When setting a list price for your home, you have to choose a number that’s likely to attract buyers and that will hopefully earn you a profit. Sometimes homeowners don’t take their real estate agent’s advice and insist on a higher asking price than the agent recommended. In other cases, a house doesn’t sell as fast as the agent and seller anticipated because of changes in the local real estate market or in the overall economy, or for some other reason. Under those circumstances, it may be necessary to reduce the asking price to sell a property.
Your Agent Tells You That Your House is Overpriced
Understanding the local real estate market is critical when selling a house. Real estate agents have access to a wealth of information on houses in the same area. They can compare square footage, numbers of bedrooms and bathrooms, amenities, list prices, sale prices and time on market for numerous properties.
If your agent tells you that homes similar to yours are selling for less than your list price and that houses selling for the amount you’re asking are larger, more modern, or in better condition than yours, that means that it’s unlikely that you will get the amount you’re asking for. If your agent provides data on comparable home sales and recommends that you lower your price, listen.
You Haven’t Gotten Any Offers
If few people have expressed interest in your house, that may be a sign that you set the asking price too high. If your home has generated interest, but no one who has viewed the house has placed an offer, that likely means that they thought the list price was not in line with the house’s features and condition.
Prospective buyers have probably looked at several other houses in the area. They may have found that yours didn’t stack up to others in the same price range and that your asking price wasn’t justified.
The Offers You Have Gotten Were Below Your Asking Price
If you have received one or more bids, but they were less than your list price, that may mean that the amount you’re asking is too high. Talk to your real estate agent about the recent sale prices for comparable homes nearby and ask if your house is overpriced.
It may be a good idea to accept a low bid, or at least to use it as a starting point to negotiate. If you already passed on a lowball offer, you may realize that the amount was reasonable and that you should ask for a lower price moving forward.
Price Your Home to Sell
Reducing the asking price may help you generate new interest and finally sell the property. Setting a lower price may attract multiple offers, and you may wind up selling your home for more than the reduced price.