There are essentially three strategies for your list price: pricing below market value, at market value, and above market value.

Market value

Your REALTOR® can determine market value through a comparative market analysis (CMA). Many REALTORS®, including me, offer a free, no-obligation CMA. Market value is essentially what a reasonable buyer would pay for your home — and it may not coincide with your own expectations, for good or bad.

Sellers often have an emotional connection to their house, and rightly so — it’s where they’ve made amazing memories. But it’s important to distinguish between what the home is worth to a seller and what it’s worth to potential buyers. Buyers who are ready and willing to offer are educated and have seen a number of comparable homes, so they have a good idea of market value from their own searches and viewings.

Pricing below market value

This strategy has different benefits depending on market conditions.

Seller’s market: Supply is low and buyers compete for limited inventory. Many sales become multiple-offer situations where buyers bid above asking. It’s still important to set your list price sensibly.

Neutral market: Supply and demand are more or less even. This can work well if your house stands out from the comparables — a sought-after neighbourhood or school zone, unique renovations, or great income potential — and is a great way to attract multiple offers.

Buyer’s market: Supply is rising and prices are declining. Pricing below market value is a great way to price ahead of the market and sell quickly — useful if holding costs (like ongoing mortgage interest) are adding up.

Pricing at market value

This is a fairly safe strategy in most conditions and gets a fair price for your home. In the best case you may attract multiple offers and sell above market value. For it to work, the property needs to be marketed well to reach the largest number of buyers. Educated buyers recognize a correctly priced house and are more likely to jump in with an offer.

Pricing above market value

This sometimes appeals to sellers because of the illusion that pricing high means selling high — and if not, they can just lower it later. But this strategy has real downsides, and there are examples where an overpriced house sold for less than market value.

Negotiation: Many buyers avoid houses they think are overpriced, not wanting to make lowball offers for fear of offending sellers. Even if your home is perfect for them, at the wrong price you may miss the boat.

Buyer exposure: Pricing high can do the opposite of protecting your downside. Pricing at $305,000 instead of $299,900 may mean buyers searching the $275,000–$300,000 range never see it — restricting exposure limits your pool of buyers.

The two-week window: Your house gets the most attention in the first two weeks. Price above market value and you lose that critical window. The sooner you sell, the better the odds of getting close to asking — and potentially multiple offers. Past the two-week mark, the house starts to go stale as new listings appear, and buyers begin to wonder what’s wrong with it, even if the only problem was the price. You may even be making other houses in the neighbourhood look like better deals.

Price reductions: If a house sits on the market a long time, multiple offers become almost non-existent, and buyers realize it’s overpriced and come in low. You may have to lower the price to stay competitive, which adds to the narrative that something is wrong.

Personal cost: Keeping your house on the market a long time is exhausting — it has to be kept show-ready at all times. And if you’re trying to move, consider the holding cost of staying put when you could be putting payments toward your new house.

Setting a list price is extremely important: too high and you risk going stale; too low and you may not get what you could have with a better strategy. Discuss the strategy — and the marketing plan — with your REALTOR®. If you’re thinking of selling, get in touch and we can set up a no-obligation meeting.