Wednesday, 1 March 2023
Listing your home for the right price! What is real estate market value anyway? This is the value a potential buyer places on a property, based on what other similar properties are selling for at that time and in the same area. It’s important to understand that a property is only worth what a buyer will pay for it. The real estate market has experienced a number of changes since 2020, as we all know. It’s also very important to note that if you’re a homeowner and you’re struggling with understanding why your neighbour’s house sold for more than yours is currently worth, you are not alone. It can be a difficult concept to grasp, and that’s ok. There were a number of factors that led to the seller’s market of 2020, which ended around May/June 2022. A number of factors lead to the end of that market as well. Real estate is a cyclical business. It’s a market that is always changing and we must all change with it. Your experienced and professional REALTOR(R) can explain it all. We are here to help you decipher all of the seemingly never ended stream of information that we come across. But, that’s not the purpose of this blog.
There are more than three reasons, but let me explain three main reasons why you must always list at market value, especially in today’s climate.
1. Serious buyers are frankly tired of seeing overpriced listings.
You’re much more likely to attract serious buyers, who can actually buy your house, if it’s priced properly. The last two years have 
brought so many people so much disappointment, they’re honestly over it. The last thing they want to see right now is another overpriced listing. Especially if it’s a property they actually want to buy. People, who are ready to buy a house, just want to buy a house. Remember how you felt when you bought your place? You just wanted to be a homeowner. You were serious; you had your ducks in a row. You had your pre approval in your hand and you were excited and ready to go! You knew what you wanted and you went looking for it. It may have taken days, weeks or months, but you were on a mission. Nothing is worse to a buyer than having their time wasted even looking at an overpriced listing. You’ve lost them before they’ve had a chance to walk through your front door. More often than not, they don’t even want to book a showing. It is completely discouraging for a serious buyer. They know what it’s worth and so does their real estate agent. If your goal is to sell your house, then it’s imperative that you price it properly from the very first day because *cough* we can look into the history of a listing and we share that information with our buyers. They probably know themselves from watching the listing anyway. Over priced = no showings = not sold.
2. You don’t look unreasonable and difficult to deal with.
We all know first impressions are everything. In real estate, however, first impressions have absolutely nothing to do with the state of your home when a potential buyer walks in, as this requires them physically going to your house. The first impression is made when they are looking at your listing online for the very first time-looking at photos, video, reading the copy and then looking at the ultimate information, the asking price. It can be the best looking listing on Earth, but if it’s over priced, they will not physically put on shoes, grab their purse or wallet, get in a car and go to your house to see this lovely home, that the owner is asking too much for. It’s a waste of time and they automatically assume you are unreasonable.
We all jump to our own conclusions and assumptions when we don’t have all the information we need to form an accurate opinion. The buyer doesn’t know what a nice person you are or what kind of situation you’re in. A friend of yours will care and even try to help you, that’s what friends are for. The reality is this: your potential buyer is not your friend; they exist solely to buy your house. They are also nice people who are just looking for a nice place to live. Because they don’t know your background or general disposition as a fair person, all they see is that you’re asking too much for your house. It leads to assumptions that you are trying to gouge them or pull one over on them. My buyers have said things like “why don’t they just list for what it’s worth? We already know anyway.” Or “Seriously, nice try.” Good point. Real estate sold data is much more accessible now than it was even a few years ago. This means you can’t hide what your house is worth. All real estate agents have access to the same information as well and are obligated to look out for their client’s best interest. This means they are obligated to discuss with their buyer what the fair market price of a property is. You must price it according to the current market conditions.
3. Make it as easy of an experience for your buyer as possible. They’re stressed out too.
The typical buyer doesn’t know what a typical real estate transaction looks like or what is actually involved. For the most part they are not negotiators and do not want to ruffle feathers or upset anyone, for any reason. Like I said above, they just want to buy a house. When a buyer sees an overpriced listing, they anticipate a difficult road ahead for themselves. They’re picturing making an offer for what they’re comfortable with, somewhere around market value honestly, and if they picture themselves getting a counter offer from you closer to your heightened asking price, it will deter them from making an offer. They don’t want to put themselves through that disappointment.
Put yourself in the buyer’s shoes, so they’ll put theirs on and schedule a showing. Many of these folks have experienced getting beat out in competition over the last couple years. Let’s imagine you’re selling a nice little standard three bedroom home, great for a first time buyer or young family. It may be their first purchase ever.
This is what they’ve already had to go through, before they started actively looking for a house:
· They made the huge decision to spend more money than they’ve ever thought of-that’s stressful. Then, they worked their butts off to save tens of thousands of dollars-that was stressful and a lot of work.
· Then, they spent days or weeks getting paperwork together to give to a mortgage lender so they can accurately find out what they can afford-they didn’t know life had so much paper in it.
· Then, they started doubting if they should do this, and changed their minds. This step happens a few times throughout the process-that’s stressful.
· Then, they may have had a life altering event happen that you don’t even know about. That would stress any of us.
· Then, they searched online for countless hours, scouring listings and researching everything from paint colours to flooring to landscaping. By this time, they are mentally exhausted.
· Then, they see a house they love in a good area they like, but it’s over priced. They say “aw, that’s too bad” and move on.
· Then, they speak to their real estate agent for the 37th time this week to see if they’ll ever buy a house. They’re having doubts again. They thought this would be easier. Hopefully they have a good real estate agent who has a good chat with them, and they agree to schedule a few showings.
· They may have rushed home from work and had a super quick dinner, or skipped it all together to come and see your house.
· Then, they might decide to make an offer on that overpriced listing. That totally depends on what kind of people they are and the guidance and support of their real estate agent, which you have no control over. Like I said above, the typical buyer doesn’t want to offer on an overpriced listing for fear they’ll upset the seller.
I know that was a lot to digest, but it's advice that will help you get your home sold, to good serious people who will likely close the deal. I am always here for further questions so don’t hesitate to give me a call at 289-686-5004 or email me at amylayton@royallepage.ca. Let’s talk about strategies to get your home sold.
