5 Problems with Overpricing your Home (and 3 Ways to Avoid Them)

Overpricing a home is one of the worst mistakes a seller can make.

If you fall into this trap, you’re going to end up waiting a long time for your home to sell—if it ever does.

So, before putting your home on the Market, do some research!

There are plenty of misconceptions that lead sellers to overprice.

The unfortunate truth is that the price tag on your home can make or break the success of the transaction.

So take time and consider everything you need to do to prepare your home to sell.

Then, make an informed decision about how you should price your home.

There are a myriad of problems associated with overpricing.

We’ll cover 6 of the biggest ones here.

But, in an effort to empower people as much as possible, we’ll touch on a few things to help you avoid this issue in the first place.

In fact, let’s start with 3 simple ways you can reduce your chance of overpricing your home.

3 Ways to Avoid Overpricing Your Home

Hire an Experienced Realtor

There is no one better than a true Real Estate professional, who is familiar with the properties and trends in your area, to help you price your home.

A Realtor’s reputation and credibility is everything.

This is why we compete so hard to provide honest information that will help our clients achieve their selling goals.

Don’t Trust Zillow

Sellers who choose to sell independently often make the mistake of trusting Internet Real Estate Platforms, such as Zillow, to estimate home values accurately.

These platforms do contain some useful tools, even for agents to use.

But if you get caught up pricing your home based on their estimates, you’re very likely to price your home incorrectly.

Don’t be an emotional seller

It’s not about what the home is worth to you.

As brutal as it sounds, selling a home comes down to numbers.

And you have to make sure those numbers make sense.

Whether the upgrades you’ve made to your home didn’t result in the type of equity you intended or if local development has downgraded your property value, do not fall into this mistake.

Holding out for more won’t bring it to you.

5 Major Problems with Overpricing your Home

It’s unfortunate how few buyers realize just how potentially detrimental introducing their home at a price too high can be. Some of the issues might seem obvious.

But others are more subtle.

All are things you want to avoid.

Here’s our top 5 problems overpricing your home can cause you.

It Scares Off Buyers

Far too often, sellers without a knowledgeable real estate agent price their home too high on the notion that leaving a reasonable amount of bargaining room will allow for higher offers.

In reality, many buyers are afraid of “low balling” because they do not want to offend the seller.

It is important to have your home priced right the first time.

Buyers and their agents will look at property values in the surrounding area, and an overpriced home always sets off red flags. Most people want a deal.

Positioning your home out of reach will drive off all of those people.

It Stays on the Market Too Long

Time is your enemy when you’re selling a home.

Period.

Even if you’re in no rush to sell, you should know that every day that your home sits on the market, the market works against you.

Total time on the market plays a big part in the kind of offers and potential buyers your home will attract.

When you first introduce your home to the market, it should be appealing to a broad number of buyers.

It should also be listed at a price similar, or better, than comparable homes in your area.

Overpriced homes take significantly longer to sell and often cause the listing to expire.

Expired listings are rarely good for sellers.

It Shifts Buyer’s Perception

It is important to position your home as a desirable product.

There is a stigma attached to listings that have gone “stale.”

Buyers perceive “stale” listings as having something wrong with them.

And worse yet, expired listings are perceived to be “desperate.”

Most buyers ask how long a home has been on the market for one reason, and one reason only:

Buyers feel that the longer a home has been on the market, the more willing the seller will be to bargain.

Very often, they are correct in that assumption. Price aggressively from the start to compete with the homes around you.

If you try and chase the market, the only homes you’ll help sell are the ones around you.

It Helps Sell Other Area Homes

This is easily the most depressing side­effect of an overpriced listing.

When buyers see an overpriced home, they usually skip over to the next house, or put it into the “maybe” category.

This creates more leverage for the homes around you.

Understand that neighborhoods have a general price­ range that houses within it should sell for.

Regardless of how superior your home is to the competition, the price tag should be within that range.

Placing your home outside of that range will limit its visibility.

Overprice your home and you’ll likely watch homes in your neighborhood sell one after another while you stand miserably by.

It Disappears on the Web

The only thing worse for sellers than an overlooked home: An invisible home.

Not surprisingly, over 80 percent of home buyers use the internet to help in their home search.

Various real estate platforms across the Net enable prospective buyers to pull up every MLS listing in a given area.

The first filter any buyer uses is to configure their price range.

If you overprice your home, those buyers that might be interested in it might unknowingly filter it out.

And you can’t blame them. When you list your home, its price goes out across many different channels to compete against many other homes.

It’s important that you broadcast accurate information.

Take Away

If you’re serious about selling:

Just don’t overprice your home.

It will scare off buyers, end up on the market forever, get a negative stigma, push buyers to nearby homes, and all but disappear from the web.

The most important thing you should do to make sure you accurately price your home is hire a professional Realtor.

You also want to avoid taking pricing estimates from real estate sites seriously and making a decision with emotion involved.

If you do these things, you’re guaranteed a smoother sales process. Fail to price your home correctly and you’re in for a long and arduous road.

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