I have heard it many times from many clients. “We’re happy with where we’re priced. Buyers can always just make us an offer!” implying that the seller is willing to significantly discount their price during negotiations, but not wanting to reflect that willingness in their list price. But do buyers really make offers on properties that are over-priced? The statistics say not very often.
Price is a funny thing when it comes to potential buyers. A buyer typically won’t offer on a property, even if they like it, if it isn’t in their price range, especially when they have lots of other properties to choose from. Even if they think the true market value is in their price range, they still usually won’t bother to make an offer because the list price signals to them that the sellers are not interested in coming down to their perceived market value. The typical buyer doesn’t want to get emotionally involved in a property that they perceive they have little if any chance to acquire at a satisfactory price.
The statistics bear this out. For the 347 homes that have sold on the Monterey Peninsula in the last 6 months, the average percentage off the list price is 7%, and a full ¾ of these homes sold within 10% of the list price. These numbers back up what I typically tell my clients, that it is important to price your property at least within 10% of an honest opinion market value, if not closer. Today’s market of steady, or even declining values, and a tremendous inventory of homes for buyers to choose from, makes pricing your home properly from the start that much more meaningful.