When it comes to selling your home, setting the right price is one of the most important decisions you'll make. Many sellers are tempted to price their home higher, hoping for room to negotiate. But pricing too high can backfire, costing you time, money, and potential buyers. Let’s break down why pricing to sell is often the better strategy compared to pricing to negotiate.
The Perils of Pricing Too High
Pricing your home above market value may seem like a smart way to leave room for negotiation, but it can actually have the opposite effect. Homes priced too high often linger on the market, making buyers wonder if something is wrong with the property. The longer a home stays listed, the less interest it generates.
One key issue with overpricing is that it can price your home out of certain buyers' searches. For example, if your home’s market value is around $400,000, but you list it at $420,000, you may exclude buyers who are looking in the $350,000-$400,000 range. These are likely the buyers who would be most interested in your home and most willing to compete for it.
Lower Price, More Buyers
There are always more buyers at a lower price point. Pricing competitively—right at or slightly below market value—opens your home up to a larger pool of potential buyers. This strategy can encourage multiple offers, creating excitement and competition among buyers. In a multiple-offer scenario, buyers may offer more than the asking price, driving up the final sale price.
According to the National Association of Realtors, homes priced competitively are more likely to sell quickly, often for a higher price than homes that start overpriced and later need a price reduction. In fact, a well-priced home may even spark a bidding war, which can significantly increase the sale price.
Priced to Sell vs. Priced to Negotiate
When a home that is "priced to negotiate" is compared to a competing property on the market that is "priced to sell" at the same final price, the "priced to sell" home almost always wins. Why? Because buyers view it as a better value. The home that is priced to sell is likely to attract serious buyers quickly, while the overpriced home sits on the market waiting for offers that never come. It's "over priced" for what it is.
In real estate, perception is everything. If buyers see your home as a great deal, they’re more likely to act fast and make a strong offer. Homes that are overpriced, on the other hand, often become “bridesmaids, never the bride” — they get passed over for homes that offer better value.
The Bottom Line
Pricing to sell is a proven strategy that attracts more buyers, generates more offers, and can ultimately lead to a higher sale price. Overpricing your home in hopes of negotiating down can result in your property sitting on the market longer, leading to price reductions and diminished buyer interest.
If you're considering selling your home and want to know what it might sell for in today's market, reach out to us. We can help you set the right price to ensure a quick and successful sale.
