Here is a typical example of what can occur when a home is priced too high in a competitive market:
When a home sits on the market for a long time a buyer may think the seller is getting desperate or there is something wrong with the home.
The buyer will offer a very low price, knowing that it will be considered.
Market time: 16 months
List price: $100,000
Maintaining Expenses*: $13,000
Buyer negotiates: $6,000
Net to seller: $73,440
When a home is priced correctly it’s more attractive to buyers than homes that are in the same price range. Buyers will be more inclined to hurry and buy it because it’s new on the market and won’t last!
Market time: 3 months
List price: $85,000
Maintaining Expenses*: $2.400
Buyer negotiates: $2,000
Net to seller: $74,300
The seller would receive $860.00 more in the second scenario by pricing competitively!
* mortgage interest, insurance, utilities, taxes, etc.
** commission, transfer tax, title insurance, etc.