The Dangers of Overpricing in San Francisco Real Estate
As will be illustrated in this report, overpricing one’s home prior to going on market almost always has negative ramifications for sellers: Across Bay Area markets, listings that require price reductions before selling consistently take much longer to sell and sell for significantly lower average values than homes priced correctly. The correct calculation of “fair market value” typically has large economic consequences. Conversely, overpriced homes can provide opportunities for buyers who carefully track time on market and price reductions (as well as homes taken off the market without selling), and react accordingly. Such buyers will almost always face reduced competition from other buyers – often no competition, which generally eliminates the need for overbidding – and allows for more aggressive negotiation of the purchase price and terms of sale.
Pertaining to residential real estate sales in San Francisco County. Analysis performed in good faith with data from sources deemed reliable, but may contain errors and subject to revision. All numbers should be considered approximate. How these analyses apply to any specific property is unknown.
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