The short answer is Yes. Definitely yes. Why? You may ask. Well, let’s back up a minute. I’m sure you’ve heard it’s a seller’s market, but what does that mean? It means there are currently more buyers than there are sellers in the open market (in this case the housing market). Because of the disparity between supply and demand, prices rise. Interest rates are still historically low, younger generations are buying their first home earlier than other generations because the see the value in buying versus renting.
Now normally this “problem” is partially offset with new construction. But in a pandemic with inflated cost of construction materials (among other things), new builds are not happening quickly enough to make a dent in buyer demand. So, like any other human being, a seller wants to seller their house for as much as someone is willing to pay for it (market value). And when there are less available houses than there are buyers, the price that a buyer is willing to pay starts to rise across the board. You certainly have outliners, where someone pays way more than anyone else is willing to just because they can (and more than likely have gotten frustrated with losing house after house). But, mostly, all buyers are willing to pay more than they would have 12 months ago for the same house, because that’s what the market will bear. If buyer A doesn’t pay it, buyer B will. So, in order to be competitive, buyer A decides they will pay it. However, there is a limit to what the market will bear as long as there is Some competition in the marketplace, which there is. Even though it’s not much. Not much competition for sellers because of so few houses available compared to the number of buyers looking.
So, can your house be overpriced in this market, yes. Finding that sweet spot is still the name of the game when pricing a house. That price point that creates a sense of urgency. You want buyers to walk in and say, I need to make an offer quickly if I want this house because if I don’t someone else will. No matter what the market, that is the goal. Which is why it’s smart to have someone advise you. There is more to it than just looking at what your ambitiously priced neighbor listed their house for. What’s your layout like, is it dated, do your neighbors fill their lawns with junk, is your 5 acres straight up the side of a mountain, is your road crazy busy with traffic, what is buyer behavior telling us currently in this market And where is the market heading. And even though seller’s have a lot of power right now, there are still houses that sit for longer than average. And there is no problem with a house that price won’t fix.
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