Pricing Your Home Right: Why Overpricing Could Cost You
The real estate market in Tacoma, Puyallup, Auburn, Sumner, SeaTac, Des Moines, Burien, Normandy Park, Lake Tapps, and Bonney Lake is picking up. If you’re considering buying or selling this spring, now is the time to make a move.
When selling your home, the goal is to sell quickly and at the best possible price. However, many sellers are listing their homes too high, not realizing the market has shifted as inventory has grown. As a result, price cuts are becoming more common, but they don’t have to be.
Price Cuts Are on the Rise
According to data from Realtor.com, price reductions in February were the highest for any February since 2019. This shift indicates that the market is returning to more typical conditions after the highly competitive years of the pandemic.
Today’s market is no longer the frenzied seller’s market of recent years. Home prices are still strong, but buyers are more cautious, and overpricing could lead to longer time on the market and lower final sale prices.
The Risk of Overpricing
If you start too high and have to lower your price later, you could end up receiving lower offers than if you had priced correctly from the beginning. To avoid this, working with an experienced real estate agent is key.
How an Agent Helps You Price It Right
A knowledgeable agent will use market data to determine the right price for your home based on its current value. Here’s how they do it:
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Analyzing recent sales – Looking at actual selling prices of comparable homes in your area, not just listing prices.
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Evaluating local market trends – Understanding what buyers are currently willing to pay in your neighborhood.
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Creating a pricing strategy – Setting a competitive price that attracts serious buyers and generates strong interest.
In some cases, an agent may recommend pricing slightly below market value to increase competition and encourage multiple offers.
Why Overpricing Can Hurt Your Sale
Some sellers choose to list high, thinking they can negotiate down or test the market. However, this strategy often backfires.
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Fewer buyers will consider the home – Budget-conscious buyers may overlook overpriced listings altogether.
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The home may sit on the market too long – The longer it remains unsold, the more buyers assume there’s an issue.
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Final sale price may be lower – Homes that require price cuts often sell for less than if they had been priced correctly from the start.
The Impact of Time on Market
According to data from the National Association of Realtors (NAR), homes that sell within the first four weeks of listing typically achieve their full asking price. Homes priced correctly from the start generate more interest and, in competitive situations, may even sell for above asking.
However, as time passes, buyer interest declines. Homes that remain on the market longer often see price reductions, leading to lower final sale prices. Sellers who initially overprice their homes may ultimately have to accept a lower offer or reduce their asking price to regain attention.
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