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Real Estate Pricing Mistakes that Seller’s Need to Avoid!

KyleHiscock

Real Estate Pricing Mistakes that Seller’s Need to Avoid

Selling a home can be difficult, but it does nothave to be impossible. In fact, it can berelatively “easy” if common mistakes areavoided. The mistake that is made most byseller’s relates to the pricing of their home. The pricing of a home normally determineswhether a home will be sold relatively quicklyor if it will linger on the market for a longperiod of time.

If a home is overpriced, it doesn’t matter if aseller hires the best real estate agent in theirlocal market who also has the best marketingplan, it will not sell! Pricing does the majorityof the marketing of a home, between 80-90%.

Listing a home at the correct price will almostguarantee that a buyer will be writing an offerin a quick amount of time (often just a fewhours or days after being listed). Unfortunately, pricing a home at the correct price is not a simple process. If it wasas simple as listing a home for it’s assessed value, there would be no need for real estate agents. If it was as simpleas listing a home for what Zillow’s “Zestimates” say a home is worth, there would be no need for real estate agents.

There are real estate pricing mistakes that seller’s need to avoid because overpricing a home creates a damagingeffect! Here are four mistakes that are more common than others when it relates to pricing a home for sale!

Pricing the Home High to Leave Room to NegotiateMany sellers believe that it is a common practice of a buyer to offer lower than the house is listed for. In most cases,this is the farthest from the truth.

A seller who lists their home for $10,000 more than a real estate agent recommends because they believe this willleave them with $10,000 in negotiating room is making a huge mistake. Today home buyers are extremelyknowledgeable and savvy. The internet has made it extremely easy for consumers (in general) to obtain information. If a home is overpriced, buyers will not look at it. So, the home owner who prices their home higher to leave room tonegotiate won’t have anything to negotiate because potential buyers won’t waste their time looking at a home theyknow is overpriced!

If a home is priced correctly, the buyer’s real estate agent should be providing their client with information so they canmake an educated decision on what to offer a seller. It is still possible in this situation that a buyer will make an offerthat is much less than what a home is listed for, however not as common. Listing a home for market value and notlisting it to leave room for negotiating, will more times than not, get a seller more money in a shorter amount of time!

Pricing the Home with the Real Estate Agent who Offers the Highest List PriceIn most local real estate markets there is anywhere from several hundred real estate agents to several thousand real

Pricing the home with the real estate agent who offers to list the home for the highest price is a

common mistake!

estate agents. For example, the number of real estate agents in Greater Rochester NY area is nearly 3,000. Likeany industry there are professionals whoare great at what they do, professionalswho are average at what they do, andprofessionals who are terrible at whatthey do.

In every local real estate market thereare agents who “buy listings.” An agentwho “buys a listing” will tell a seller theirhome is worth an unrealistic amount ofmoney, just to obtain the listing. This isdoing a huge disservice to any seller andthe agent! A seller who interviews(interviewing is an important tip to helpensure the “right” real estate agent isselected to sell a home) three agentsand selects an agent solely because theagent said their home was worth $50,000more than the other two agents did, and doesn’t have facts to back it up, is making a huge pricing mistake!

Real estate agents are in the business to sell houses and offering a list price that is unrealistic is not going toaccomplish this, thus wasting their prospective sellers time as well as their own!

Pricing the Home without Having A Professional Real Estate Agent Perform a Comparative Market AnalysisAs mentioned above, pricing real estate is not a simple process. There are many things that a real estate agent takesinto account when pricing a home.

A great real estate agent will spend hours researching and “massaging” data prior to determining what they’d suggesta seller lists their home for. A top real estate agent will complete a comparative market analysis, also known as aCMA. There are many sellers who don’t know what a comparative market analysis is, most of the time this isbecause their real estate agent neglected to perform one, neglected to review their CMA with their client, or theiragent never even offered to explain exactly what a CMA is and what is involved with it!

A seller who does not have a comparative market analysis performed on their home is making a huge mistake as isthe Realtor. If a CMA is completed correctly, a home should sell relatively close to the list price and in a relativelyshort amount of time. If a comparative market analysis is not completed on a home, there is also the possibility thatthere could be problems with the home under appraising. The purpose of a market analysis is not only to determine arealistic listing price and probable sale price of a home, but also to reduce the chance the home under appraises!

Pricing the Home High because the Seller has TimeIt is not uncommon for a seller to say, “We are in no hurry to sell, so we want to list our home for $200,000, eventhough you suggest and your market analysis shows that the market value is approximately $175,000.” While adifficult thing to do, a great real estate agent will “walk-away” from this listing. Being in no hurry to sell, does not meanover pricing a home is a good idea. If a seller is not in a hurry, the best option will be to wait until the seller is in aposition to price their home correctly!

Pricing a home high because the seller has time means the house will sit on the market. Homes that sit on themarket for an extended period of time begin to develop a “stigma.” Buyers begin to ask questions, such as, “what iswrong with the home?” It’s very possible that there is absolutely nothing wrong with the home, other than the seller isasking an unrealistic price!

Pricing the Home High because the Seller has Time!

Bottom line, price it right, it will sell! Pricing mistakes in real estate can be avoided, if sellers are aware what they areand what effects they can have on selling ahome! If a home is priced correctly, thereshould be several showings within the firstcouple days on the market and also an offerin hand within the first couple weeks! If thereisn’t, there is a reason the home is notselling, normally the price is too high!

Other Real Estate Pricing Resources

Reasons Why Your Home Is Not Sellingby Bill Gassett

Consequences of Pricing Your HomeToo High by Teresa Cowart

Should I Price My Home Higher Knowinga Buyer Will Try to Negotiate It Down?by Lynn Pineda

Pricing Your Home Right from the Startby Chris & Karen Highland

Why Setting the Price Too High Does Not Work by Xavier De Buck

Selling your home in the Greater Rochester, New York area? It is extremely important to make sure you price yourhome correctly. We’d love to prepare a complimentary comparative market analysis specifically designed andtailored for your home! In addition, we create a comprehensive marketing plan that is also designed specifically foreach of our homes for sale, so contact us today!

About the authors: The above article “Real Estate Pricing Mistakes that Seller’s Need to Avoid” was provided bythe Keith Hiscock Sold Team (Keith & Kyle Hiscock). With over 30 years combined experience, if you’re thinkingof selling or buying, we’d love to share our knowledge and expertise.

We service the following Greater Rochester NY areas: Irondequoit, Webster, Penfield, Pittsford, Fairport, Brighton,Greece, Gates, Hilton, Brockport, Mendon, Henrietta, Perinton, Churchville, Scottsville, East Rochester, Rush,Honeoye Falls, Chili, and Victor NY.

Visit our website at www.HiscockHomes.com.