You need to sell your Chapel Hill or Carrboro home and you've been interviewing Realtors. Let me stick my neck out a bit and say you aren't exactly hearing what you'd like to hear...maybe it's what you expected to hear on some level but there was always that little glimmer of hope, right? Maybe, just maybe, you could hold out for a bit higher selling price than what you’re being told. After all we live in a wonderful, vibrant part of the country and of North Carolina. We have an enviable quality of life and some of the best schools in the state. We never saw the outrageous appreciation that some states saw so we couldn’t possibly be seeing the depreciation they keep reporting in the news. Surely there are folks looking to move here who understand this and will open up those pocketbooks a tad wider to accommodate the price you know your home is worth.
“What harm is there in trying it just for a while?” you ask. “Besides, don’t we need some negotiating room built in to the price? A little something to make the buyer feel like they got a good deal?”
You need to hear me say this: You are talking about over pricing and it is a very, very bad strategy. Here are the facts.
The red bars show the percentage of the original list price which was achieved at closing when the original listing price was the same as the final listing price at the time of sale for Orange County, NC homes. In other words, the listing agent and seller PRICED THE HOME CORRECTLY and did NOT have to lower the original asking price before accepting an offer.
The yellow bars show how much LESS homes in Orange County, NC sold for when the listing agent and seller OVER PRICED THE HOME TO START and were forced to LOWER the asking price before getting an accepted offer. The percentage achieved at closing was negotiated off the final list price, NOT the original list price.
The red bars show the average Days On Market for an Orange County, NC home when the original listing price was the same as the final listing price at the time of sale. In other words, the listing agent and seller PRICED THE HOME CORRECTLY, did NOT have to lower the original asking price before accepting an offer and the home sold significantly faster.
The yellow bars show how much longer it took to sell homes in Orange County, NC when the listing agent and seller OVER PRICED THE HOME TO START and were forced to LOWER the asking price before getting an accepted offer. The average Days On Market is significantly longer. Time is money and sellers who over price undoubtedly paid a few more mortgage payments than those who do not over price.
You can see that over pricing, as a strategy, has never been a good idea but in an unforgiving market like we are experiencing now it can mean the difference between the seller bringing money to the table or not.
The value of significant real estate experience can not be overstated in 2010. If you are serious about accomplishing your real estate goals, give me a call. I'll give you all the facts you need to make the right pricing decision.
~These charts reflect the latest data available from the T.A.R.R. Report. A subscription publication for Triangle real estate practitioners~
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SarahGray Lamm is a licensed, full time, residential real estate professional in the Raleigh Durham area of North Carolina with over 60,000 hours of experience. She specializes in serving the real estate needs of home sellers, home buyers and investors in Chapel Hill, Carrboro, Durham and Northern Chatham County and is proudly associated with Allen Tate Realtors, the Carolinas #1 independent realty company.
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It's very hard to convince some sellers that there house is no better than most of the others. So why is theirs worth more?
John, I don't believe sellers want to try a higher price because they think their home is "better". I think it is overwhelming to realize that your home is not worth more than you paid a couple of years ago or that the equity you believed you could count on just isn't there. It's an honest question "can't we just try it?" But the honest answer is that it will hurt more than itl help. Sellers get one chance in this market to show they "get it" and have done the work they need to do to attract one of the well informed and qualified buyers out there.