Overpricing Listings Is Real Estate Malpractice

By
Real Estate Agent with Keller Williams Realty

Last week, I received an offer for a home that I had listed earlier in the week in Charlotte North Carolina.  The offer was acceptable to the seller and so pending a good inspection, we should have a rather quick closing which makes my clients very happy.  This home wasn't the cheapest home on the market or the only one for sale in the neighborhood.  Buyers wanted this house because it looked good, was in the right location, and was priced right.

All too often, I see where sellers and agents alike use what I term as a SWAG price (slightly wild a$$ guess) when they first list their home for sale.  I'm sure there are dozens of other terms that relate to the same thing but you get the idea.  I can't tell whether they are hoping the buyer never looks for comparable listings or if they are pricing with the aid of a dart board.  In our market, there are far too many agents and sellers who are just...optimistic.  Optimism is fine but it real estate it is costly. 

The number one reason you want to be priced correctly from the start is that your home will be exposed first to those who are ready to buy.  In every market, full-time agents like myself have dozens of buyers they are working with at a time who are looking for that perfect house.  Every morning, they get emails from the MLS systems with the latest offerings and that may lead to a showing.  If your home isn't priced where it should have been from the beginning (and is ready to sell generally), you may miss one of those ready-to-move buyers.  Once the ready to move crowd seen your house and rejected it, you're now waiting for new buyers to come into the market and discover your home.  Don't necessarily think that a price reduction will do the trick either.  It's much harder to get a buyer back through the doors after they've said no once. 

Think of it a like a job interview.  Instead of showing up in a good looking suit, you go the extra mile and wear a tuxeudo and demanded $25,000 more than they were willing to pay for the position.  They would most like think you were an absolute looney and dismiss you.  Try to schedule a second interview and see how far that gets you.

In the last six months, I have blown away so many agents by showing and writing an offer on the first day the house was listed.  They are grateful, the buyer is getting a great deal, and the seller is pleased beyond compare.  The reason is that we've seen all the overpriced listings on the market and they're waitng for new and better.  Your home can only be new and better once....twice if you hire a really good agent the second time around.  So then why not have it ready to show for the ones who are the most qualified to buy your home?

Some sellers will make the choice of their agent solely based on the price they will list their house at.  All they would need to do is ask to see the expired stats for that agent or the area to see how bad of an idea that is.  If their average days on market is extraordinary, just assume that yours will be too.

The bottom line is sellers that in real estate, price really is everything.  Therefore, don't goof (yes, I know very eloquent) on the most important aspect of selling your home!

 Jonathan Osman
Charlotte NC Homes, Charlotte Real Estate

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Tags:
tips for sellers
preparing a home for sale
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Rainer
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Deb Jamail
HomeLife Southern Properties - Galveston, TX
Galveston County Real Estate

Johnathan well done! 

May 29, 2008 01:54 PM #1
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Anonymous

I am in total agreement with you.  All of us agents need to make sure that we represent our buyers and sellers with the upmost professionalism and honesty.  We should be taking the time to run CMA reports on the properties for our clients to make sure that everyone around is getting the right price and a fair price depending on what the home is worth.  Jacking up prices by agents is just the wrong way to go, you are right you will not get a borrower back in once they have left or said no once.

May 29, 2008 01:55 PM #2
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Eileen Musser
no longer in real estate - York, PA
EX Realtor

You are so right right right.........  Thanks for the reminder.

I like your fresh writing style!

Green Eileen at Gateway

May 29, 2008 01:56 PM #3
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Jimmy McCall
TheHappyCottage.com - Cunningham, TN
The Ex-Mortgage Consultant

Jonathon,  Congratulations on the quick sale and good job pricing your homes at the right price.

May 29, 2008 01:57 PM #4
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Tracy Santrock
Fonville Morisey/Santrock Realty Group, Inc. - Cary, NC
Raleigh - Cary Realtor

SWAG - I like that term.  Guess I'll have to use it behind closed doors.  Great post.

May 30, 2008 12:06 PM #5
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Jim Crawford
RE/MAX Paramount Properties - Atlanta, GA
Jim Crawford Atlanta Realtor - Atlanta Real Estate

It is an unethical as you can get, and even violates the NAR Code of Ethics.

May 30, 2008 12:18 PM #6
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Jonathan Osman

Charlotte House Hunter Group
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