buyers will just make an offer right
Why Overpricing Does Not Encourage Buyers to Negotiate
Overpricing doesn’t matter to some home sellers in Sacramento because sellers who knowingly overprice a home often have a hard time putting themselves into the shoes of a home buyer. No matter how much they try to squeeze size 10 1/2 feet into those size 9 shoes, they are still walking in the shoes of a seller. They make decisions as a seller and hope a buyer will see things the same way, when buyers do not.
When I talk with sellers about overpricing and why they need to reduce the price to a point where a buyer will make an offer, they’ll fallback on an old wive’s tale, which is not true. They will say, but a buyer can just make an offer, right? Any offer, and I will negotiate. They know that right?
No, they don’t know that. And further, they won’t do it. They don’t want to insult the seller or cause hard feelings. They might even believe the seller is stubborn, too stuck on the price, and to try to negotiate would be an embarrassment, not to mention a complete waste of time. Buyers don’t want to feel uncomfortable when negotiating. They just want to buy a home.
I realize sellers have a hard time believing that. But it’s absolutely true. I know it’s true because I’ve seen it happen over and over during my 40-plus years in this business. But some sellers still think it’s a good idea to jump on the overpricing strategy and then cross their fingers that buyers will lowball. This type of thing might work well in a classroom but not in real life, not in Sacramento real estate.
The people who are comfortable writing lowballs are the guys who won’t budge much. They’ll write a lowball on as many as 100 properties a day, hoping one of them will stick. It’s the principle of throwing enough crap at the wall until something grabs a hold. Those are not the guys these types of sellers want to sell to.
If you’re considering overpricing, at least have a plan for a price adjustment if things don’t work out. Generally speaking, if you don’t receive an offer in Sacramento within the first 30 days, you are priced too high.