Your new realtor suggests you overprice or underprice your home. 

Think it could work?

Read on.

How to Determine List Price

Before you make any decision, it’s good to know that pricing your home right is the final step in a comparative market analysis (CMA). Thanks to online home value estimators, strategies that overprice your home in case buyers offer less are old school now.

Assuming you’re using a licenced REALTOR® or real estate agent, they’ll know precisely what your home is worth. Ask your agent for a CMA that shows:

  • homes you are competing with
  • list prices for similar homes, styles, and sizes
  • and sold prices in your neighbourhood.

A reputable agent’s suggested list price is their best guess based on the CMA, experience, and your priorities. Find an Ontario REALTOR®. Look up if a real estate agent is registered to practice in Ontario. 

Pricing Your House Right

You’ve got the CMA and suggested list price in hand. Should you underprice or overprice your home, instead of pricing your home right?  

What Happens When You Overprice Your Home

Why bother? Most buyers have a budget. Your effort to overprice your home can put it out of reach for many. Buyers won’t spend the time or energy to view your home.  

Let’s face it: buyers know when you overprice your home. They use Zillow too. 

Overprice your home and you risk spending long days on market (DOM). Buyers will wonder what’s wrong with your home. Realtors may assume you’re desperate and lob lowball offers at you. All that tidying to keep your home in showroom condition could be wasted effort.

Avoiding the Impulse to Underprice Your Home

Underprice your home rather than pricing your home right, and you could regret the precious time bidding wars consume. Bidding wars may seem like a great strategy to get top price, but the hype can backfire unless:

  • interest rates are reasonable
  • your market has more buyers than homes
  • your realtor is skilled at managing multiple bid scenarios.

Otherwise, perfectly good buyers may assume your home has issues and walk right by. 

Accept a firm offer real estate bid. 

Best List Price Strategy 

Seriously looking for the best strategy for pricing your home right? Think through your home seller priorities:

  • how urgently you need or want to sell
  • whether you’re prepared to make minor repairs
  • if you want to sell “as is, where is”
  • and what your lowest or best price is. 

Add a 48-hour escape clause to buyers’ agreement of purchase and sale. That lets you accept offers while you wait for buyers to sign off on “subject-to” conditions. Buyer’s remorse Ontario sellers could get stuck with. 

 

Escape clauses and mutual consent release forms make it easy to make changes or move on. Drafting an amendment to agreement of purchase and sale. 

Read More at: https://www.axesslaw.com/articles/why-realtors-overprice-or-underprice-your-home/