When Your Selling Price is too High, Beware!
So you’ve decided to and have a fairly good idea of what you think it is worth. Being a sensible home seller, you schedule appointments with three listing agents from reputable real estate companies. Each comes prepared with a "Competitive Market Analysis" on fancy paper and they each recommend a specific sales price.
Amazingly, a couple of the Realtors have come up with prices that are lower than you expected. Although they back up their recommendations with recent sales data of similar homes, you remain convinced your house is worth more.
If you’re like many people, you pick Realtor number three. This is an agent who seems willing to listen to your input and work with you. This is an agent that cares about putting the most money in your pocket. This is an agent that is willing to start out at your price and if you need to drop the price later, you can do that easily, right?
The truth is that you may have just met an agent engaging in a questionable sales practice called "buying a listing." He "bought" the listing by suggesting you might be able to get a higher sales price than the other agents recommended. Most likely, he is quite doubtful that your home will actually sell at that price. The intention from the beginning is to eventually talk you into lowering the price. Why do some agents "buy" listings this way? There are basically two reasons. A well-meaning and hard working agent can feel pressure from a homeowner who has an inflated perception of his home’s value. On the other hand, there are some agents who engage in this sales practice routinely
If you start out with too high a price on your home, you may have just added to your stress level -- and is stressful enough. There will be a lot of "behind the scenes" action taking place that you don’t know about.
Contrary to popular opinion, the listing/marketing agent does not usually attempt to sell your home only to s but also to other agents. Listing/marketing agents market and promote your home to the hordes of other local agents who work with homebuyers, dramatically increasing your personal sales force. During the first two or three weeks your home should be a flurry of activity with agents coming to show your home if the price is right. If you and your agent have overpriced, fewer agents will show your home. If your house is dramatically above market, why waste time? Their time is better spent showing homes that are priced realistically.
So what will happen if you overprice your home?
That’s because they were victims of an agent that ’bought their listing’. If you want your home sold, especially in today’s challenging market you have to price it right to begin with. Currently an average agent sells 16% of his/her listings which means that 84% of agents price their listings wrong and engage in ‘buying their listings’ in this challenging price sensitive market!