When selling your home, it is natural to try and get the best price possible from the sale and this can lead to the temptation to overprice the property compared to the local market for similar properties. There can be many valid reasons for adding to your sale figure, such as realising that there might be a negotiation so pricing the property higher could mean that, after any negotiated deduction you still get the price you want; you might feel that your property is a cut above the average property in the area and as such deserves a higher selling price. Whatever your reason for wanting to overprice your house, here are some things to consider before you go down that route.
Pricing your property at the highest possible end of the market is likely to cause the sale to take significantly longer. Typically, a buyer will carry out an on-line search first and would input a maximum value. If you are priced outside of this, then fewer buyers will see your property and so you will, by default get less viewings. Add to this the fact that, even if your property does pop up, it will be unfavourably priced for the local market, potentially putting buyers off. This reduction in potential buyers means it will take longer to sell and this has a knock-on effect. If your property is on the market for longer than normal, buyers will be suspicious and might steer clear, leading to even fewer viewings. The longer your property is on the market the higher the chance that, if you are buying another house yourself, the purchase of your new property will fall through.
Even if you do secure a buyer at the higher price, you could be causing issues later down the line. As part of a mortgage process, there is a valuation survey. If this comes out significantly lower than your asking price, the mortgage lender might refuse to lend on the property causing the sale to fall through. If the sale of your property drags on for too long you might find that your own mortgage offer is no longer valid. Typically, mortgage offers are only valid for 3 months, if your sale takes longer then you might need to re-apply for your mortgage, adding more risk and further delays to the process.
Ultimately the price at which you are willing to sell your property for is down to you as an individual, but it always makes sense to take the advice of your agent who will know what the local market is like and what a realistic price is for your property. Whilst tempting to get as much profit as you can, it does not come without risks. At Newton Fallowell we have over 30 sales and lettings offices across the Midlands, and the local property knowledge that comes with over 20 years of being in business. If you are ready to sell your home, you can book a realistic in-home market appraisal of your property here