Note to Sellers: Careful About High Listing Price

You’ve been approved for a Florida mortgage loan and now you’re trying to figure out the best negotiation strategy for making an offer. We’ve gone over the fine line buyers must walk when they confront a desired property.

But what about sellers? They also need to consider strategies for how homes are priced, especially as options such as auctions haven’t proven very successful. Because of the change in real estate market conditions, more sellers are competing for fewer buyers. Therefore, it’s a good time to counter this popular myth:

The initial listing price isn’t that important because the price can always be adjusted down later.

WRONG!

The approach of buyers

If most Florida mortgage shoppers first viewed your house because of a newspaper ad, a magazine, the Internet, brochures, or the sign in your front yard, the initial listing price probably would not make a difference. After all, the house would always be “new” to those seeing it and negotiating could begin after they looked it over.

But most buyers do NOT come to your house because of various types of advertising. They rely on Florida real estate agents to find them a property that matches what they can afford - so it’s easy to imagine what would take place if yours was overpriced from the beginning. It would often be overlooked.

Scarcely anyone actually buys a home based on an ad. Consequently, , you need to get other agents interested in your property, and this is where a seller’s listing agent comes in. They must make sure buyer’s agents list your house in their searches … and this won’t occur if your initial asking price is too high. There will never be time to negotiate for a compromise if no one includes your home on their list, especially in this buyer’s market.

The listing of new homes

New listings are on the “hot” sheet circulated in real estate offices. The MLS computer identifies these listings and, with agents looking at newly listed homes so aggressively, a properly priced home gets attention. An overpriced home gets passed over.

Remember that buyers aren’t thinking in advance about how much you’re willing to negotiate. They can only afford a Florida home mortgage loan for a certain amount and are comparing your asking price to others out there.

Moreover, when your house is new on the market, you may not be willing to negotiate as much as you will later, once you’ve realized your error. Keep in mind that statistics show, quite often, the first offer is the best offer.

As time passes, you could actually become desperate to sell because you’ve accepted a new job or because you have already bought a new home. This then becomes a recipe for receiving lowball offers, meaning you could end up selling for less than if you had priced the home correctly in the first place.

It’s all important to keep in mind as you consider your selling strategy. In this state, you aren’t in control. Those with a Florida home mortgage and knowledge of the market can dictate prices if you aren’t careful.