A new study by property website Zillow.com shows that many home sellers are
unrealistically optimistic, asking considerably more than they're likely to get.
As a result, they risk long delays in finding buyers, which means a lot of lost
revenue while the house sits idle on the market.
What's more, homeowners who bought after the housing bubble peaked in 2007
were even more unrealistic than those who bought before or during the bubble,
perhaps because post-bubble buyers thought they got better bargains than they
actually did.
"We found sellers who bought after the housing bubble burst, in 2007 or
later, price their homes 14% above market value," said Zillow, which used sales
of comparable homes to figure market value. "Those who bought before the housing
run-up, prior to 2002, overprice by nearly 12%. Somewhat surprisingly, sellers
who bought during the run-up, from 2002-2006, seem to be the most realistic,
pricing their homes 9% over market value."
Market value is a tricky number, because comparable-sales data do not always
provide a good guide to a home's value. Nearby homes that have sold in the past
six months or so may be quite different from yours in appearance or condition,
and there may be too few recent sales to get a proper valuation. That being
said, you won't have much chance of getting a premium price on a cookie-cutter
condo if identical units have sold for less.
As a seller, you have a right to ask for whatever price you want, which you
can drop if no one bites. You may get lucky, but asking too much involves a
number of risks, even if you're just "testing the market" for a few weeks or
month
Pricing your home too high not only won't get your house sold but works against you in some
important ways. Here are three of them:
1. Agents react. Real-estate agents — yours and the buyers'
— may not want to waste time with a home that's unlikely to sell. Though a
higher price means a bigger commission, agents might figure they can move two or
three homes in the time it would take to sell yours, earning more even if each
offers a smaller commission than your property does.
2. Buyers react. Buyers who like your house but pass on your
property because of the price may find something else and close a deal before
you drop your asking price to a level they'd accept.
3. You need that money. Even if you get your full asking
price, the time it takes to get it may cause you to miss out on the house you
want to buy. You may have to settle for something that's not as suitable. Even
worse, you may end up spending more than you had planned, offsetting the premium
you got on your sale.
Setting a proper sale price from the beginning is important. It is a good idea to hire a Real Estate Agent who is familiar with your area and knows the market of homes that are currently for sale and have recently sold.
Have the agent show you "comparable" homes used to set your asking price, Make sure the house's curb
appeal matches yours. Homes for sale today need to be staged to sell. Buyers need to have that "wow" factor from the minute they drive up to the house.
Finally, keep an eye on the "traffic" - the number of potential buyers who
come through your property. A good agent will have a sense of how many buyers
are looking. If you are not getting your share, it's a sign you are reaching on
price. If dropping your price is inevitable, it's better to do it sooner than
later.
Looking to sell or buy a home in Weddington, Waxhaw, Marvin area? I would love to meet with you and discuss how I can market your house or show you wonderful homes for sale in Union County and South Charlotte.