Getting The Price Right On Your Home
by Real Estate Sales Representative Kate Broddick
A really smart person once told me that “a home well-priced is a home half sold.” That smart person was me. Just kidding!
It was a real estate broker who has run a very successful real estate business for more than 25 years. And it was probably the best advice I was ever given throughout my career as a Realtor®. Since then, I try to educate my clients on the negative impact of having an overpriced home.
When it comes to selling a house, the emotional factor can sometimes lead clients to believe their home is priceless. It’s understandable; the pride of ownership and the personal memories of the home can cloud their judgement when setting a price. It’s the main reason we tell you to depersonalize your home when getting ready to sell. This way, it’s a product for people to see, rather than a short film of the life you’ve lived in it. It’s my job to reign you in and sell your home for what it’s really worth — fair market value — not what your personal attachment to the house says it’s worth.
(Now of course, there is that odd chance that the Queen of England is going to come with her bags of money and pay $50k more than what your house is worth… Or not.)
Believe me – I’ve heard every reason for listing a home at more than it’s worth from clients with dollar signs in their eyes.
“If it’s worth $350,000 we should list it at $375,000 so we get that price.” No. Wrong. Absolutely wrong.
“But we need to get that much money to pay off debt/put a downpayment on a bigger home/fill in your excuse here.” Nope. Sorry. Just because you need more money than your home is worth doesn’t mean you can get it. A well-priced home will sell for what it’s worth, or ridiculously close to the asking price. I can attest to this; 9 times out of 10 when my selling clients listen to my advice, they get at least 98% or more of the asking price! Conversely, when selling clients don’t listen to me, the home sits stale on the market, price reductions happen, and nobody is happy. Including me. Why? Because now you believe I’m not able to sell your home.
So how do we know if a home is over-priced? I’ve compiled a few points that indicate what you’re asking for your home is downright crazy.
An embarrassingly higher price tag than homes sold for on your street.
Just because you have Persian rugs lining your living room, doesn’t make your house worth $25,000 more than your neighbour. We know you have awesome things, but unless you’re selling those Persian rugs with the house, nobody cares. Real estate agents and buyers (because buyers are smart these days) compare your home directly to what’s active on the market and more importantly, what has sold. Your home better have a built in ATM machine spewing $100 bills to be asking a substantial amount more than what’s sold in the last 6 months!
Nobody is booking a viewing.
That’s right. No one wants to come to your house. Why? Because it’s over priced. Plain and simple. They think you’re nuts for asking what you’re asking. They don’t even want to deal with you because they already have this preconceived notion that you’ll be difficult. They will move along to the next house that’s well priced and put an offer in there. Or, they’ll be in such awe at how ridiculously priced your home is that they have to see it. Which leads me to number three.
Tons of people are viewing, no one is offering.
Your home has been on the market for months, people are coming through, nobody wants to buy it. Let me guess? It’s your real estate agents fault? Or, it’s the buyer agent’s fault? They obviously aren’t screening their buyers properly because your house is so amazing it should have sold on the first day, right? I’m sorry to tell you – it’s because it’s overpriced. Plain and simple. Beauty belongs in the eyes of the beholder. Everyone else just thinks “meh, it’s okay”.
The houses around you are selling fast.
If everyone else’s house is selling quickly, then the market is doing just fine in your area. You can’t blame that for your house not selling. So now what’s the excuse? Nobody appreciates the unique décor, the hard work you put into painting the living room 15 years ago or the $1200 golden swan faucet in your master bathroom? The biggest mistake people make is they believe they are entitled to the money they put into their home. Just because you have imported Italian mosaic backsplash tile doesn’t mean there is a market for it in your area.
Agent feedback: “It’s Overpriced”.
When other agents show your home to their clients, we routinely ask for feedback on what the potential buyers thought after their viewing. So what are their comments? Are buyers routinely saying your house is overpriced? They can’t all be wrong. Be realistic. They may have loved your home but the price is scaring them all away!
So there you have it: five pretty basic points to consider if it may have been suggested that your house is overpriced. Let’s just check the ego at the door and price your home properly. It’ll be a win-win situation, I promise!