Real Estate 101 - Dangers of Overpricing in Charlotte Home Sales

This weeks entry into the Real Estate 101 series covers something I've seen happening in the Charlotte Real Estate Market lately.  In the past week alone, nearly 1200 listings have had a price reduction, meaning they initally listed too high.  I wanted to discuss how being overly-optimistic in regards to list price can have a detrimental effect on selling your home.

Inclining prices give potential buyers more courage to purchase, which leads to more buyers and more competition. This situation often causes home sellers have a tendency to overprice their listing, which can be ill-fated. Below is the effect of overpricing your Charlotte NC property for sale.

Connection Between Home Price and Listing Timeframe

It is a well known fact that home price and marketing time are linked. Overpriced homes require more time to sell for several reasons. First, higher price points match the criteria of fewer buyers. Secondly, high priced listings make lower-priced listings more appealing. Thus, you will actually help other listings sell their properties first.  Lastly, potential buyers are more critical as the price increases. Your property should have obvious justification for the high price or buyers will lack interest.

Listing Time and Sale Price

Another known pattern is that longer marketing times result in lower selling prices. Buyers negatively view houses that do not sell quickly. They infer that there must be issues with the property (and not simply that it was overpriced).

Additionally, as a seller, you will usually drop the price as time passes.  Even if you drop the price to the correct level, it is usually too late to eliminate the damage. Buyers interested in the property will usually submit lower offers than they initially might have. In the end, your home will sell for less due to being overpriced at the start.

(Never a good idea to feature a photo with a shredded American Flag either...)

The Effect Of Overpricing Your Charlotte NC Property For Sale

The effect of overpricing your Charlotte NC property for sale is both time and money. It is that straightforward. Even if the market is active and bidding wars are common, overpricing has no upside. It is always important to begin at the correct price.  This brings about the most interest, improves demand and yields maximum value. Contact an experienced real estate agent who knows the market and proper pricing strategies to ensure that you do not make the mistake of overpricing.