Most real estate brokers will tell you: overpricing your home from the moment you put it on sale is asking for trouble. You have so little to gain and so much to lose. Here are the reasons why.
A seller may be tempted to ask for an exaggerated price in case a buyer, too naive to realize it or too rich to afford wasting time, finishes by taking the bait. That is wishful thinking. The odds of that happening are slim. Very slim.
Perhaps the homeowner thinks, since there is no hurry, that he will patiently wait for his price, comfortably seated at home. A buyer will eventually come knocking. Wrong!
Perhaps the seller overestimates the value of his property or demands an unreasonable price to compliment his homeowner’s pride. No matter the case, he will regret his decision.
The seller may expect to fully recover the cost of the renovations precisely carried out to boost the selling price. “The renovations cost me $10,000, so I’m adding $10,000 to the asking price.” He will come up short with this simplistic reasoning.
It is incorrect to believe that you can ask for the price you want just because it is your property, you are proud of it and you have worked hard to increase its value over the years. The market will determine the price, not you. It is the logic behind supply and demand. Wanting to beat the market is unrealistic.
Experienced real estate brokers know all too well: the greater the number of buyers racing toward newly listed properties, the greater the seller’s odds of obtaining the desired price, as long as it is reasonable, namely in conformity with the market conditions.
If the property remains on the market for too long, buyers will end up thinking: “Why is this property not selling? Something must be wrong with it.” If the seller takes too long to lower the price, it may be too late. Buyers will have turned their backs on the property indefinitely.
Even if the seller, distraught, drops his price suddenly to attract the buyer with a phenomenal deal to reclaim his attention, the latter will only become suspicious. Not to mention if the property for sale has been on the market for too long, many buyers will have found elsewhere.
If the seller thinks: “I’ll keep my price this high for as long as I can and if nothing happens, I’ll lower it and call a broker who will sell it for me quickly.” Bad idea! If the buyer has already made up his mind about your property and thought it was overpriced, he will not turn back. The broker is not a miracle worker. The damage will be done.
If the seller makes the mistake of asking for an exaggerated price from the outset, he may be forced to sell his property at a lower price than its market value, which would be very unfortunate.
To achieve your goal of obtaining a ridiculous price for your home, the real estate market has to be exceptional. This means a large number of buyers are racing to buy properties while the supply is at its lowest. This situation rarely happens.
*The masculine gender is used throughout this article for the sake of conciseness and is meant to be inclusive of both genders.