HOW MUCH IS THAT WATCH?

You’re shopping for a new watch with a strict $500 budget. Despite your better intuition, you stroll into an expensive boutique filled with high-end luxuries. There is an alluring glass case in front of you and within it sits a beautiful timepiece that you simple must have.


Your retail dreams evaporate, however, when you notice the $30,000 price tag. But wait! There is another watch of the same brand for only $1,500! You instantly draw the credit card and make the purchase satisfied you scored a bargain.

Clever retailers have used this strategy for years; include some exorbitantly-priced items in your store to make others look better value. And many vendors in today’s real estate market are inadvertently doing the same thing. Overpricing a property not only severely hinders its sale, but it also helps competing properties to sell. Buyers see the overpriced property as proof that the lower-priced property offers great value for money and then feel confident purchasing it. The vendor of the overpriced property not only misses out on the sale but also helps to remove a buyer from the market.

As charitable as it might sound, no vendor would willingly help other sellers to achieve a sale at the expense of their own. This is why our recommendation to vendors in this situation is to withdraw the property from the market, rent the property or realign the price according to current market expectations.

It may sound a little harsh, but this is a reality of the current market where many buyers are lacking urgency and will quickly walk away from a property that doesn’t offer good value.