Whenever we provide a Seller a recommended list price for their new listing and they are not in a hurry to sell their home/investment property, the majority of them want to “test” the market for a higher list price. Within the first 21-30 days, we can determine how well the list price is being accepted by serious Buyers using the following guidelines:
1 – Buyers are accepting the price – we would have received at least 1-2 offers within the first 21-30 days on the market.
2- Seller is getting showings from perspective Buyers, but no offers have been received. The home is likely overpriced by 5-10% of what the market will accept.
3- Seller has had -0- showings. Serious Buyers have rejected the list price as being too high above their perceived market value for the home/investment property. The home is likely overpriced by 10%+ above what the market will accept.
When pricing a home for sale, we have to remember the buyer has more tools and education available to them than ever before. They watch the days the home has been on the market. If it goes over what is acceptable for the neighborhood’s average days on market, the home will be deemed as “something is wrong with it” and this increases the chance the seller will receive a low offer from these buyers.
Websites like Zillow and Trulia will provide the buyer with a general estimate of what the home is worth. While these estimates aren’t always accurate, many buyers use them as a guideline for pricing in any given neighborhood.