How to Price Your Home for Sale: Why It Matters More Than Ever
When it comes to selling your home, one of the most critical decisions you can make is setting the right asking price. In 2024, the Halifax Regional Municipality (HRM) housing market is dynamic, and the data reveals some interesting trends. Out of all single-family detached homes sold this year, 48.86% sold under the asking price, 41.36% sold over asking, and only 9.78% sold at the listed price.
These statistics raise an important question: Why is pricing your home properly so essential?
The Risks of Underpricing
In today's market, it's not uncommon to see homes sell for significantly over asking price. Some sellers (and their agents) intentionally price low to ignite bidding wars, thinking they’ll create excitement around the listing. While this may occasionally work, underpricing can have drawbacks.
Here’s why:
Unrealistic Buyer Expectations: A low price may attract more buyers initially, but it can leave them frustrated when they’re priced out in a bidding war.
Damaging the Industry's Reputation: As one local real estate agent pointed out, this tactic can tarnish the reputation of real estate professionals. With immigration and interprovincial moves down, most of today's buyers are local. Pricing homes artificially low doesn’t create trust, especially when nearly half of the homes are still selling for less than their original asking price.
Lack of Transparency: Buyers are becoming savvy, and when they see homes selling over asking by significant margins, it leads to feelings of discouragement. This is especially frustrating in an environment where affordable housing is a growing concern.
The Consequences of Overpricing
On the flip side, pricing your home too high can also backfire. As we’ve seen in HRM this year, 48.86% of homes sold for less than their asking price. This suggests that some sellers may have started with unrealistic expectations.
Here’s what can happen when you overprice:
Extended Time on Market: Homes that are overpriced tend to sit on the market longer. The longer a home sits, the more buyers start to wonder, "What's wrong with it?" which leads to fewer showings and potentially larger price reductions.
Price Reductions and Missed Opportunities: Eventually, most sellers have to lower their price to align with market realities. By that time, you may have already missed out on serious buyers who passed on your property because it was out of their price range.
Seller Fatigue: The process of continually lowering your price or explaining to potential buyers why your home hasn’t sold can be exhausting.
The Importance of Pricing It Right
So, how do you find the sweet spot? The goal is to price your home at or near market value from the start. Here’s why it works:
Attract the Right Buyers: Pricing correctly ensures you’re attracting serious buyers who can afford your home. This leads to quicker offers and less back-and-forth.
Competitive Advantage: In a market where 41.36% of homes are selling over asking, having a realistic price can still generate excitement and multiple offers—without the risk of discouraging buyers with an artificially low listing.
Saving Time and Energy: Homes priced right from the start spend less time on the market. That means less stress for you and quicker negotiations.
Final Thoughts
The HRM market shows us that nearly half of homes sold are closing below asking price. This highlights a need for better pricing strategies from the outset. Setting the right price matters now more than ever—not just for a quick sale, but for maintaining trust with buyers and ensuring you’re getting the best possible outcome.
Work with a knowledgeable real estate professional who understands the market and can guide you through the pricing process. A well-priced home is not only a reflection of its value, but also of the strategy behind the sale. Let’s get it right the first time.
