Overpricing Your Charlotte, NC. Home Can Hurt Your Eventual Sale

Going out and looking at a lot of homes over the past few months with prospective buyers in a variety of price points has led me to a few conclusions. The most striking and common I am seeing right now is overpriced listings. We all know as Realtors that the inventory of available homes has shrunk and we want every listing we can get. But is it worth it to take a listing and over price it just to have a listing? I contend that you are doing yourself and your client a disservice. Let me explain. The home is nice and attractive. It sits in a desirable area and if priced correctly should sell in a couple of months. However; you have spent money over the years updating the house and getting it ready for this day so you can either upgrade or down size. You want to take full advantage of the market and maximize your return in this market. When you interview two to three realtors for the exclusive right to list your home; they give you an idea of what your home is worth. Then we discuss the pricing in the area. We go over the comparable sales in the past few months and active homes currently on the market that is comparable to yours. Based on those numbers we give you a recommended price that your home should sell for and based on that a price you should list your home on the market for. Now one of two things is going to happen. Either one or two agents will tell you that the home is worth between $30,000 and $40,000 more than the market is currently bearing because of limited inventory and you should list with them to get the most money out of your home. Or you are going to want to get a price that maybe you paid for the house in 2006 or 2007 when the market was at it's peak. A realtor because of the limited inventory agrees to take the listing You get numerous showings because the inventory is low. But no offers. You ask your agent for feedback and they tell you it is the price. Buyer's agents like me are looking at the comparable in the area and telling their buyers that we cannot justify that price for the house and move on to one that is fairly priced for the market today. So, you agree now to lower the price to attract an offer on the house because mentally you have moved. Another 30 to 60 days pass and you are in the same position. You agree again to lower the price. However; now your home is showing to being on the market for 60 to 120 days and you have had one or two price reductions. You get an offer. Unfortunately the offer you are receiving is substantially lower than you anticipated and even lower than the one that the agent that gave you the true comparable told you they would be. And the buyer will not come up to the price you feel the house is worth an maybe not even the fair market value price of the house. Realtors and home buyers have access to houses on a variety of various websites out there. One factor that plays in for home buyers today is days on the market. The longer a home is on the market; the harder it is to sell at the number you want. Because now all of sudden home buyers are being told we are in a sellers’ market and homes are moving quickly. But your home has been on the market for 60 to 120 days...there must be something wrong with the house. So, in anticipation of finding a potential issue (that probably does not exist) the buyer needs to purchase this home for less than the market value to compensate for the days it has been on the market. No matter what you say or your realtor tells the buyer's agent; it has been on the market for an extended period of time when homes are selling. Either it is overpriced or it has issues. Either way; by pricing a home above the fair market value is going to be detrimental to the sale of your home. Perception is everything and in the day of the internet where information is readily available at our fingertips an overpriced home is going to sit and not sell as quickly as if it were priced right from the start. Because in the long run even if someone agrees to over pay for the house...it still has to appraise. no one is going to pay more than the appraised value for a house.... pricing your home right from the start with a Realtor who knows the market will in the long term get you a better return on your investment than hoping to get a number that the house is not worth. Dave diCecco Realtor/Broker Coldwell Banker United Cell:704-519-7895 ddicecco@cbunited.com www.davedicecco.com