Overpricing Your House
Virtually every person who decides to sell their property believes that the property is worth much more than what it actually is.
The reason for this is usually because the neighboring properties have sold for a certain amount or Estate Agents have convinced the owner that the property is worth the inflated amount.
Unfortunately some unscrupulous Estate Agents attempt to win favor with the owner or to obtain a Sole Mandate by inflating the price of the property. Many Estate Agents have a strategy to overprice so that they can get a Sole mandate. This means that no other Estate Agent may market the property until the Sole mandate has expired.
The problem with overpricing a property is that it will not sell at the exaggerated price no matter how much advertising or marketing money is thrown at it. The positive impact that a new property on the market could have had will be lost if overpriced. No Purchaser will pay more than what a property is worth. In fact, the only person who really decides what the Property is worth is the eventual purchaser. The price that the owner wants is a wish list and the price that the Estate Agent provides is his or her best estimate based on all the relevant facts and knowledge.
An overpriced property may remain on the market for an extended number of months. This means that the Seller will have to continue to service the bond, pay rates and taxes, pay insurance and water and lights. The potential purchasers are all comparing Properties by going to show houses and by visiting various websites. They know exactly when a Property is overpriced, and not one of them will purchase the property. Overpricing attracts the wrong buyers because the Property is overpriced. For example, if the Property is only worth ฿2m, and it is being marketed at ฿2.5m, then the ฿2m buyers will not be showing an interest as they don’t know that the Property is overpriced, and the ฿2.5m buyers won’t pay the exaggerated price either.