Why shouldnt I price my house a little high, since I can always drop the price later?
A. Thats a strategy that sounds good but, in fact, is more likely to result in a lower price. Heres why. The first few weeks a house is on the market is when it will have the most activity. If a house is overpriced, it has to compete with houses at that higher price level, which are houses at that higher price level, which are almost certainly larger or have newer/more luxurious features. So the overpriced home is unlikely to attract an offer. Worse yet, those first weeks are when real estate agents preview the house. If its overpriced, they may not even bother to show it to their buyers. Eventually, the seller will have to drop the price and may end up with an even lower price because buyers will wonder why the house has been on the market so long and may factor that into their offer.
