The most common reason a property fails to sell is that it is overpriced. If your property is listed at a price higher than what buyers are willing to pay, you will likely struggle to find a buyer. Underpricing your home may lead to more showings and offers, while overpricing can make it sit on the market for months.
Key Takeaways:
- The #1 reason a property fails to sell is being overpriced for the local market and comparables
- Overpriced homes usually receive little interest, few showings, and no offers
- Setting the right asking price from the start is crucial based on recently sold homes in the area
- Being flexible on price and willing to negotiate can help sell an overpriced property
Determining the Right Asking Price
Pricing your property correctly from day one greatly increases the odds it will sell. The temptation may be to price high and hope for offers to come in below list price. But an overpriced property fails to sell more often than not.
As a seller, you need an accurate sense of your local housing market and recently sold comparable homes in your area. Comparables should be similar in size, condition, location and features. Understanding the average sales price per square foot and days on market for similar properties prevents you from overpricing.
If your agent recommends a listing price, take it seriously. They should demonstrate how they arrived at that price with neighborhood comps and market data. Price too far above these and your property fails to sell.
Consequences of Overpricing
Initially overpricing may seem harmless if you plan to negotiate. But in reality, overpricing has damaging effects:
- Fewer showings and walk-throughs
- Very little interest or online inquiries
- No reasonable offers to negotiate against
- Your listing grows “stale” the longer it sits
- Buyers wonder if something is wrong with your property fails to sell
Being too firm on an overpriced asking price can cause your home to linger for months. And home searchers may assume you are unreasonable or fail to take the market seriously.
Negotiating Overpricing
If you strongly overpriced your listing, refusing to negotiate on price is unlikely to work. Most buyers have a firm budget and will not overpay.
As days on market add up, you may face pressure from your agent to reduce the listing price. If no showings occur after 2-3 weeks, promptly dropping the asking price is wise.
Ideally you should price within 5% of fair market value from the start. But being flexible to negotiate overpricing can still help sell a property that fails to sell otherwise. Just don’t wait too long to adjust above-market pricing.
The #1 reason homes linger unsold is owners overpricing versus local comps. Price aligns with the market from the outset makes all the difference in successfully selling your property.
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