The real estate market is hot, can a home even be overpriced? Yes, it can, and here is how you can tell.
You took the time to prep your home for the market. You have it on the MLS and you’re ready at a moments notice to vacate for showings. The first few days seem promising, you’re getting showings and you’re ready to see those offers. A week passes and the activity dies down, then 2 weeks pass which soon turns into a month… showings are almost non-existent.
The excitement you once had turns to doubt and now you’re looking for a reason why you’re not seeing an offer. You talk to all your friends and family and they all seem to have stories of “so and so got multiple offers in 4 hours”, or, “so and so sold their home for $20,000 over asking with no inspection” and on and on. So what gives?
When listing your home there are several critical things you must keep in mind. The most critical of which is pricing. Sorry, but buyers don’t care that you built the home yourself or raised a family there. Buyers compare your home to every other home they’ve seen with no emotional attachment. They look through the eyes of comparable homes and asking price vs amenities offered.
5 RED FLAGS YOU’VE OVERPRICED YOUR HOME
1 – You Ignored The Pricing Of Comparable Properties
If you listed your home with any reputable, full time agent they would have gone over pricing of similar homes in your neighborhood that have sold. Did you follow your agents recommendation of pricing?
This is hard and we understand. It’s your home, your sanctuary, your memories. As hard as it can be though try removing the emotion and look at homes objectively along with your agent to determine value. Often sellers get emotional about their home and want to ignore the data. don’t fall into this trap.
2 – Little To No Showings
The first 14 to 30 days are the most crucial and certainly paint a picture of what the market is telling you. In an inflated hot market you could even say the first 7 days will tell you all you need to know. The busiest time for a home will be the first 3 weeks or so in any market. After that showings will typically dwindle down to almost nothing.
Have you listed your home and have had no showings or very few? It is only going to get worse. If you start off with very few showings and have gone weeks with no showing that is tell tale sign your home is probably over priced.
3 – Lots Of Showings But No Offers
Perhaps you’re home is getting shown but no offers. This in itself is feedback that somethings wrong. Lots of showings with no offers points to either an issue with the home you’re not addressing (pet smells, heavy smoked in homes, mold, water in basement etc) or it’s priced too high.
4 – Little To No Showings
Assuming the online photos and other marketing materials look good then no showings is typically feedback of price. Even when the market crashed in 2008 homes were still selling at the right price. Yes, the values were lower but that was the market. A properly marketed home that is properly priced to whatever the market is at the time will always sell.
5 – The Agent Bought Your Listing
Did you hire your agent solely based on the fact they gave you a higher listing price than everyone else? There is a name for that in our business it is called buying a listing.
An agent will play on your emotions and give you an inflated list price. Of course you are willing to believe it they are the professional. But, in doing so you probably did not pay attention to all the details like the agents marketing plan or make them back up their pricing with solid market data.
Was your sole decision for hiring your agent based on the fact they gave you the highest list price?
SELLING A HOME IS A COMPETITION
The competition is the other homes for sale and the game is winning the buyer. At least it’s one way to look at it.
When seller’s insist on overpricing their home they usually fail to see that their home is competing with other homes. Often when a buyer views your home and “rejects” your home they move on to buy another home that they found more compelling.
First you must remember buyers are choosing the homes they personally view online. Your homes photos and statistics must stand up to the other similar home they are viewing online. And, it certainly must carry though to the showing as well.
A house that is compelling at $250,000 amongst it’s competition will certainly not be compelling at $325,000. First it will look way overpriced alongside it’s true competition in the $250k price range. Secondly, it will not hold water to the homes priced properly at $325,000.
THE SILVER LINING
The good news is if you did overprice your home, you can usually overcome it quickly. The key in overpricing your home is realizing you may have overpriced your home and react quickly. If you are able to react quickly there is probably no damage that has been done in the marketing of your home.
The worst thing you can do is let your home sit on the market for 90, 120, 180 days without a change. The internet has sped up the real estate market. In most cases, your home should be sold with-in 60 days.
Work with your agent to get the data you need to make the right decisions regarding the pricing of your home.
If you have any questions about your homes value feel free to contact me with the form below anytime. I have been a full time real estate agent in the Minneapolis area since 2000 with thousands of homes sold.
Contact UsAt The Derrick Monroe Group, we will be happy to answer your questions about buying or selling real estate in Minneapolis and its surrounding areas. Call or text 612-282-7653 or fill out the form below to reach us.