Although things have become slightly more normal in terms of real estate activity over the last few months, make no mistake: it is still a seller’s market out there. Demand outpaces supply and transactions are still taking place at a rapid pace. In such a market, a seller can do no wrong, right? Not at all. This is perhaps one of the trickiest times for sellers, especially if they think the market gives them a carte blanche to price wherever they want.
The greatest risk for sellers in this market is overpricing. Never has it been more important to do extensive due diligence on comps from every angle: location, amenities, size and condition. How do you, as a seller, know if you’ve overpriced your property? If you’re not in contract 3 weeks into the listing’s life, or have multiple competing offers, then you’re above the market. It used to be that properties would become stale after 3-5 months on the market. Based on the robust activity over the last few years, “stale” is now defined as any property not swooped up after a mere month on the market. That’s right folks: a one month old apartment raises major read flags for buyers and their brokers, alike.
Just a quick look over on StreetEasy, tells a similar story. Here you see lackluster properties with over 100+ people tracking each. They’re just waiting for the right price to pounce on these babies, and have a set price in mind for what that “right” level might be. And these properties are scrutinized far more carefully once they become stagnant, paying what we think of as a “price of aging” penalty; buyers will often look for that extra compensation for the staleness factor, thinking something must be wrong with it on some level, making the property less desirable than the average.
Bottom line to sellers: yes, this is your time, but don’t mess it up. Price correctly and you will celebrate; over-price and your bank account will most certainly feel it.