There are 3 main strategies to pricing your home for market: under market value, at market value, and over market value. Underpricing your home decreases your buying power and may deter skeptical buyers. Overpricing your home may cause it to sit on the market, and may price out potential buyers. In addition, price drops are not ideal.
You might think, “Well… we can just drop the price later.” Well… yes, but sometimes the impact of this is not seen as well as pricing to the market straight out of the gate. Price reductions can be overlooked – flyers and emails announcing the adjustment can fall into a pile of other real estate marketing mail.
An initial high list price may also make buyers wonder if the price was reduced because something was found wrong with the home, it may suggest an unrealistic seller with whom there may be some difficulty getting a deal closed with, and it may keep your home on the market so long people wonder why it hasn’t sold. Even for unique homes, price to the market to get people in the door, so they can get to see all the special features of your home.
On the other hand, a low list price may raise questions as to why the price is so low, and get dismissed by potential buyers.
Pricing your home at market value increases your chances of a bidding war, a higher sales price, and a faster sale.