Lessons in Real Estate Pricing

Jonathan Dalton, Phoenix Real Estate AgentA couple of days ago I posted what I thought was a clever if basic video that delivered an important if basic message: if you want your real estate to sell, be it here in Phoenix or anywhere else these days, don’t overprice it.

Some, such as Phoenix’s own Lord Voldemort, felt it was demeaning to you my non-real estate agent readers to post such a video. If you actually did feel that way, you have my apologies.

But I don’t think you did.

We’re all (relatively) logical people. We all know that for a home to sell it needs to have a competitive price attached. As I sit in sellers’ living rooms and we discuss other homes in their neighborhood, whatever that neighborhood may be, they’re incredibly brutal honest in their assessment of their neighbors’ homes and their attached asking price.

But the necessary objectivity disappears when we discuss our own homes.

That is what causes sellers to choose one agent over another simply because the other agent was more open to a higher-than-market list price despite the lack of backyard landscaping and other upgrades. It’s what causes a seller facing a trustee’s sale to raise their list price by $10,000 the day after it’s placed on the market, even if it makes the home unsellable.

It’s the instinct that causes most sellers, when comparing their home to those around it, say to themselves (or their agent), “but my house is better.” I’ve yet to have anyone say the reverse.

Three years ago we dismissed recent sales because homes were selling for much more. A year or so ago we dismissed Active listings because they represented what sellers were hoping to sell for, not the actual market value of their homes. These days we look at the actives ahead of recent sales to try and get ahead of the decline.

No one is accusing sellers of being stupid, regardless of the hand-wringing of a handful of misguided would-be moralists. Subjective to a fault, absolutely. Stupid, no.

Don’t overprice your house is a message that simply can’t be said often enough. Some will listen. Some will not. Which group do you suppose will sell their homes?

[tags]real estate marketing, real estate pricing, Phoenix real estate[/tags]

Jonathan Dalton

Jonathan Dalton is a 40-plus-year resident of the Valley and has been helping folks buy and sell homes since 2004. He can be reached at 602-502-9693 or info at allphoenixrealestate.com.


  • Jeff Brown 10 years ago

    I still maintain — only those sellers for whom correct pricing is an unwanted trip to the land of reality, will be offended.

    It’s at that point the video begins to show it’s intrinsic value. They show themselves as offended, and you get to walk away from 3-6 months of wasted time and who knows how much aggravation.

  • Howard Arnoff 10 years ago

    The video was not insulting, it was cute. If you want to sell your house, price it right. How simple is that.

    Did you know that according to Wikipedia, “in a 2006 BigBadRead poll, British students voted Lord Voldemort their favourite literary villain of all time.”