In today's market, more than in the past ten years, price is the single most important part of getting a house sold.  In the past, if the realtor and owner did not price it right, and with a rising market, the market could catch up to an overpriced listing.  In today's market, if a house is priced above market value, and with a declining real estate market, it is sort of like trying to catch a ball that is rolling downhill and has a headstart.  You simply end up chasing the market all the way to the bottom.  When a house is priced correctly, it will get offers.  When the offer comes in, it is up to the realtor and the owner to determine if it is a good offer at or close to market value, or if it might be an investor hoping to pick up a real bargain.  If the offer is at or near market value, the seller would be wise to accept it, or at least make a legitimate counter-offer.  Failing that, a good buyer will simply move on to the next opportunity because in this declining real estate market, there is no shortage of good opportunities.

Here are a couple of examples.  In an executive community in Palm Harbor, FL there are only two houses listed for sale, both are very nice homes that the owners appear to have overpriced relative to what the market is willing to pay.  One is listed for $409,000 and has been on the market for 336 days.  The other is about the same size only without a pool, is prices at $329,900 and has been on the market for 279 days.  It would appear that the real estate marketplace is saying, loud and clear, that both of these houses are overpriced for today's market.

In another community in Oldsmar, FL, there are three houses listed for sale, one under contract and two sales in the last 60 days.  The average price per square foot of the sold houses was $110.  The average price per square foot for the houses listed for sale is $121.  These houses are also executive quality homes.  Although the three houses listed for sale have been on the market for 90 days or less, the indications are that the prices for them is above market value.  If they are not generating offers, the prices are too high.  The average price for the sold houses in this community is $242,500.  The average list price for the houses listed for sale is $297,633.  A $55,000 difference is another clue that the listed houses are higher than the real estate market value for this community. 

If you would like to get a feel for the market value of your home, click on the photo of deer in the community of Bay Arbor, FL and then visit the Market Snapshot on the right side of the page.

Deer in Bay Arbor, FL

An example of what can happen when a good house is priced correctly is this.  We listed a short sale, in very good condition, at the lower end of the real estate market value yet still within the market value range.  Within a weekend, there were four competing offers and the seller accepted an offer 8% ABOVE the list price.  Considering it is a short sale, and selling it so quickly for more than the list price, the seller is very happy.  Of course the caveat here is that the bank needs to understand it is a good offer too.  Had the seller listed this property at the high end of the market value, it very likely would linger on the market with few if any offers, and the offers might well be far below market value.

When a seller gets an offer from a buyer that is "not what I need to get", and refuses that offer, the seller is effectively buying their home and beating out the competition.  If a seller has had 5 offers, and declined all of them, that seller has simply repurchased his house 5 times over and is sitting on the sidelines while the real estate market is continuing to drop.

The message is, do not overprice you house or you will end up either sitting on a white elephant (as far as the real estate marketplace is concerned) or when you eventually do sell the house, you will net much less than you would have had the price been correct in the first place.