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The Number One Mistake Sellers Are Making: Overpricing Their House

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In today’s housing market, many sellers are making a critical mistake: overpricing their houses. This common error can lead to a home sitting on the market for a long time without any offers. And when that happens, the homeowner may have to drop their asking price to try to re-ignite buyer interest.

Data from Realtor.com shows the number of homeowners realizing this mistake and doing a price reduction is climbing (see graph below):

No Caption ReceivedIf you’re thinking about making a move yourself, here’s what you need to know. The best way to avoid making a costly mistake is to work with a trusted real estate agent to find the right price. Here’s a look at what’s at stake if you don’t.

Not Paying Attention To Current Market Conditions

Understanding current market conditions is key to accurate pricing. You don’t want to set your asking price based on what happened during the pandemic. The market has moderated a lot since then, so it’s far better to align your price with today’s reality.

Real estate agents stay updated on market trends and how they impact the pricing strategy for your house.

Pricing It Based on What You Want To Make (Not What It’s Worth)

Another misstep is pricing it based on what you want to make on the sale, and not necessarily current market value. You may see other homes in your neighborhood selling for top dollar and assume yours can do the same. But you may not be considering differences in size, condition, and features. For example, maybe that other house is waterfront or has a finished basement. To sum it up, Bankrate explains:

“How do you find that sweet spot of pricing for profit but not overpricing? The expertise of your agent can be truly valuable here. A knowledgeable agent will understand fair market value in your area, how much your house is worth and how much you might reasonably expect to get for it in the current market.”

An agent will do a comparative market analysis (CMA) to make sure your house is compared with truly similar properties to get an accurate look at how it should be priced.

Pricing High to Leave Room for Negotiation

Another common, yet misguided strategy is to price your house high on purpose, so you have more room to negotiate down during the sale. But this can backfire. A price that seems too high often deters potential buyers from even considering the home. So rather than leaving room for negotiation, what you’ll actually be doing is turning buyers away. U.S. News Real Estate explains:

“You want to sell your house for top dollar, but be realistic about the value of the property and how buyers will see it. If you’ve overpriced your home, chances are you’ll eventually need to lower the number, but the peak period of activity that a new listing experiences is already gone.”

An agent can help you set a fair price that attracts buyers and encourages more competitive offers.

Bottom Line

Overpricing your home can have serious consequences. A knowledgeable real estate agent brings an objective perspective, in-depth market knowledge, and a strategic approach to pricing.

Connect with a local real estate professional to avoid making a pricing mistake that’ll cost you.

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Agent Value

Expect the Unexpected: Anticipating Volatility in Today’s Housing Market

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You’ve probably noticed one thing if you’re thinking about making a move: the housing market feels a bit unpredictable right now. The truth is, from home prices to mortgage rates, we’re seeing more volatility – and it’s important to understand why.

At a high-level, let’s break down what’s happening and the best way to navigate it.

What’s Driving Today’s Market Volatility?

Factors like economic data, unemployment numbers, decisions coming out of the Federal Reserve (The Fed), and even the presidential election, are creating uncertainty right now – and uncertainty leads to market volatility.

You can see that when you look at what’s happening with mortgage rates. New economic reports and other geopolitical events have an impact and can cause sudden shifts up or down, even though experts still forecast rates will come down overall. We’ve seen that effect play out recently, like when employment and inflation data get released each month.

And as the markets react, these types of updates will continue to have an impact on rates moving forward. As Greg McBride, CFA, Chief Financial Analyst at Bankrate, says: 

“After steadily declining throughout the summer months, I expect more ups and downs to mortgage rates . . . Job market data will be closely watched as well as any clues from the Fed about the extent of upcoming interest rate cuts.”

This is exactly why the projected decline in mortgage rates isn’t going to be a straight line down over the next year. As Hannah Jones, Senior Economic Research Analyst at Realtor.com, explains:

“Rates have shown considerable volatility lately, and may continue to do so . . . Overall, we still expect a downward long-term mortgage rate trend.”

Plus, home prices and the number of homes on the market vary dramatically depending on where you’re looking to buy or sell, which makes it even harder to get a clear picture. In some areas, home prices are rising and inventory is tight, while in others, there are more homes available and it’s leading to more moderate pricing shifts.

As all of this unfolds, understanding what’s happening will help you make the right decisions, whether that’s buying or selling. And there’s one easy way to get that information: from a professional.

The Importance of Partnering with a Pro

While the road ahead may have some bumps and unexpected turns, you don’t have to go it alone. A great agent will keep you up to date on the latest market developments, guide you through any shifts, and help you make smart decisions based on your goals.

For example, as mortgage rates change, professionals (like your agent and a trusted lender) will explain how the shifts impact what you can reasonably plan for in your monthly payment. This will help you see how even a small change in rates can impact your bottom line – that way you don’t lose sight of the big picture even as shifts happen here and there.

And since conditions can vary significantly from one neighborhood to another, your agent will also help you understand the specifics of your market—whether it’s how to navigate competition with other buyers, the number of homes available, or what’s happening with local home prices. Their insights and expertise will help you adapt to any movement in the market.

Bottom Line

The housing market may be experiencing some shifts, but don’t let it stop you from making your move. With the support of an experienced real estate agent and a trusted lender, you’ll be ready to navigate the changes and make the most of the opportunities that come your way.

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Agent Value

How Real Estate Agents Take the Fear Out of Moving

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Feeling a bit unsure, or even afraid, to move with everything going on right now? The decision to move shouldn’t be scary, it should be exciting. And the best way to eliminate any fear is to work with a pro. 

Real estate agents are so much more than just transaction facilitators; they’re trusted guides to help you navigate the complexities of the housing market with confidence and ease. And a great agent can turn what may feel like a daunting process into a manageable—and even enjoyable—experience.

That’s why, in a Bright MLS survey, respondents agreed partnering with an agent is essential and helps cut down on their stress:

a blue pie chart with white textHere are just a few examples of why that expertise can give you so much peace of mind.

1. Explaining the Current Market

You may be seeing misleading headlines about a potential market crash, falling prices, and more. And when you’re not an expert yourself, it’s easy to get swept up in the clickbait and let that scare you. As Jason Lewris, Co-Founder and Chief Data Officer at Parcl, says:

“In the absence of trustworthy, up-to-date information, real estate decisions are increasingly being driven by fear, uncertainty, and doubt.”

A real estate agent is there to help you separate fact from fiction and to debunk any headline that does more to terrify than clarify. With their deep understanding of local market trends, home values, inventory levels, and more, they’ll help you feel more confident in your decision.

2. Walking You Through the Process Step-by-Step

Is this your first time going through the process as a buyer or a seller? Don’t worry. Your agent will walk you through every step along the way, from the initial conversation all the way to closing day. As NerdWallet explains:

“If it’s your first time buying — or selling — you’re likely to come across terms you don’t recognize and tasks that seem baffling. What’s the difference between pending and contingent? Why do you need title insurance? How thoroughly do you need to fill out disclosure forms? Your agent should be able to confidently and competently explain it all.”

And if you’ve done this before, but it’s been a while, an agent will tailor how they explain it all to your previous experience. They won’t bog you down with details, they’ll only give you as much of a refresher as you want and need.

 3. Advocating for Your Best Interests

Does the thought of dealing with the back and forth of the transaction make your palms sweaty? Put that anxiety aside. Your agent is a skilled negotiator trained for these exact scenarios. And the best part is, they work for you. So, it’s your goals they’re using that expertise to fight for.

They’ll work to secure the best possible terms for you, whether it’s getting a better price as a homebuyer or negotiating a higher sale price as a seller. This removes the fear of a bad deal or being taken advantage of during the process.

4. Solving Any Unexpected Problems Quickly

Worried something is going come up that you don’t know how to handle? Rest assured, your agent has you covered.

Agents are skilled problem-solvers. They not only address issues, but they get ahead of them before they become deal-breakers – and that helps keep the process on track. So, if any challenges do pop up, know your agent has the skills and experience necessary to find a solution that works for you.

Bottom Line

Don’t let fear or uncertainty hold you back from achieving your goals. With an expert agent by your side, you can move forward with confidence. 

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Economy

Why Home Sales Bounce Back After Presidential Elections

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With the 2024 Presidential election fast approaching, you might be wondering what impact, if any, it’s having on the housing market. Let’s break it down.

Election Years Bring a Temporary Slowdown

In any given year, home sales slow down slightly in the fall. It’s a typical, seasonal trend. However, according to data from BTIG, in election years there’s usually a slightly larger dip in home sales in the month leading up to Election Day (see graph below):

a graph of a person with an orange squareWhy? Uncertainty. Many consumers hold off on making major decisions or purchases while they wait to see how the election will play out. It’s a pattern that’s shown up time and time again, and it’s particularly apparent for buyers and sellers in the housing market.

This year is no different. A recent survey from Redfin found that 23% of potential first-time homebuyers said they’re waiting until after the election to buy. That’s nearly a quarter of first-time buyers hitting the pause button, likely due to the same feelings of uncertainty.

Home Sales Bounce Back After the Election

The good news is these delayed sales aren’t lost forever—they’re just postponed. History shows sales tend to rebound after the election is over. In fact, home sales have actually increased 82% of the time in the year after the election (see chart below):

a blue and white chart with numbersThat’s because once the election dust settles, buyers and sellers have a sense of what’s ahead and generally feel more confident moving forward with their decisions. And that leads to a boost in home sales.

What To Expect in 2025

If history is any indicator, that means more homes will sell next year. And based on the latest forecasts, that’s exactly what you should expect. As the graph below shows, the housing market is on pace to sell a total of 4.6 million homes this year, and projections are for 5.2 million total sales next year (see graph below):

a graph showing the sales of a companyAnd that aligns with the typical pattern of post-election rebounds.

So, while it might feel like the market is slowing down right now, it’s more of a temporary dip rather than a long-term trend. As has been the case before, once the election uncertainty passes, buyers and sellers will return to the market.

Bottom Line

It’s important to remember that while election years often bring a short-term slowdown in the housing market, the pause is usually temporary. Those sales are not lost. Data shows home sales typically increase the year after a Presidential election, and current forecasts indicate 2025 will be no different. If you’re waiting for a clearer picture before making a move, just know that the market is expected to pick up speed in the months ahead.

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The information contained, and the opinions expressed, in these article are not intended to be construed as investment advice. Let's Talk Real Estate and Keeping Current Matters, Inc. do not guarantee or warrant the accuracy or completeness of the information or opinions contained herein. Nothing herein should be construed as investment advice. You should always conduct your own research and due diligence and obtain professional advice before making any investment decision. Let's Talk Real Estate and Keeping Current Matters, Inc. will not be liable for any loss or damage caused by your reliance on the information or opinions contained herein.