Some Owners Have ‘Seller’s Market’ Misconceptions

“Aspirational pricing” doesn’t work well in any real estate market. Buyers will risk a bidding war only if they first see some level of value.

CHICAGO – The housing market is hot, but some homeowners overestimate how hot it is when they go to sell. Real estate professionals shared a few unrealistic expectations with that their sellers had, such as that their home “doubled in value since they bought it” or they “shouldn’t have to make any repairs before closing.”

“One of the biggest mistakes sellers can make is going with aspirational pricing just because it is a seller’s market,” says Jeremy Bolger, a real estate salesperson with Brown Harris Stevens in New York City. “We have seen many deals get multiple offers and go at or over ask, but they almost always stem from buyers sensing some form of value. And if there is no perceived value, buyers will often stay on the sidelines, even with limited inventory.”

Not everything will sell for a price far above list price or as quickly as in a few days – or mere hours – even in a hot housing market. Real estate pros said some sellers believed their home would sell in a few days and became disappointed when it didn’t. Some homes – often ones that need some repairs, list in a higher price range or have quirky features – still often linger on the market, notes.

Also, even in a seller’s market, homeowners still need to make repairs. Investors may be willing to overlook some needed updates, but many buyers still want a move-in ready property, agents say.

“If the seller has a place that needs a touch-up or decorative work, it’s usually a good idea to do it ahead of listing,” Bolger says. “Construction and renovation costs are up sharply with all the supply chain issues. Buyers can be wary of purchasing a place that they will have to do work on, especially since the money spent there needs to be fully out of pocket, versus buying a move-in-ready product and having everything rolled into the mortgage.”

Source: “6 Home-Selling Hopes and Dreams That Can Easily Turn Delusional,”® (Dec. 13, 2021)

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