Why Overpricing Your Home Can Net You Less Money

If you're selling your home and you overprice it, it can be costly.

When you list, you can either choose to price it right or overprice it. Pricing the house right assumes that the Realtor proved that they pulled up the proper comparable homes and weighed the features and benefits of the house correctly and are in tune with market conditions. If the seller doesn't agree with this list price, they should openly question the Realtor to prove otherwise.

Sometimes, sellers want to bump up the asking price for their home to either test the market or to leave room for negotiation. However, sellers need to be aware of the cost of overpricing their home:

1. Overpricing can scare buyers right away. Sellers tend to think there is a handful of buyers who will want to buy their home at any given time, but the truth is, there are usually one or two buyers who want to buy the home. Overpricing can scare one or both of them away, leaving nothing.
Overpricing can cause buyer’s remorse and headaches throughout the transaction.
2. Overpricing the home can cause buyer's remorse. Buyers know when they're getting a fair price. If they feel they're getting an unfair price, they might be unfair during the home inspection period and it will cause unnecessary stress and complications throughout the deal.
3. Overpricing can actually net the seller less money. If a house sits on the market, they may have to overcompensate later and underprice the home below market value to generate interest. Secondly, the seller's carrying costs like mortgage, taxes, and utility costs need to be accounted for. Since New Jersey homes can have issues with things like the sump pump or pipes freezing, the sooner the house sells, the better.

Overpricing can cause appraisal issues. When you have issues with the appraisal, it can not only cause a lot of stress, it can kill a deal. If you'd like to discuss home prices and the importance of pricing correctly when it comes time to sell, I'd love to speak with you. You can always give me a call or send me an email and I'd be happy to help.