When selling a house people make some very common mistakes which not only hurt the chances of their house getting sold but also push them to lower the price eventually and sell it at a loss. Selling a house is complex and requires you to consider certain things before putting your house on the market. It is important to know how much your house actually costs and how much you can make over the original price.
Overpricing your house is a gamble, which will most probably do you more harm than good as the higher the price the longer you will have to wait for a potential buyer to agree to it.
The problems which overpricing will cause include:
Pushing potential buyers away
Due to the high price of your property, most potential buyers will choose to overlook your house altogether and opt for one which they can easily afford. You should be looking to attract maximum buyers for viewings, not the opposite.
Comparison between available houses
When a buyer compares your high priced house and another houses priced at market value, he/she will most likely go for the one which is priced at market value. This is why many home owners fail to sell properties which are not competitively priced.
Another thing which needs to be remembered here is that lenders these days order an appraisal well before funding a mortgage, which leaves no reason as to why anyone would price his/her house more than its actual worth. You need to understand the market situation. If there are more houses out there, then buyers will have a wide variety to choose from and they will obviously go where there is the most value for money.
Houses that stay in the market for too long become stigmatized, forcing the buyers to ask why the house has been on the market for so long. This will lead to negative publicity and may even force you to lower the price considerably.
High price low motivation
High price leads to low motivation in potential buyers to pursue a house, compared to a more reasonably priced one.
High priced houses often sell cheap
Once you have set the asking price, you will not be able to drop it without attracting negative publicity. If your house stays in the market too long, you might have to sell it lower than its actual value to get it off your hands.