One of the most well-known real estate mantras your real estate professional will tell you is this: “If you overprice your home, it will take longer to sell and it will sell for less money.” Yet, many sellers believe their homes can defy market physics.
Overpricing seldom works because buyers search for homes online according to their loan qualifications. If their ceiling is $500,000, they’re not going to search for more expensive homes, and your home won’t be found by the buyers who are most qualified to buy it. When buyers can afford more, they’ll compare your home to other homes in the same price range and your home may fall short in features, location or condition.
Search price increments vary depending on scale. Buyers use $10,000 increments for $100,000 homes and $100,000 increments for million-dollar homes. Pricing just over a logical range end point like $255,000 or $505,000 will exclude that home from some search results. If you price just under a range end point, like $498,000, your home will be seen by the buyers who are most likely to buy your home.
While some buyers’ search in higher price ranges than their rounded end point, their intention is to offer less, so that makes setting a higher price for your home counterproductive.
Your best chance of selling your home quickly for the highest price possible is to attract buyers who see your home as well priced. You’ll attract more serious buyers who make higher offers with fewer negotiations.