Here is another in a recent volley of articles on over-pricing your home for sale.
Making an offer takes a lot of time and energy. Most buyers aren’t willing to do this if they think that the seller is unreasonable.
Instead of making a lowball offer many buyers would rather wait to see if the sellers lower their price before making an offer. Unfortunately, by then the buyers have already bought another home.
If you don’t get any offers, it’s over-priced.
If you don’t get any showings, it’s so over-priced agents won’t even show it.
Sellers who live in areas where prices are declining need to be particularly careful not to overprice their homes.
In a declining market you want to price your home to sell NOW. Otherwise, you can end up chasing falling prices.
ADDED: For example, the Greater Phoenix median home price peaked in June 2006 at $267,000. In October the median price was $257,000.
Let’s say in June you put your home on the market with a high price “to just test the market.” Three months later you’re not feeling so cocky, in fact, you’re starting to get shortness of breath whenever a thought of the home enters your head. So you lower the price. Unfortunately, prices have fallen so your home may now be worth, say, $10,000 less than in June.
I don’t expect prices to fall for the next several months… but you never know. It wouldn’t surprise me, however, if we saw price weakness after June 2007 until January 2008.