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If you are an agent representing someone looking to buy a home, it is important to look out for the signs of overpriced properties. Being able to discern which homes are properly priced will make the search for a home much less overwhelming for your clients, and help you learn which homes are actually out of your clients’ price range and which are just listed for too much money.

The first indicator that a home is overpriced is that it is priced well above neighboring properties. Even if homes are not on the same few streets, if they are in the same vicinity with no features that set it apart from its competitors (water view, much more sq. footage, etc.) they should be in the same price range. A house that is far and above its neighbors is definitely overpriced, so if you love the neighborhood it is best to either look at other comparable houses or offer below asking.

Another sign to watch out for is if the online posting of the home doesn’t have a lot of traffic. 90% of buyers start their search online, so an online posting of a house should be getting a lot of hits (as opposed to just a “for sale sign” in the front yard.) If you find a posting for a client that has seen very little interest, but is in a desirable neighborhood, it is an immediate flag that the pricing is probably wrong.

Learning to figure out if a house is overpriced is a valuable tool for a realtor to have. If a home is overpriced and has been on the market for a long time, you can communicate to your clients that if they love the home they can offer below asking. A seller that won’t budge on an overpriced house is not going to be able to sell, and that house ends up on the market for a long time. It only takes so long with no offers for a seller to start to budge, so if there is a neighborhood that your clients are in love with and you find a property like that, it could work out in your clients’ favor.