While the goal is to get the highest possible sales price, in a reasonable period of time, listing a property above its market value often turns away prospects, and decreases the likelihood of a successful sale (see chart A).
An overly aggressive price prevents a property from taking advantage of a key driver in property marketing – timing. It is well known that a property attracts the most excitement and interest when it’s first listed (see Chart B).
If a property is priced above market value, it does not appropriately benefit from the peak interest period. This may ultimately lead to a sale below market value (see Chart C), or no sale at all.
The initial asking price is a critical aspect of your property marketing plan. Statistics show time and again that homes that are priced properly when first brought to market sell at a higher sales price, oftentimes with better terms and conditions, and in a shorter time frame.
Testing the marketplace with an inflated/over-the-market value asking price is not the best strategy even in a seller’s market. If you price it just right it might even generate multiple offers. A best-case scenario for sellers. In a buyer’s market, it may even prove to be disastrous.
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