We run into prospective clients all the time that tell us – We don’t need to sell – as a way of justifying the high price point they want to set on their house. Our response to them – then don’t put it on the market.
Some home sellers think that if they are under no time pressures to sell, that they can set the price they want and then wait for that perfect buyer to come and purchase the property.
The chances of this happening are slim to none and in the long run this strategy is going to hurt the home seller, help the neighbors, but hurt the neighborhood. Let me explain…
The first point is that no amount of marketing is going to overcome the barrier of a house that is over priced. If a house is sitting on the market and getting no traffic, it is for one of two reasons – lack of exposure or price. If the marketing is there – MLS, Internet, flyers, ads, open houses, and etc., then it’s the price that is the barrier to traffic and selling the property. Throwing money away on hopeless marketing is one of the big mistakes that new real estate agents make. (Hopeless Marketing – promoting something that doesn’t have a chance in a thousand of selling because the price is unrealistic for current market conditions.)
A home seller that doesn’t have to sell, but puts their house on the market at a price that is unrealistic for local market conditions is helping to sell “right-priced” houses in the neighborhood. Nothing works better for a seller than pointing to the house down the street and telling a buyer – mine is bigger with more amenities, in better shape and priced below that one.
In a market with too much standing inventory (like the current market) overpricing your house is going to hurt you in the long run because you will be a factor in the falling prices of homes in your neighborhood which will not befriend you to the rest of the neighbors.
The longer houses sit on the market, the more they influence public opinion about the market. When a large percentage of homes just sit there, it helps to drain the vibrancy from the market. Eventually this will mean the seller must lower their price to sell or they will have waited long enough, a year or two (and gone through 2 to 3 agents) for local market vibrancy to return.
Sellers that don’t have to sell that change their minds in 6 months to “having to sell,” sell for a lot less than someone who priced it right and leveraged the overpriced houses to move theirs quickly. Selling for much less than would have been needed six months earlier hurts house values much more than pricing it right.
If you don’t have to sell – don’t. BUT, keep your house off the market until you need to sell so you don’t hurt your property value though hopeless hoping.
