The list price you choose is crucial, nobody wants to lose money.
You don’t want to be the seller who turns down the first offer they get thinking it is too low, and a few weeks later wish they could get that first offer back. It’s painful to watch, but it happens often.
This logic makes sense when you think about it. When the sellers and I are sitting at their kitchen table talking about price, and we’ve examined all the market data and arrive at a probable sale price, the next step is to determine the listing price.
At this point, most sellers want to “pad” the list price to allow for negotiation. They think the buyer is going to offer lower than they want to accept, so they want to pad the price to accommodate it.
The problem with this strategy is that it can make the seller look unreasonable when compared to competing listings and cause the property to linger on the market and help the competition sell.
The first question a buyer asks after seeing a home they are considering offering on is, “how long has the house been on the market?”
The longer the home has been on the market, the stronger the evidence it is overpriced.
A buyer’s number one fear is overpaying for a home, so they tend to offer lower to avoid overpaying.
Padding the list price of your home has no bearing on the amount of the offer a seller will receive, only the length of time in which they will sell it. Read this again.
First, most buyers are represented by an agent who is working in their best interest and will do the same market analysis using the same comps we did and are likely to come up with a very similar value anyway.
Secondly, regardless of the price a buyer and seller agree upon, if there is a mortgage, the appraiser will have to support the offer amount using the same comparables.
My advice is, price it 1-3% over expected sale price, no more.
I would much rather see my seller clients decline a dozen offers because they are too low than over price the house and sit with weak showings and no offers.
Price your home reasonably and take your agent‘s advice on market adjustments. A competitively priced home will sell faster and for money in less time.
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