Pricing your property to sell
Why overpricing as a selling tactic does more harm than good.
Setting a price for your
property is one of the biggest decisions you will make during the selling
process. Choosing the right price gives you the greatest chance at selling your
home quickly and at the best possible price. Pricing your home may sound simple,
but many sellers make a mistake that causes their property to sit stagnant on
the market, and have to reduce to eventually sell.
Many sellers are under the
impression that they need to add a margin to their home in order to achieve
their actual price. Sellers assume that if they add a margin or in essence
overprice their home, they will be more flexible when negotiating a price with
buyers. Although this may sound logical in theory, in practice overpricing only
does more harm than good.
So why is overpricing
a bad tactic?
There are many downfalls to
overpricing your home. Setting an unrealistic price is unlikely to draw buyer
interest – in most cases your overpriced property can make other properties on
the market look more attractive in comparison. After all, why would a buyer
choose to purchase your home when they could get a similar property for
The longer your property stays
on the market, the less desirable it becomes to buyers. A property that
sits on the market for a long period will often carry a stigma; buyers will
assume that there is something wrong with the property and will be deterred
from making enquiries. It can force the property’s value down, leading you to
accept a much lower price down the track than would have initially been offered
if priced correctly.Therefore you need
to be careful when pricing your property especially in relation to the state of
Isn’t pricing my
home too low just as risky?
Sellers often fear that if
they price their home too low, they risk losing a substantial amount. However,
pricing your home too high is far riskier than pricing it too low. If your
property is priced slightly lower than comparable properties, it will instantly
draw more buyer interest than your competition. More often than not this leads
to multiple offers being made. With a good negotiator in your corner this
generally leads to the property selling at or above market value.
How should I price
my property to achieve the best result?
One of the main reasons properties
don’t sell is price. As an owner, we want to believe our property is worth more
than it actually is. It is important to stay as impartial as possible and
choose a price that is close to market value. What is market value? It is
simply the price that buyers are willing to pay today for a particular
A good real estate agent can
help you establish the correct price point by examining recent sales, your
current competition and the features and benefits your property offers as well
as the state of the market you are selling in. If your property is priced
fairly, you are likely to achieve a quick result at (or above) your asking