4 Reasons Your Realtor Overpriced Your Listing

Your Realtor works to get you the best offer on your home. With that being understood, you may become confused as to why he or she is listing your property for more than its value. It may concern you that the property will not move due to the overpricing. Rest assured that Realtors use this tactic as a means to bring potential buyers to the table. Here are the top four reasons a Realtor overprices a home. 

1. You Have an Improved Property

Realtors tend to look for improvements that will set your home apart from similar properties in the neighborhood. These improvements can also help to justify the pricing associated with the property. Improvements such as converting an office space into an additional bedroom can create an amenity that was not originally there. The overpricing can help offset money spent on your behalf to add the improvement.

 2. Original Price Is Too High

At first glance it does not make sense to overprice a property whose original asking price is already too high. However, a Realtor will overprice a home whose original price is too high to find a good middle selling price. Often, a situation like this occurs when the seller has an attachment to the property or is testing to see if someone is willing to pay the asking price.

3. Negotiation

The main reason for overpricing is to create negotiation space. By overpricing a property, a Realtor opens up negotiation space for the seller to achieve her bottom-line asking price. Negotiation is the key for any real estate transaction. A seller wants to get the value of her home plus any appreciation. A buyer wants to get a property at a reasonable price and feel that he has gotten his money's worth. Overpricing can create the necessary platform for both parties to walk away with their needs met.

4. Unrealistic Expectations on Your Part as the Seller

Often times, a Realtor will overprice a home because of the seller’s unrealistic sense of her property's value. In order to accommodate a client, the Realtor will overprice a home. If the property does not move, then the Realtor hopes that the seller will reduce the price of the property.

Pitfalls

While overpricing can be a good tool when trying to get a positive return on your property, it can also be a reason the property does not sell. Buying agents will look at the price, amenities, comparable properties and how many days the home has been on the market to determine if the price is justifiable. If the price is not deemed justifiable, your property may not sell and may sit on the market for months. When determining how to price your property, your realtor should make sure that the price can be justified and that it is attractive to the buying public. In addition, you must have realistic expectations. Overpricing may not guarantee a sell, but it can help to gauge a selling price.

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