A few years ago, homes were flying off the shelves and getting multiple offers well over their asking price. It felt like you could name your price and still have buyers lined up at the door. Reason? Well, how about interest rates? They were in the 2’s, 3’s and 4’s, depending on where you consider “a few years ago”. And today they’re at %6.89 for a 30 year fixed!!!
But today’s housing market is different. Buyers are getting more selective now that inventory has grown. Homes are sitting a little longer. And more sellers are having to cut their prices.
So, how do you still come out on top? It all start with one thing, pricing your house right from the start. Today, that matters more than ever- and it can make or break your sale.
There’s Real Price Disconnect Between Buyer and Sellers
A recent survey from Realtor.com shows 81% of home sellers believe they’ll get their asking price or more. But the actual sales data shows there’s a growing gap between what sellers expect and what buyers are actually willing to pay. Where’s that “disconnect” coming from? For almost 13 years, home prices were steadily increasing. And it’s easy to fall in that “trend” and not look at the memo that “Market has shifted”.
Check out the graph below. It is for average asking price vs sold price of all homes sold in counties of Sacramento, Yolo, El Dorado and Placer for the past 8 years. It is only normal for there to be a gap but as you see, for the past three years, that gap has been widening.
This tells you something important: not all buyers are willing to pay what many sellers are asking. That doesn’t mean you can’t sell for a great price – but it does mean you need to start with a price that reflects what buyers are willing to pay in today’s market.
What Happens When You Overprice Your House?
Pricing your house high initially may seem like a smart move, so you have more room to negotiate. But the reality is, an overpriced home can sit on the market and turn buyers away. I’ve heard sellers say” We price it high and maybe we get it and if not, buyers will just offer less and we can accept that offer. But we shouldn’t start low”. Wrong! In this market, with the high rates and more homes for the buyers to choose from, once they see the house and think it’s overpriced, the likelihood that you might hear from them is slim. They’re gone with the wind and now you have to chase the market. You don’t want to have to do that. Also: once a house has been on the market for some time it becomes a “Stale Listing”: A house which has been on the market for some time that buyers start to think that maybe there’s something wrong with it.
You Still Have a Great Opportunity – If You Price Your House Right
To avoid making this mistake, it’s important to lean on an agent who knows what’s happening locally when you set your asking price.
I will look at recent local sales, buyer trends, and inventory levels to find that pricing sweet spot for your neighborhood – because it’s going to be different based on where you live.
And here’s something else to keep in mind, home prices have climbed more than 57% over the past five years. So, even if you price a bit below the number you had your sights set on, you’ll likely still be in a great position profit-wise.
With a local real estate agent’s help, like me, you’ll attract more attention, avoid seeing your house sit on the market too long, and maximize your chances of getting a strong offer.
Well priced properties are selling, (I recently sold a property with 5 above asking offers), and over priced properties sit and become stale.
Bottom Line
The market has changed, but your opportunity to sell hasn’t. You just need the right pricing plan. Call me so we can go over what’s happening with prices in your area and determine what price would help your house sell quickly and for top dollar.
