Selling a home can be a long and emotionally challenging process. One of the most critical factors in ensuring a successful sale is setting the right price. Here’s why pricing your home correctly is so vital.
While many sellers aim to maximise profit by overpricing or try to attract more buyers by under-pricing, both strategies can backfire, ultimately hindering the sale. At Winkworth, we advocate for realistic pricing to facilitate a smooth and timely home sale.
Why realistic pricing is key
While September saw a boost in market activity due to lower mortgage rates, properties are still taking an average of 60 days to find a buyer—three days longer than last year, according to Rightmove. This indicates that the market remains cautious and highly price sensitive. In some areas demand outstrips supply, keeping prices competitive, but setting a realistic price remains crucial to securing a sale.
Charlie Rosling, Head of Sales at Winkworth Hyde Park, Paddington and Bayswater emphasises the importance of realistic pricing. Charlie told us “The common denominator with all recent sales is realistic pricing and ‘getting your ducks in a row’ with any decorating and legal paperwork. If you set the right recipe from the outset, a successful sale will follow.”
Similarly, Nick Martiny-Roberts, Director of Winkworth Leamington Spa, states that despite ongoing economic challenges, well-presented, accurately priced homes in Leamington Spa and Warwick have continued to achieve close to or full asking prices, particularly in the sub-£800,000 market.
Understanding house prices
Many homeowners tend to overestimate the value of their property, which can lead to unrealistic expectations. While online research is a useful starting point for understanding property prices, it often lacks the depth and local market insights that estate agents bring to the table. Experienced agents use their knowledge of recent comparable sales and the housing market to provide a more realistic and informed valuation.
Some sellers may base their asking price on a neighbour’s listing, not considering that most homes don’t sell for their original asking price. Additionally, sold prices on Land Registry data can be up to three months old—during which time the market may have shifted. For a timely and successful sale, an up-to-date, accurate price is essential.
Common pitfalls in pricing
Overpricing
Many sellers fall into the trap of overvaluing their homes due to emotional attachment or unrealistic market expectations. Failing to account for current market trends and conditions can lead to prolonged listings, as potential buyers are deterred by the high price. Even if the market shows signs of recovery, overpriced homes often stagnate, leading sellers to eventually lower the price, possibly missing out on early opportunities for a quicker, more profitable sale.
In October 2024, Zoopla reported that a fifth of homes listed for sale remained unsold, with many sellers reducing their asking prices by 5% or more to attract buyers. This underscores the importance of setting a realistic price right from the start, as buyers remain highly price sensitive.
Under-pricing
Conversely, under-pricing your home to attract a wider range of buyers can backfire. Buyers may perceive a lower price as a sign that something is wrong with the property, such as hidden flaws or an undesirable location, causing them to lose interest in the home.
Reduce time on the market with realistic pricing
Setting an accurate price for your home increases the likelihood of attracting serious, motivated buyers. When potential buyers see that your property is priced fairly and competitively, they are more likely to schedule viewings, which increases your chances of receiving offers and completing a sale.
Accurate pricing also shortens the time your home spends on the market. Homes priced too high tend to sit unsold, leading to price reductions and potentially delaying the sale even further. By setting the right price from the start, you avoid unnecessary delays and price cuts, streamlining the process.
Additionally, competitively priced homes are more likely to receive multiple offers, creating a sense of urgency among buyers and driving up demand. This improves your chances of securing a sale at or near your asking price.
Conclusion
Accurate pricing is essential to a successful and timely sale. By setting a fair, competitive price, you’ll attract serious buyers, minimise time on the market, and increase your chances of receiving competitive offers.
*In the first half of 2024, Winkworth achieved the highest conversion rate from new instruction to exchange of £1 million+ homes among the top 10 estate agents in London, a testament to our in-depth market knowledge and accurate pricing strategies. (*TwentyEA, Based on data from 1st January 2024 to 7th July 2024. The top 10 estate agents in London are ranked by the number of new instructions during this period.)
