Spotting an Overpriced Home
Posted On: Feb 28, 2017
Buyers have a lot to worry about when buying a new home. An inflated purchase price should definitely not be one of them! Before making an offer on your dream home, be sure you can spot whether it’s overpriced. Read on to identify signs and warnings that should raise eyebrows.
Price the Neighborhood
The more research you do on the neighborhood, the easier it is to identify an overpriced home. Hop online and do some price comparisons of nearby homes. Of course, you want to find a property very similar to the one you are considering. Pay attention to square footage, number of bedrooms/bathrooms, and lot size when selecting comps to compare. If the home you are pining over is priced considerably over other comps in the immediate area, the home may simply be overpriced.
Days on Market
Time of year plays a factor in the amount of time a home will sit on the market, but if a home has been unsold for over 60 days, that may an indicator that it is overpriced. There are a number of factors that affect the sale of a home, but often price is the number one reason a home won’t sell.
No Offers or Scheduled Showings
This may seem obvious, but if a home is on the market and buyers are not interested in viewing the home or making an offer, it is probably because they feel it is overpriced. Usually sellers will experience a flurry of traffic within the first week of listing. If this does not happen, or the interest dies quickly, this may be a sign that the price needs to drop to meet consumer expectations.
Too Many Bells and Whistles
Extra features or unnecessary amenities are a huge red flag indicating an overpriced home. Often sellers will raise the listing price of their home to make up the cost of expensive renovations or upgrades made before the decision to sell, or the owner may have been neglecting important maintenance that was necessary to show a home and are looking to recoup some of the cost.
A combination of two or three of these red flags may be cause to reconsider making an offer just yet. Depending how eager you are, you may want to entertain the idea of waiting for the price to drop to match reasonable expectations or throwing in a lower offer. Just be prepared for a negative response from the seller. Happy house hunting!