Issue Date: February 11, 2007

Don't Scare Away Your Buyers

By Jody Zink
Licensed Realtor in Ohio & Michigan

The location may be excellent and the condition may be stellar, but if a home's been sitting on the market a while, the common perception is there's something wrong with it. The number one reason why an otherwise attractive home doesn't sell? It's the price. Homes that are grossly overpriced often never sell at all. That's because buyers won't write offers on them. With so much to choose from, why would they? Buyers write on the well-priced homes first.

A common mistake for sellers is thinking, “They can always make an offer.” While that is true, first the buyer must actually know about the house. Pre-approved buyers know how much they can spend and usually go online to search, typically by price. If your home is listed even a cent over that amount, the buyer may never see your home. You may even be willing to take $20,000 less, but it wouldn't matter. If buyers are sticking with a budget, they start with a reasonably priced home to write on.

Why won't buyers make offers on an overpriced listings? They don't want to offend the seller. They mistakenly think the seller knows the home is priced too high and that if he was willing to accept less, the seller would just lower his price. Buyers also assume the seller must have turned down low-ball offers, since surely someone, somewhere along the line, probably offered the seller a reasonable price. In many cases, there are no other offers.

A former boss once explained it to me this way. Somewhere between one dollar and a million, someone, somewhere, will buy that home. They key, of course, is finding the breaking point to maximize proceeds. Pricing reasonably spurs interest and activity. And a seller's ideal is a multiple offer situation to drive up the price. It makes sense. A friend of mine sold stuff on eBay for a while to pay the bills. He learned that a higher starting bid didn't necessarily bring more money in the end. He typically got more for an item if he started the bid a $1 and let the market decide.

From the time the sign goes in the yard, studies show the best marketing activity happening within the first three weeks. Wasting your best marketing time on an overpriced house, won't likely get you the result you want. The last thing you want is to scare buyers off. Your home's first exposure to the market can be the most crucial. Price it right the first time.

Jody Zink is a licensed REALTOR in Ohio and Michigan with the Loss Realty Group. Her column appears every other week in the Toledo Free Press. She can be reached at jody@jodyzinkrealtor.com or 419-725-1881.