When looking for the right home to purchase, something that you may be faced with at some point is determining if the house you are considering purchasing is in fact an overpriced home. There are so many factors that go into purchasing a home. There are also a myriad of factors that go into determining list price for a house. It’s important to try to cut through these factors in order to tell if you are faced with an overpriced home.
One of the major issues when it comes to listing a home is the sentimentality factor. Since your house is the place that your children took their first steps, you experienced major milestones and put a lot of work (and money) into, sellers may often struggle with pricing their house realistically when it comes time to sell.
One of the things to consider if you are in the market to buy, is the number of days a home has been on the market. Although not always the case, but often the longer a house is on the market, there better the chance that it is an overpriced home. Houses that are sharply priced often do not last long on the market. Those with unrealistic price expectations tend to remain unsold.
In real estate, the most active period is when a house first hits the market. The longer it stays on the market, it may often become ‘stale’ and somewhat of a forgotten commodity. Another thing to consider is the condition of the home. Simply pricing the house comparably to other houses in the area is not always a clear indication of the true value of a home.
Needless to say, some houses are in better condition than others (for a variety of reasons). Just because houses ‘appear’ to be similar in terms of size, number of beds/baths, etc., this is not always a clear indication of the value of the house. Simply pricing a home due to expectations on the current market may lead to an overpriced home. Finally, consider the local area. Busy streets, poor access to schools or shopping and low income in the area can suppress the value of a house. Just because a home has all of the amenities within its walls doesn’t necessarily mean that it is 100% compatible to other homes in more favourable neighbourhoods.
There are many things to identify when attempting to determine if you are faced with an overpriced home. Try to keep these factors in mind to help along the way.
