Meeting with home sellers in the Edmond and Oklahoma city area almost daily, I have a lot of long discussions about overpriced listings. I even have this discussion with A LOT of local agents. In fact, Jeff Straka and I were just talking about it earlier today.
Why is this such a frequent topic? Well, it's simple... Overpricing a home is absolutely the biggest mistake you can make in the home selling process, yet home owners and real estate agents do it every single day. Now, if you just really like that pretty sign in your yard, then by all means, overprice your home. But if you'd like to actually get it sold, then take this to heart, PLEASE!
Any home, no matter how ugly, will sell if priced properly. Even with poor marketing and terrible curb appeal, a properly-priced home WILL sell in a reasonable amount of time. Transversely, an overpriced home, no matter how pretty or well-decorated or new or impressive, WILL NOT SELL in any reasonable amount of time. In fact, the odds are greatly against it ever getting sold when it's overpriced.
I know, I know, many people think "I'll just try it at this price for 30 days and then lower the price if my dream buyer doesn't come along." Well, here's why that's a bad (REALLY BAD) idea:
- About 80% of your showings will occur in the first 30 days on the market.
- The majority of those buyers are high-quality buyers (they're approved and have probably already lost out on another home they loved because they waited to write an offer; they're ready to act fast on the next house they love) ** Any agent who's been in the business more than a few weeks has seen this happen
- Most of those high-quality buyers will be under contract on a house (will it be yours?) within the next two weeks, so they WON'T BE BACK after you lower your price.
- That leaves you with the other 20% of buyers, which are the lurkers. They're sitting back looking for houses that have been on the market a while, so they can swoop in with a lowball offer.
- The longer your home sits on the market, the more it creates a stigma that something must be wrong with it. Good buyers will be scared away from it by the DOM and the "investors" will come out in droves.
So, by overpricing your home, you simply make the other houses in your area look like more of a bargain, and miss out on the majority (80%) of the potential buyers in your market. Is it really worth it to gamble with the ridiculously low odds that you might make an extra $10K? If you're even thinking about answering "Yes," come back tomorrow so I can show you that you're NOT seeing the big picture!
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