When listing your house and trying to figure out the “magic price,” a lot of people assume they should list higher than what they’d like to get because they can just come down in price. In other words “leave some room for negotiations.” We’re diving into why that is not the best technique and can actually end up costing you more money.
When a house is priced well, it will sell quickly and close to the listing price. If you go 10- 15,000 higher than you should, your house is likely going to sit on the the market for awhile – until the price comes down. If you adjust your price after your house has been on the market for 30 days, there go 30 really precious days. Especially in a high-demand seller’s market (like we have today), buyers will look a house that has been on the market for a month or two and assume “something must be wrong with it.” That translates to less showings, less offers and (likely) a signed around offer below listing price.
Think about it this way: almost all homebuyers start their search online. If they are looking for homes between $250 and 275k, but yours is listed at $300k (when it should be $275k), those buyers (exactly who you are looking for!) aren’t going to see your home or even know it’s on the market! And someone who is looking for a house between $300k and $325k? They are going to see your house and compare it to others for $300k – quickly determining that your house for $300k isn’t quite up to par to the others. They will eliminate yours from the running. That means your home won’t appeal to that higher price range and the people who DO want your house won’t even see it.
Generally, you’ll get the most activity the first two or three weeks your on the market. Even following a price adjustment, a house will lose its interest and buzz much beyond then. Trust me, you will know if your house is priced too high.The general rule is: if you have less than 10 showings in 10 days, you’re likely too high and should talk with your agent about readjusting the price. If you have a lot of showings but no offers, your agent should be able to contact the other agents who have shown it to get some feedback.
When a house isn’t selling, it usually boils down to two things: price and the condition.