Too often, homeowners take a chance that their homes are worth more than they are told and end up overpricing their homes so much so, that they put themselves in a position not to sell. Thus are the consequences of overpricing your home.
In order to avoid a situation in which you are unhappy with the result, it is best to avoid overpricing your home, otherwise, you will end up with the following:
Consequences of overpricing your home #1
Homes priced lower will sell faster
If there are homes in your area that are similar to yours, chances are they will sell their homes quickly, so you might be doing them a favor and none for yourself. You need to do your homework and find out what other homes in your area are not only currently selling for, but what they have already sold for.
Consequences of overpricing your home #2
Home stays on the market longer
When you put your home on the market for sale, the objective is to sell it as quickly as possible. Another major consequence of overpricing your home is that it will sit on the market for longer than you might expect.
It is better to price your home right the first time around, than it is to consistently keep changing the price as the weeks or months go by.
Consequences of overpricing your home #3
Loss of market interest and qualified buyers
Homebuyers who would otherwise be interested in your home might completely overlook your home because your asking price is too high and it doesn’t otherwise fit into their budget.
If someone can only afford $500,000 and you are priced at $550,000 because you feel like it and not because that is what your home is worth, those buyers may not try to bargain you down and may just skip your home altogether.
Consequences of overpricing your home #4
Extra mortgage payments
If you listed your home for sale and planned to sell quickly a consequence of overpricing your home could be that you will end up incurring extra mortgage payments, especially if you have another home that you recently bought before selling.
Consequences of overpricing your home #5
Desperation could lead to lower price
Because your home will likely sit on the market for even longer, you might actually end up accepting less money than what you would have received if you were priced right the first time out. Home buyers might worry that something is up with your home because it hasn’t sold.
In a case such as this, you might do best to take your home off the market for a couple of months and then try again.
Consequences of overpricing your home #6
Buyers might have problems getting financing
Say you did find a buyer who was willing to pay your inflated asking price, it might turn out that they are unable to get financing because the lender doesn’t agree with such an inflated asking price.
Avoid the consequences of overpricing your home
From doing your own research to getting a pricing analysis, you can easily figure out an adequate asking price that will help you sell your home quickly, which is the ultimate objective for all home sellers.
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