Health & Fitness
What To Expect When Your Home is Overpriced...
Pricing your home to build in some 'negotiating room'? Read this first!
These days, it is not uncommon for prospective sellers to suggest listing their house at a higher price to allow for some negotiating room. In most cases, this can be a dangerous strategy because when you try to build in negotiating room, you run the risk of having to take a price reduction later in the listing period.
Through last year and the 1st quarter of 2011 the statistics are clear... if you overprice your home and are required to take a price reduction, you will likely experience a significantly longer time on market, and will ultimately achieve a lower percentage of your sale price. The slides accompanying this post illustrate the effect of price reductions on:
- The City of Decatur market in terms of median days on market (for the 1st quarter of 2011)
- The City of Decatur percentage of sales price to the NEW list price (for all of 2010).
When you take a look at the slides accompanying this article, you'll see that if the list price is off, and you are required to implement a price reduction, there is a pretty good chance your home will be on the market for a significantly longer period of time. Not only are your plans to move delayed, but you are also inconvenienced by an extended showing period and you will realize higher carrying costs as you continue to try and sell the property over the next 3 - 6 months.
Find out what's happening in Decatur-Avondale Estateswith free, real-time updates from Patch.
Further, when we look at the full year of data for the past year, you'll see that a home without a price reduction will sell at a higher percentage of its price (both the original and the NEW price) than a home that has taken a price reduction. Across all price points, the difference amounts to 1%... but when you look at Decatur's most popular price - the $300K - $499K price range - the difference is 2%.
A total of 2% may not sound like much, but at the Decatur median price point, it translates to about $6,000 to $10,000 less in the Seller's pocket. Yikes! The best strategy is to price your house competitively with the current market. You'll sell faster, and for a higher percentage of the list price. Really. You will. For more details on the City of Decatur real estate market, visit my website.
