and I always tell our sellers that "we have to sell their house twice" - once to the buyer and second to the appraiser. An appraiser has to see the value in the contract price or it simply won't appraise.
This all sounds rather bleak, so what can you do to solve the pricing issue? Work with an experienced professional who knows the market, like us! Take advantage of the research and advice we can offer, and you'll be on your way to setting the right price for your home.