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April 21, 2024
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Luxury Realtor Austin W. Bergman on The Risks of Overpricing Houses

Luxury Realtor Austin W. Bergman on The Risks of Overpricing Houses
Photo courtesy: Austin W. Bergman

Putting one’s home on the market can be an exciting yet stressful time as a seller. You likely have a number in mind that you hope to get for your property. Your number sometimes is not the right number. As the saying goes, “Everyone thinks their home is worth more than what it is.” If you do not hit the asking price right, an unfortunate reality is that homes sometimes will sit for months without garnering serious buyer interest, especially when overpriced. 

Austin W. Bergman, a seasoned luxury real estate agent, has witnessed this scenario unfold numerous times throughout his career. He elaborates that buyers typically invest in properties they perceive as valuable, and he advises reconsidering the price if any of the following criteria apply.

So when do you know as a seller that your home is overpriced?

Are You Questioning Your Agent’s Marketing

If you’re questioning whether your agent is putting in sufficient effort to market your home, it’s probably because you’re experiencing a shortage of showings and offers. Austin emphasizes the importance of honesty, stating that no matter how much marketing is done, it can’t compensate for an inadequately priced property.

Are You Tired of Keeping Your Home Show-Ready

Keeping your home in show condition day in and day out becomes exhausting. As a seller, you put great effort into meticulously staging your home, only hoping to maintain this façade briefly before garnering offers. But when weeks drag on without any showings booked, the reason becomes plain as day – your home is overpriced. 

The longer a home taxes sellers through this daily show-ready grind without any buyer interest, the clearer the pricing miss becomes.

Occasional Showings Don’t Lead to Offers  

Every now and then, a buyer agent may request a last-minute showing, sparking excitement and hope that this could finally be the one. You frantically prepare each room before greeting the potential buyers with nervous optimism. But as you observe their distracted reactions, you realize they are mere “looky-loos” with no actual purchasing ability at this overpriced point. 

They thank you politely and are on their way. The pattern repeats with each showing that comes along. Overpriced homes attract activity but not legitimate buyers. Until you adjust the price, every showing will be a false hope as your home languishes.

No Showings for Extended Periods

This is the clearest sign your home is overpriced for the market. Ask yourself – if you were house hunting in your area with all the technology available today and you saw your home at your home’s price point, would you schedule a tour? If not, a price adjustment is in order.

On the Market Too Long

Austin suggests reconsidering the price if your home has been listed for more than 90 to 120 days without any offers.

The Tendency to “Chase the Market” 

Austin also warns against the fruitless practice of “chasing the market” with incremental price cuts over months or years. This wastes precious time as your home languishes. Price it right from the start, and if you don’t and you realize this while on the market, cut to the chase and price it accordingly. 

He advises that persisting with an inflated price will only lead to frustration for both you and your agent. Instead, recognize the need to adjust your home’s price to a level where it will attract buyers, ultimately resulting in offers.

Don’t Ignore the Warning Signs

As a seller, it’s crucial you pay attention to the signs that your home is overpriced. Promptly adjusting your pricing could make the difference between selling your property for a number you’re happy with versus having to settle for less down the road. 

When you lower prices while demand is still healthy, you revive buyer interest quickly and retain negotiating leverage on offers. But if you let your overpriced listing linger too long unsold, it starts to rot on the vine. The longer it stays out there, the more you signal something is wrong. Before you know it, you’ve lost all bargaining power and have no choice but to slash prices drastically just to get out from under a failed listing.

The warning signs are there for a reason – to give you a chance to correct your course before circumstance forces your hand. Stay alert to these red flags so you can act decisively. If you heed them early enough, you can still steer your listing to a successful sale outcome rather than chasing the market into oblivion after it has left you behind.

Published by: Martin De Juan

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