OVERPRICING
Overpricing a home can lead to several negative consequences, including extended time on the market, which can create a stigma and make the property appear less desirable. This often results in a lower final sale price, as sellers may need to reduce the price multiple times. Additionally, the longer a home remains unsold, the higher the carrying costs, such as Property Taxes, Hazard Insurance, Mortgage Insurance and Mortgage Interest are items you pay and never get back. Overpricing can also cause the home to miss the crucial early window of buyer interest and lead to buyer mistrust from repeated price reductions. Financing issues may arise if the home doesn’t appraise at the asking price and wasted marketing efforts can discourage listing agents from investing in the property. Setting a realistic price from the start is essential to attract buyers, sell faster, and avoid unnecessary stress and costs for the homeowner. Working with a Specialized Listing Agent to determine the fair market value is crucial for a successful sale.
PRICE DROPING
Another pricing trap to avoid is listing your home far above other homes in the area, with the intention of dropping the price if it does not sell after three months. That is potentially workable in a stable or increasing market. However, if the market in your area is declining, you may be forced to reduce the price even more drastically to catch up with the falling market.
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