How you price your home is one of the most critical factors affecting how quickly it sells (often referred to as Time on Market, or TOM).
Here’s a breakdown of the relationship:
Strategies for a Quicker Sale
The general rule for a fast sale is to price the home competitively or even slightly below market value.
-
Attracts More Buyers: A competitive price instantly increases the pool of potential buyers who view the listing, especially those using online price filters.
-
Generates Urgency: Pricing just right can create the perception of a great deal, which often leads to increased interest, more showings, and—most importantly—multiple offers and bidding wars.
-
Drives Up Final Price: In a competitive bidding scenario, the final sale price is often driven above the initial asking price, sometimes netting the seller more than if they had listed high initially.
-
Psychological Pricing: Listing a price just under a threshold (e.g., $499,000$ instead of $500,000$) can make the home appear more affordable and draw in buyers searching a lower price bracket.
The Cost of Overpricing
Overpricing is the number one cause of a home lingering on the market.
-
Misses the Initial Buzz: A home gets the most attention in the first few weeks it is listed. An overpriced home will be overlooked by the most serious, active buyers during this crucial period.
-
Stigma of Time on Market (TOM): The longer a home sits unsold, the more buyers (and their agents) assume there is something wrong with the property, even if the only issue is the price. This can result in:
-
- Fewer showings.
- Lowball offers when an offer finally does come in.
-
Deeper Price Cuts Later: Studies show that homes that linger often require significant price reductions to finally sell. For example, a home on the market for two months might sell for 5% less than its original list price, while a home that sells quickly may only be discounted by 1% (or sell above list).
In short, the trade-off is clear:
| Pricing Strategy | Time on Market (TOM) | Potential Final Price |
| Competitive / Slightly Below Market | Shortest (Days/Weeks) | Maximized (often leads to bidding wars) |
| At Market Value | Moderate (Weeks) | Realistic (close to list price) |
| Above Market Value | Longest (Months) | Lowered (requires price cuts and sells below initial list) |
Image: Canva Pro