5 Signs that your House Is Overpriced

Luke Constantino | June 1, 2007

Have you walked around some residential neighborhoods lately? Sometimes you can see 5 houses for sale on the same block... Since Last Year!!!

A home can be a source of debt or wealth. Many people want their homes to pay their bills or to buy up to a better place. Let's take into account that it really doesn't matter what you think your house is worth. What matters is what the bank appraiser who is going to give the buyer a mortgage thinks its worth. Here's a little known fact: they come to us for a comparative market analysis on similar homes in your area. We guide them on the prices of homes. You should always listen to a respected Realtor about the price range of your home, and not your neighbor down the block.

Your House Is Overpriced when:

1. You call a few Realtors and they don't want to take the listing.

Realtors (skilled ones) know the FMV (fair market value) in your area. They are experts in their field and make a living from selling property. If they see you will not comply to the market and they know your house is overpriced, they will not waste their time and move on.

2. You don't get a legitimate offer in 4 - 6 weeks of listing it.

Usually when a house is properly priced, advertised, show ready, photographed and put on the MLS (Multiple Listing Service), it takes a very short time to get a legitimate offer, sometimes a few. If you don't get any in 4-6 weeks, there's something terribly wrong

3.Very few people come to your open house.

Buyers are a lot smarter and have more tools available when house shopping than they did years ago. They are computer savvy. I've seen people come to open houses with lists generated from the internet. One thing a buyer will not do is waste time... Yours or theirs. You'll probably just get curious neighbors, browsers and someone who came for the free cookies and coffee.

4. The houses around you sell more quickly.

Just recently I have seen this happen. The 5 houses on one block I told you about? It's a real block in my neighborhood. As soon as one of the sellers lowered his price and sold, 3 others followed suit. They sold soon after. There is one stubborn homeowner with a "For Sale" sign on his lawn that has changed real estate companies so much he probably doesn't even know his Realtor's name... Some people never learn.

5. You lose money by paying a mortgage which could have been profit.

As soon as you put your property on the market you are racing against time. Time will take the money that you could have made and put it towards the mortgage of the same house you are trying to sell quickly. Overpricing your property is a lose/lose situation.

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