Episode 21: All too often, real estate agents talk about how sellers are unrealistic in their desire to list their home for sale at an inflated price.

In this segment of The Wheel Estate Cam, broker Frank LLosa makes a case for strategic overpricing.

He shares an example of a past condo listing that he represented, which he felt was priced too high for the market. Another unit in the same building was later listed for sale with an even higher price, and quickly he received an offer for the unit he represented because it was about $40,000-$50,000 cheaper than the comparable unit.

"There was a buyer who got super-excited about my unit, thinking that my unit was like the bargain of the century even though mine was not a bargain and the other one was even less of a (bargain)," Llosa says.

In another instance, when representing a townhouse in Reston, Va., LLosa says the seller agreed to overprice by about $15,000 to $20,000, which led to bids on a comparable home that was priced lower.

So overpricing in that instance also served to stimulate activity — after the cheaper unit sold, the townhouse LLosa represented soon after sold with a price reduction that was comparable to the other home’s price … but still was higher than what the typical market price would have been.

"Have you ever overpriced a listing? Is that unethical? Is that crazy? Should an agent always price at the price that (a property) should be, or do you actually take into consideration market dynamics," he says.

"We know it’s not the stock market, but … there might be some strategy to pricing which would include overpricing."

Comment below to share your thoughts.

Watch past episodes of the Wheel Estate Cam.

Frank Borges LLosa is the broker, founder and owner of FranklyRealty.com, a real estate brokerage in Falls Church, Va. He is the creator of the Trust Me I’m a Realtor blog and multiple listing service wiki site FranklyMLS.com. You can follow him on Twitter: @franklyrealty.

***

What’s your opinion? Leave your comments below or send a letter to the editor.

 

Show Comments Hide Comments

Comments

Sign up for Inman’s Morning Headlines
What you need to know to start your day with all the latest industry developments
By submitting your email address, you agree to receive marketing emails from Inman.
Success!
Thank you for subscribing to Morning Headlines.
Back to top
×
Log in
If you created your account with Google or Facebook
Don't have an account?
Forgot your password?
No Problem

Simply enter the email address you used to create your account and click "Reset Password". You will receive additional instructions via email.

Forgot your username? If so please contact customer support at (510) 658-9252

Password Reset Confirmation

Password Reset Instructions have been sent to

Subscribe to The Weekender
Get the week's leading headlines delivered straight to your inbox.
Top headlines from around the real estate industry. Breaking news as it happens.
15 stories covering tech, special reports, video and opinion.
Unique features from hacker profiles to portal watch and video interviews.
Unique features from hacker profiles to portal watch and video interviews.
It looks like you’re already a Select Member!
To subscribe to exclusive newsletters, visit your email preferences in the account settings.
Up-to-the-minute news and interviews in your inbox, ticket discounts for Inman events and more
1-Step CheckoutPay with a credit card
By continuing, you agree to Inman’s Terms of Use and Privacy Policy.

You will be charged . Your subscription will automatically renew for on . For more details on our payment terms and how to cancel, click here.

Interested in a group subscription?
Finish setting up your subscription