Can't I Just Drop the Price? The Dangers of Overpricing Your Home Sale

by Jeff Minter

When you're selling your home, you want to make as much money as possible. In a hot market like we've been in, why not list it high and bring that price up; after all, you can always drop the price, right?

We hear this a lot. And while it's a reasonable assumption, over pricing could be a very costly mistake.

Sellers who try to see how much they can get for their home by pricing high may be setting themselves up for failure with the likelihood of a longer sale process and less money in the long run.

Even in the crazy market of 2021, homes that required a price reduction sold, on average, 49 days more slowly than those that did not.

In addition, homes requiring price reductions sold, on average, for 7.2% below the original asking price. Meanwhile, homes that didn't require a price reduction sold, on average, 3.3% over the asking price. That's a 10% swing in sale price between price reduced homes and homes priced correctly from the beginning.

The next time you talk to an agent about marketing your home, make sure you have an open and honest dialogue about appropriate market pricing. Don't let an agent take your listing simply because they promise a higher sales price. Sellers who pick a realtor based on that detail alone may cost themselves thousands of dollars. Instead, discuss their marketing plan and make sure that your home will be seen by the highest number of potential buyers possible.

If you have any questions about your unique situation, reach out to our team. We're always happy to talk.