Nevada City Virtual Tour

Saturday, September 24, 2011

Overpricing your home in Grass Valley


When setting the sales price of their home, many sellers are tempted to tack on a few percentage points to “leave room to negotiate”.

Overpricing a home can have many ramifications for a home seller.  It can limit the number of potential buyers who can afford your home, reduce showings and create an impression in the marketplace that the homeowners aren’t really serious about selling their home.  Serious homeowners who overprice their home often get caught in the trap of price reduction after price reduction trying to catch up to the market. Your home will also get considered stale by other agents and buyers who don't need to wait for you. Not good.
During the past year, U.S. home sellers slashed more than $24 billion from home listings on Trulia .com. Trulia’s Q1 Home Offer Report indicated that on average, most sellers will reduce their list price after 79 days on the market, choosing to cut their original list price by 8 percent. Following a first reduction, 35 percent of those sellers then will make a second adjustment. Maybe a third, then maybe weekly. And some more time passes..... How long do you want to wait? What if you are trying to buy another home? Can't if your home is not in a solid escrow. Your dream home is now being bought by somebody else.

Most home buyers look at least 10-15 homes minimum before making a buying decision. Because of this, setting a competitive price relative to the competition is an essential component to a successful marketing strategy.

Whenever I have a seller looking for more than their home is worth compared to the tremendous competition – I show them homes in that price range. Then I ask them what they would pay for their home – knowing what the competition is… If they still quote the overpriced number I would congratulate them and say “Well, you turned out to be the highest bidder on your home. Congratulations! You still get own it!”.  Then I ask them gently again if they would like to SELL it…  I know it sounds harsh. But pricing it right at the beginning is the most important thing of all to get something sold in a reasonable time frame. Doesn't matter what agent you have, how many open houses, how many ads, how much internet exposure, doesn't matter. 

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