The Shocking Truth About Home Pricing: What Every Seller Needs To Know!

 

Many sellers believe that if they list high, then drop the price, that they are guaranteed to get the best for their home. 

 

That is not the case. 

 

In the Inland Northwest, listing too high normally has 3 results:

    1st) The home gets few showings and no offers 

    2nd) The home doesn’t sell and sits on the market

    3rd) Buyers notice that the home hasn’t sold and begin to wonder if there is something wrong with it.  

 

 

Here is a real-life, local example:

 

In 2024, I worked with a wonderful seller who was very specific that he wanted to list his home 14% higher than market value.

After discussing the probable outcomes to this strategy, the seller decided to proceed with the high list price.

 

   Throughout the year, the actual market value for this particular home stayed essentially the same. 

    Although there were several showings at first, all buyers (and their agents) concluded that the home was too “over priced,” and declined to submit an offer. 

After about 3 months, investors and ‘lowballers’ started submitting offers that were around 20% Lower than his LISTED price and 12% Lower than ACTUAL market value.

 

The seller was perplexed. If the buyers wanted a lower price than he was asking, why didn’t they offer the Actual Market Value?

 

Investors and desperate buyers who can’t find anything in their actual price range watch the market for homes that are “just sitting.” Once a house hits the 3 month mark, they begin to see the home as a potential ‘deal.’

 

9 Months after initially listing the home, the Seller, after a series of small price drops, changed the sale price to ACTUAL Market Value. Suddenly, the home was getting showings and offers. Again, he was perplexed. The home was on the market for 9 months. Buyers had to have seen it. So why hadn’t they just made him an offer before the price change?

 

 

Reason 1) Most responsible Buyers know their budget and shop within 3 – 4% of their budget price range. They will not even see your listing if it is priced higher than that.

 

Reason 2) Competition – When a home is listed at Actual Market Value, it competes with similar homes and has a great chance of standing out, because – let’s face it- Your home is the best in its class! 

   However, when a home is listed above market value, it is now competing with a class of homes that is bigger, newer, or in a better location.  It is now the least desirable home among the more expensive competitors.

 

 

 

  Ultimately, this great seller did not make any additional profit, but lost 9 MONTHS of precious time. 

   

 

 

 

*To learn more about how the listing price impacts sale, or how to choose the best valuation for your home, please feel free to contact us.