What Your Friends and Neighbours Tell You Should NOT Set Your List Price
Selling a home is likely one of the most significant financial transactions you will make in your lifetime — and one of the most emotional. You’ve built memories within those walls. You’ve invested in upgrades, improvements, and finishes that felt right for you and your family’s needs. You know what this home has meant to you, and naturally, we attach a dollar value to memories and want that, knowingly or unknowingly, reflected in the listing price.
Buyers don’t want to pay for your memories.
Buyers can’t feel your attachment to the backyard where your kids grew up, or the personal renovations that are exactly the way you wanted them. What they see is a house — one they’re hoping to turn into their own home — and they’re evaluating it against everything else available to them on the market right now.
That gap between what a home means to a seller and what a buyer is willing to pay is where over-pricing can go wrong. And when pricing goes wrong, it costs you.
“I want room to negotiate”
One of the most common conversations I have with sellers goes something like this: “But if I list at that price, I have no room to negotiate.” The sounds perfectly logical to you — but the math doesn’t work in your favour.
Overpricing doesn’t create negotiating room — it creates hesitation. Buyers today are informed and it is at their fingertips. They’ve done their research. They have lists, they know their data and if they are looking in your specific area you can bet they know what every home on your street sold. They understand market value better than ever before. If they feel a home is priced above market value, they don’t rush to make an offer and negotiate down. They move on. Or they wait.
You want to capitalize on a buyer’s initial excitement — when a home sits, the days on market creep up, and that number makes buyers start to wonder why. When they wonder why, they start to tell themselves a story about what may be “wrong”, or assume a seller is stubborn and steadfast in that price. Buyers pay attention.
“I want to see what I can get”
I’ll be direct here because I think sellers deserve honesty: putting an overpriced home on the market to “test the waters” when you’re not truly committed to selling is disrespecting everyone’s valuable time. Your time. The buyers’ time. Their agents’ time. My time.
Buyers who tour your home and fall in love with it — only to find it is priced out of reach and worse, you aren’t willing to negotiate — walk away frustrated. That frustration doesn’t turn into an offer. It can leave them feeling negatively about your property and their agent will encourage them to move on.
If you’re not ready to sell at market value, it’s okay to wait until you are. But listing with fingers crossed is not a strategy. The question “Do you want to sell your house or have a house for sale?” is appropriate here.
The reality of improvements
You spent money on a renovation. You know exactly the why and the what of your choices. Your investment was real and it was significant — and I understand why you want it reflected in your price.
But here’s what the market tells us consistently: not every buyer wants a home finished to your taste. Over-improving for a particular neighbourhood or expecting a buyer to reimburse you dollar-for-dollar for renovations they didn’t choose and may not have chosen themselves, is one of the most common reasons homes take longer to sell, or seller’s receive offers less than asking and take it personally. The reality is, a home will sell for what a qualified buyer is willing to pay.
Updates and improvements absolutely add value — but that value is determined by the market, not by the receipt.
“I won’t accept anything less than $X”
This is perhaps the most difficult conversation in real estate — when a seller who genuinely needs to sell has a firm number in their head and the market won’t support. The emotional commitment to that number can override what would, in any other financial decision, be a logical and analytical decision. Holding out can cost in terms of days on market, additional mortgage payments, utilities, and buyers moving on and away from our home.
Needing to sell and refusing to price accordingly is a contradiction and the market will always win out — just not always in the seller’s favour.
Pricing is the most important piece of the puzzle
To sell a home, you need to get people through the door. To get people through the door, your price needs to make sense to the buyers scrolling listings online at midnight, for example, comparing and scrutinizing your home to six others they’ve bookmarked and listed in a similar price point.
Buyers have options. When your home is priced right, it competes. When it’s overpriced, it sits — and a home that sits starts to carry a stigma and stigma can cost you in time and money.
It is an agent’s responsibility to price a listing honestly, even when that conversation is uncomfortable. You have decided to work with a Realtor® for their expertise, it’s your responsibility to listen and trust their advice.