If you have talked with a real estate agent — at least an experienced one — about selling a home you have undoubtedly heard that you should price the property correctly from the start. You may have thought, “Yeah, that’s just to make a quick sale and get paid.” If so, you were half right …
A recent article from the Washington Post ( The right listing price can be the difference between a quick home sale and a long slog )makes an important point:
“Typically, your eventual offer will be much lower than if you priced your home right from the beginning …. That’s because an overpriced house will sit on the market too long and buyers feel they can offer less.”
Real estate professionals do care about selling in a reasonable timeframe for the location and market conditions. You should care too. In the Austin area in recent years, demand has far exceeded supply and many sales have been contracted with hours or days of listings hitting the market. Buyers who are frustrated by not being able to move fast enough to make a successful offer may begin to think that if a listing lasts a few weeks there must be something wrong with the property. They may make a discounted offer or simply choose not to see it at all.
If you follow me on this site or on social media you know that data matters, so here are a couple of charts showing exactly that in the Austin area since January 2017:
The average ratio of ultimate sales price to original list price across that 28-month period was 97.65%. The average sale price over the same period was $371,378. That makes the average list price of those sold properties $380,315, meaning that the average home seller sold for almost $9,000 below the asking price.
But look again at the first chart and notice that the “Sold 91+ days” line averaged about 94% across the 2-plus years. Using that average list price of $380,315 again, that says that those sellers sacrificed $15,000 while they continued to make mortgage payments, accrue property tax and HOA obligations, and maintain homes many had already sold mentally and emotionally. They would have been better off to price their homes right from the start, bank or invest those extra proceeds, and move on to the next chapter of their lives.
On this site you’ll see that I study the market constantly and carefully, and I bring that knowledge and experience to price consultations with my clients. Setting the price is always the seller’s choice, but I owe my clients the best professional advice I can provide, and the discussion above is an important topic for all.
Is pricing all there is to getting your home sold? Of course not! See Beyond Price for more.