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The 7 Deadly Sins of Overpricing

August 17, 2011

 “We can always go down, but we can’t go up.”

Have you ever said that?    When setting the sales price of their home, many sellers are tempted to tack on a few percentage points to “leave room to negotiate”.

Overpricing a home can have many ramifications for a home seller.  It can limit the number of potential buyers who can afford your home, reduce showings and create an impression in the marketplace that the homeowners aren’t really serious about selling their home.  Serious homeowners who overprice their home often get caught in the trap of price reduction after price reduction trying to catch up to the market.

During the past year, U.S. home sellers slashed more than $24 billion from home listings on Trulia.com. Trulia’s Q1 Home Offer Report indicated that on average, most sellers will reduce their list price after 79 days on the market, choosing to cut their original list price by 8 percent. Following a first reduction, 35 percent of these sellers will make a second.

Most homebuyers look at 10-15 homes before making a buying decision. Because of this, setting a competitive price relative to the competition is an essential component to a successful marketing strategy. Underpricing a home isn’t good either- educating your clients about the importance of properly pricing a home is key to the home sales process.

If you would like to have a handy tip sheet of these 7 deadly sins, let me know if you can’t wait, otherwise I will be posting them in the next few days

courtesy of Trulia.com

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