How Does Selling Above Market Value Work on the Gold Coast?
Selling a home above market value on the Gold Coast typically backfires, as buyers quickly lose trust when a property is clearly overpriced.
While aiming high can seem tempting, an unrealistic asking price will scare off serious buyers, drag out your sale, and ultimately force you to accept a lower offer than if you’d priced it right from the start.
Selling property on the Gold Coast is an exciting but often challenging task. Setting the right price is a critical factor in the success of your sale. But what happens when you aim too high?
UNDERSTANDING MARKET VALUE
What Is Market Value?
Market value is the price at which a property is expected to sell in a competitive market. It reflects the current conditions, including demand, recent sales, and the property’s unique features.
On the Gold Coast, factors such as proximity to the beach, local amenities, and the overall desirability of the suburb heavily influence market value.
How Market Value Is Determined on the Gold Coast
Determining market value on the Gold Coast involves analysing recent sales data, comparing similar properties, and considering local market trends.
Real estate agents use a Comparative Market Analysis (CMA) report to arrive at an accurate market value, ensuring that your property is competitively priced to attract serious buyers.
WHY SELLERS OVERPRICE PROPERTIES
The Desire for Maximum Price
One of the primary reasons sellers overprice their properties is the desire to achieve the highest possible price. This mindset often leads to unrealistic pricing, as sellers may hope that someone will pay a premium for their property.
However, this approach can backfire dreadfully, leading to longer time on the market and eventual price reductions.
Misunderstanding the Market
Some sellers overprice their properties because they misunderstand the current market conditions. They might believe that their home’s unique features justify a higher price or that the market will continue to rise indefinitely.
Without proper guidance, this can result in setting a price that is out of step with what buyers are willing to pay.
The Influence of Emotions
Emotional attachment to a property can also lead to overpricing. Sellers who have lived in their homes for many years may place a higher value on personal memories and experiences, which don’t translate into market value.
This emotional bias can make it difficult to accept a fair market price.
IMMEDIATE EFFECTS OF OVERPRICING
Initial Buyer Interest and Its Decline
When a property is first listed, it often attracts attention, especially if it is well-marketed and presented. However, if the price is too high, initial interest can quickly fade as potential buyers compare it to other, more reasonably priced options.
This drop in interest can be swift and dramatic, leaving the property lingering on the market for an extended period.
Impact on Online Listing Metrics
In today’s digital age, online listings are a critical part of selling property. Overpriced listings often suffer from poor click-through rates, fewer inquiries, and reduced overall engagement.
These metrics are key indicators of buyer interest, and when they are low, it becomes harder to generate momentum for a sale.
LONG-TERM CONSEQUENCES OF OVERPRICING
Extended Time on the Market
A property that stays on the market for an extended period can become a burden. Not only does it tie up resources, but it also signals to potential buyers that something may be wrong with the property.
The longer a home sits unsold, the less likely it is to fetch a high price.
The Stigma of a Stale Listing
When a property doesn’t sell quickly, it can develop a stigma. Buyers typically assume that there is an underlying issue, whether it’s with the property itself or with the seller’s expectations.
This stigma can be difficult to overcome, even with price reductions and new marketing efforts.
Financial Strain Due to Overpricing
Holding out for a higher price can lead to financial strain, especially if the property remains unsold for months. Sellers may face ongoing mortgage payments, maintenance costs, and other expenses.
In some cases, these costs can erode any potential gains from an eventual sale.
PSYCHOLOGICAL IMPACTS ON BUYERS AND SELLERS
How Overpricing Deters Serious Buyers
Overpriced properties often put off serious buyers. They may perceive the seller as unrealistic or unmotivated, leading them to avoid the listing altogether.
This can result in fewer offers and less competition, ultimately leading to a lower sale price.
Seller Frustration and Stress
Overpricing can also take a toll on sellers. Watching your property sit on the market with little interest can be incredibly frustrating.
This stress can lead to poor decision-making, such as refusing to adjust the price or accepting a lowball offer out of desperation.
STRATEGIES TO RECOVER FROM OVERPRICING
Recognising the Need for a Price Adjustment
The first step in recovering from overpricing is recognising the need for a price adjustment. This can be a difficult decision, but it’s often necessary to reignite buyer interest.
By aligning the price with market value, you can attract more serious buyers and increase the chances of a successful sale.
Best Practices for Price Adjustments
When adjusting the price, timing is crucial. A well-timed price reduction can generate new interest and even lead to multiple offers.
It’s essential to consult with your real estate agent to determine the best approach, taking into account factors such as recent sales, current listings, and buyer feedback.
The Role of a Real Estate Agent in Repricing
A knowledgeable real estate agent can be invaluable in repricing a property. They can provide valuable insights into market trends, offer strategic advice, and help you navigate the complexities of adjusting your pricing.
Their expertise can make the difference between a prolonged sale process and a quick, successful transaction.
TIPS FOR SETTING THE RIGHT PRICE FROM THE START
Conducting a Comparative Market Analysis (CMA)
One of the most effective ways to determine the right price is by conducting a Comparative Market Analysis (CMA).
This involves comparing your property to similar homes that have recently sold in the area. A CMA provides a data-driven foundation for pricing, helping you avoid the pitfalls of overpricing.
Consulting Local Market Trends and Data
Staying informed about local market trends is essential when pricing your property. On the Gold Coast, factors such as seasonal demand, economic conditions, and new developments can all influence pricing.
By understanding these trends, you can set a price that aligns with current market conditions.
Leveraging Professional Staging and Marketing
Professional staging and marketing can significantly enhance the appeal of your property, making it stand out in a competitive market.
Staging helps showcase the property’s potential, while effective marketing ensures it reaches the right audience. Together, they can justify your asking price and attract serious buyers.
OVERPRICING YOUR HOME: A COSTLY MISTAKE
Is overpricing your home as detrimental as it seems? Unfortunately, it is.
My FREE mini e-brochure, “What happens when you try to sell Above Market Value?”, details the experience of an Ashmore homeowner who attempted to sell their property $80,000 above market value using 21 different real estate agents over four years.
Another local Gold Coast homeowner aimed high with an “Offers over $2 million” price tag, only to eventually sell for $1,635,000 after nine months on the market.
Despite overwhelming initial interest, the severe overpricing ultimately cost them $215,000.
Don’t let overpricing sabotage your property sale.
Careful Consideration
Selling a property on the Gold Coast requires careful consideration of market value. Overpricing might seem like a way to maximise profit, but it can lead to extended time on the market, financial strain, and stress.
By understanding the factors that influence pricing and working with a knowledgeable real estate agent, you can set a competitive price that attracts buyers and leads to a successful sale.
FAQs
Q. What are the risks of overpricing on the Gold Coast?
The risks include extended time on the market, reduced buyer interest, financial strain, and the potential stigma of a stale listing. Overpricing can also lead to fewer offers and a lower final sale price.
Q. How does time on the market affect sale outcomes?
The longer a property stays on the market, the less desirable it becomes to potential buyers. Extended time on the market can lead to price reductions and may result in the property selling for less than its true market value.
Q. Can an overpriced property be successfully repriced?
Yes, an overpriced property can be successfully repriced, but it requires a strategic approach. Recognising the need for a price adjustment, consulting with a real estate agent, and timing the reduction carefully is key to reigniting buyer interest.
Q. What role does staging play in pricing strategy?
Staging plays a crucial role in showcasing the property’s potential and justifying the asking price. A well-staged home can attract more buyers and create a stronger emotional connection, making it easier to achieve a higher sale price.
Q. How can a real estate agent help in setting the right price?
A real estate agent can provide valuable insights into local market trends, conduct a Comparative Market Analysis (CMA), and offer strategic advice on pricing. My expertise ensures that your property is competitively priced to attract serious buyers and achieve a successful sale.
THIS IS HOW YOUR JOURNEY TO A SUCCESSFUL GOLD COAST PROPERTY SALE STARTS
My simplified guide below will take you through a 20-step process for selling your property anywhere on the Gold Coast;
I proudly sell homes across the entire coast.
1. PREPARING YOUR GOLD COAST PROPERTY FOR SALE + SOME OF THE LEGAL REQUIREMENTS
- Tidying gardens and decluttering everything inside and out.
- All homes for sale, are legally required to have hardwired photoelectric, interconnected smoke alarms.
Non-removable 10-year battery smoke alarms can be installed as an alternative.
- By law, you are required to complete a pre-contractual seller’s disclosure statement: generally related to limitations, restraints, or defects in the property title, such as easements, covenants, leasing, zoning, etc.
- A pool safety certificate is also required if you have a swimming pool or if the property has a shared swimming pool (Body Corporate).
2. COMPARATIVE MARKET ANALYSIS REPORT FOR YOUR GOLD COAST PROPERTY
After showing me around your property, I will provide you with a Comparative Market Analysis (CMA) report. This is a detailed, legally required analysis of your home’s market value.
The CMA is based on recently sold and for-sale properties similar to yours in the immediate area. I will need to view your home to prepare this report.
3. SETTING A MARKETING BUDGET FOR YOUR GOLD COAST HOME
The third step in selling your home is to create a marketing budget.
By law, this must be based on actual costs.
There are various marketing options to consider, such as:
– Internal, External and Drone Photography.
– Property and House Plans show potential buyers the exact layout of your home and property.
– Internet Advertising on platforms such as RealEstate.com.au, Domain.com.au, Facebook.com, Instagram.com, etc.
– For Sale Sign on the street is still essential to attracting potential buyers. Even though many buyers start their search online, they often drive around neighbourhoods to see what’s available.
A simple fact: Not having a For Sale sign can significantly reduce the number of people who see your property and may be interested in buying it.
4. PREPARING AND APPROVING THE FORM 6 AGREEMENT WHEN SELLING A GOLD COAST PROPERTY
A Form 6 Agreement is a document provided by the Queensland State Government. It outlines all relevant details of the property sale, including the marketing budget.
Our administration team will prepare this form for you and send it for your review and approval.
5. PAYING THE MARKETING BUDGET FOR YOUR GOLD COAST PROPERTY
Once you have approved the Form 6 Agreement, the next step is to pay for the marketing budget that you have chosen.
6. STARTING THE ADVERTISING PROCESS
Once your payment is received, the advertising campaign will commence.
Advertising strategies will align with the choices you made within your marketing budget.
7. MONITORING MARKET RESPONSE
If your property hasn’t received offers within 30 days, don’t assume there’s no interest.
It often means the price isn’t aligned with what buyers are willing to pay at this time.
This is your signal to review and adjust your pricing strategy so your home remains competitive and receives the attention it deserves.
8. ARRANGING BUYER VIEWINGS
When buyers express interest in your property, viewings will be arranged to allow them to see your home in person; you need to be away from the property during these viewings.
This helps potential buyers feel relaxed and visualise themselves as the new owners, thereby forming a deeper connection with your property.
9. CONSIDERING A BUYER’S OFFER
When you receive an offer on your home, it means a buyer is serious and ready to move forward at a certain price.
This is a key moment in your selling journey. Take the time to go over the offer carefully.
Look beyond the price; check the terms, conditions, and settlement timeframes. Make sure it works for you before accepting, countering, or declining.
10. ACCEPT, COUNTER, REJECT
When an offer is presented, you will need to respond by accepting, countering, or rejecting it.
Accepting locks in the agreed-upon price and terms.
Countering proposes changes and initiates further negotiations. If countering, present revised terms clearly; open, respectful communication is key for a smooth sale.
Rejecting means the offer is unacceptable; in this case, respond promptly and professionally, explaining your reasoning for the decision.
11. YOUR LEGALITIES
When you finally accept an offer, you will engage your conveyancer or solicitor to facilitate the legal requirements to complete the sale.
If you are part of a Body Corporate, you will need to provide a Disclosure Statement from them.
Your solicitor will use PEXA to settle your property. Part of the process requires Verification of Identity. Also, anyone selling a property must complete an ATO Clearance Certificate.
12. BUYER’S DEPOSIT
The buyer’s deposit is a crucial step in the property purchase process; it will be held in the agency’s Trust account.
This is a tangible expression of the buyer’s commitment to purchase your property.
13. BUILDING AND PEST INSPECTIONS
Typically, a buyer will arrange for a building and pest inspection report to be completed, usually within 14 days of the contract date.
Additionally, they may have the contract subject to finance, which is generally applicable for 21 days from the contract date.
14. COMPLETING YOUR GOLD COAST PROPERTY SALE
Based on the outcome of the building and pest inspection report, as well as any finance being sought, the buyer will proceed with their offer or withdraw it.
At this point, the sale either falls through or becomes unconditional.
15. LOOKING FOR YOUR NEW PROPERTY
If the sale becomes unconditional, it is time to start looking for a new property. Remember, there is no need to rush.
It is essential that you take your time, as this needs to be a very considered purchase.
Your new home is of substantial value and can be costly if you change your mind. Something you may want to investigate is Short-Term Bridging Loans.
16. ALTERNATIVES YOU SHOULD CONSIDER
An alternative to seriously consider when deciding where to live between selling and buying is renting while you look for a new property.
Renting for a short period gives you breathing room; it allows you time to clear your head, make a confident, considered decision, and ultimately buy where you truly want to live, with no pressure or panic.
17. TIME FOR YOU TO MOVE
Leaving your home opens doors to a new chapter full of new beginnings. Embrace the excitement of a fresh start and cherish the memories you’ve made.
Every box you pack brings you one step closer to a new adventure full of possibilities that lie ahead.
18. YOUR SALE CONCLUDES
The culmination of the property sale is settlement; it marks the transfer of the property to the new buyer.
As the final chapter concludes, this marks a sense of achievement: your property has now SOLD.
19. YOUR FUTURE OPTIONS
If you have chosen to rent, you will continue to look for and eventually purchase a property, apartment, or perhaps even buy land and build; now there’s something to consider.
20. TIME TO UNWIND AND MAKE YOUR NEW HOME YOUR OWN
As you unpack and furnish your new home, embrace the gradual process of creating your haven.
Enjoy the transformation, one room at a time.
Relax in the tranquillity of your surroundings and immerse yourself in the gentle sounds of your new neighbourhood.
Explore the nearby parks and cafes; enjoy the unique charm of your new community.
Remember, settling in is a journey in itself; it’s not a race. Embrace the process of creating a home that reflects your unique style and personality.
Whether you’re downsizing, relocating or just ready to move on, I’ll guide you through every step of selling your Gold Coast home with confidence and ease.
Navigating the intricacies of selling your property can be complex, but it doesn’t have to be.
My 20-step guide provides a simplified general overview; as you would naturally expect, your steps may vary.
Author – Craig Douglas
Are you ready for a conversation about selling your Gold Coast home?
Let’s get you Selling
LET’S GET YOU SOLD
Craig Douglas 0418 189 963
Professional | Knowledgeable | Experienced
You can find me working at a Boutique Real Estate Agency
These are just some of the suburbs that I proudly sell homes in:
Paradise Waters
Please Note: The information contained in this document is for general information purposes only and does not constitute legal advice. The laws and regulations governing the sale of property in Queensland are complex and constantly changing. It is important to seek the advice of a qualified property lawyer or conveyancer before making any decisions about the sale of your property. This document does not take into account your individual circumstances and may not apply to your situation. By reading this document you agree that you have not relied on the information contained herein and that you will seek independent legal advice before taking any action.
This page was proudly created by Craig Douglas, your local independent Gold Coast real estate agent, working for a Boutique Real Estate Agency. Selling residential and commercial properties, from those that are awe-inspiring, through to a diamond-in-the-rough, otherwise known as a “renovator’s delight“.
I negotiate and sell on behalf of property owners who want to get the Best Possible Price, with the least amount of hassle. Let’s talk about the process of selling your property over a coffee to get you started – 0418 189 963
