“Let us start with a higher price per square metre and reduce it later.”
At first glance, this may seem like a sensible strategy. We set a higher price, leave room for negotiation and try to achieve the best possible result.
In practice, however, something very different usually happens.
Buyers may not consider your property at all
Buyers can now easily compare a large number of similar properties. Before arranging a viewing, they already have a general idea of what their budget can buy.
When a property is priced significantly above its realistic market value, serious buyers will often not even consider it.
They will not necessarily call to make a lower offer. They may simply move on to the next listing.
An excessively high price does not always create more room for negotiation. It often only reduces the number of people who will consider the property at all.
The property remains on the market for months
Interest in a property is usually highest immediately after it is listed.
This is when the listing first reaches buyers who are actively monitoring the market and looking for a property with similar characteristics.
When the initial asking price is unrealistically high, that first wave of interest may be lost. The property can then remain listed for weeks or months without receiving any serious offers.
Over time, it begins to lose its appeal.
Buyers begin to have doubts
When buyers see the same property listed for months, they often begin to wonder:
- why it has not yet been sold;
- whether there is a problem that has not been mentioned in the listing;
- how much the owner is actually prepared to reduce the price;
- whether it would be better to wait for a further reduction.
Even when the price is later adjusted, the listing no longer has the same effect as when the property first entered the market.
Buyers who previously dismissed it may not return, while others may expect the price to continue falling.
A realistic price can produce a better result
The goal should not be to set the highest possible price, but one that reflects the property’s actual market value.
A well-calculated initial asking price:
- attracts a larger number of serious buyers;
- increases the number of enquiries and viewings;
- generates interest immediately after the listing is published;
- increases the possibility of receiving multiple offers;
- reduces the amount of time the property spends on the market.
When several buyers express interest at the same time, competition is created between them. This can result in a better final sale price than listing the property for months at a price the market will not accept.
Paradoxically, a more realistic initial asking price can sometimes produce a higher final sale price.
Pricing should be part of the sales strategy
Pricing a property is not about guessing or choosing the amount that sounds most appealing to the owner.
The property itself, its location, legal status, condition, competing listings and current demand must all be analysed.
Based on this information, an asking price can be established that positions the property correctly on the market and attracts the buyers it genuinely suits.
A free property valuation
Are you unsure what price you should set?
Contact us. We will analyse your property and current market conditions and provide you with a realistic pricing recommendation within the next few days.
