The Costly Pricing Trap Every Smart Homebuyer Can Avoid

For homeowners looking to sell, pricing strategy is one of the most important decisions. Unfortunately, many sellers fall into the trap of "wishful pricing"—listing their homes at inflated, aspirational prices rather than pricing based on market reality.While one might assume inflated listing prices affect only the buyer, the pricing mistake affects both buyers and sellers alike.Here's how sellers can avoid this pricing mistake, and how buyers can use data to back lower offers and avoid overpaying when facing aspirationally priced listings. How to avoid overpricing your homeTo ensure your home is priced accurately before it hits the market, your real estate agent should perform a comparative market analysis (CMA). A CMA is a detailed report that estimates a home’s value by comparing it to recently sold similar homes (comps) in the same area.The CMA should analyze recent sales, not listing prices, for homes currently on the market. Looking at recent sales is the best strategy because it provides a clearer picture of realistic prices rather than hopeful pricing.Gary Lanham, Realtor® and broker associate at Gary Lanham Group, says he encounters wishful pricing fairly often."The proble...