Is Testing The Market With a Higher Price A Good Strategy?
When we are talking to potential sellers, pricing is typically the number one concern. Sellers are often tempted to overprice because they don’t want to leave any money on the table and they want to make sure they get the most money for their property.
It’s totally understandable, and we get it. Plus we want to get you top dollar as that is one of our goals as your listing agent.
Let’s start by considering who may want to preview your home & ultimately make an offer.
Typically, most buyers have a budget. They may also be preapproved with a lender for a budget.
When buyers start shopping, they do so by their budget. When buyers hire agents, the agent also sets up the search criteria by the budget.
If your property comes on the market and it’s overpriced, buyers who are searching for your type of property may not be alerted to your new listing, because the new listing alert will not be sent to them because the pricing is out of their budget bracket.
Next, their agent will probably not be alerted to the new listing because their alerts for this specific buyer and their budget will not hit their radar.
With that said, we always do a huge marketing push with a new listing so everyone is alerted to the new listing whether they are set up on searches or not. We also call our buyer database and buyer agent colleagues to tell them about the new listing.
When a property first hits the market, this is when it will get the most action because this is when we as seller agents push out all of the new marketing. This time is critical.
The first two weeks is when your property will get the most action because it’s a new listing, a new product and anyone waiting for something new, will call to see it.
Why don’t buyers just look and then lowball?
First, if you are not within their budget price point, they may not even be alerted via online listing alerts or their agent’s listing alerts. Second, if the price is too high, they will figure they cannot afford it and just move on. Plus I have to tell you that most experienced buyers’ agents will tell their clients that your pricing is too high and that you are probably not a realistic seller.
Making offers can be a time-consuming process for the buyers and their agent. They want to spend time making offers on properties they can actually afford to buy and those where they feel the seller is motivated to sell.
There are also a lot of other essential steps to selling such as hiring an experienced agent, professional photography and marketing; these allow you to get the most money in today’s market and help you to best position the property amongst your competition.
At the end of the day, pricing is still the number one factor in selling quickly and often for top dollar.
Everyone wants to get top dollar, we get it as we work with sellers every day. However testing the market is not always a good strategy. It’s important to know the comparables of your specific property.