“I just suffered through six months of having my home for sale, and it didn’t sell. I’m sure it’s because my agent over-priced my home. Why would an agent do that?”
Could be one of many reasons:
— 1. Honest Mistake —
Agents are human. I’ve overpriced a few homes in my 30+ years as an agent. But I monitor feedback from agents and prospective buyers and suggest a reduction if I discover we’re priced too high.
— 2. Lack Of Experience/Skill —
Just because someone has a real estate license doesn’t mean they know what they’re doing! (See the Homebuying Question above.)
— 3. Unique Home —
I’ve priced homes with spectacular views, unique décor and upgrades, on busy streets, with converted garages, etc. It can be tough to attach a price tag to these features. Can you tell me if a sweeping ocean view is worth 100K, 200K, or 500K?
— 4. Fluctuating Market —
When market values are rising or falling quickly, it can be tough price a home accurately.
— 5. Misguided Desire To Please —
Believe it or not, many agents will tell an owner a higher figure to please them. Totally illogical, but it happens a lot.
— 6. Bait & Switch —
This one really ticks me off. Over my career, I’ve advised homeowners hundreds of times on what the value of their home is. Then another agent waltzes in and tells them an inflated figure just to get them to list with him/her. I watch the listing in the MLS and see that either it doesn’t sell, or after many months and several price reductions it finally sells at or often below the price it should have. Years ago, an agent I know even told me, “I come in high to get the listing, then hammer the price down later.” Not ethical.