"Price It High to Leave Room to Negotiate" Is Bad Advice Right Now

I still hear this from sellers more than almost anything else: "let's list a little high, that way we've got room to come down." It made sense in a slower market. Right now, it's mostly costing sellers money and time.

Here's the data. Homes in Lexington are closing at 98.5% of asking price on average, and averaging just 22.2 days on market. That's not a market where buyers expect to negotiate you down 5-10%. That's a market where a well-priced home gets multiple serious offers in the first two weeks, often at or near full price.

Here's what actually happens to the overpriced listing instead. The first two weeks, when a listing gets the most eyes and the most urgency, mostly pass with lighter-than-expected showings. Buyers are watching new listings closely enough to know when something's priced above the market, and they wait rather than engage. By the time a price cut happens, you've lost the exact window that generates the most interest and the most leverage. Buyers who see a price drop tend to ask what's wrong with the house, even when nothing's actually wrong. You end up chasing the market down from a weaker position than if you'd priced accurately on day one.

The "room to negotiate" logic gets the math backwards. If a home is genuinely worth $350,000 and you list it at $370,000 "to leave room," you're not creating negotiating leverage, you're creating a $20,000 gap that a buyer's agent will flag immediately using the exact same comps I'd use to price it correctly. Buyers today have access to the same sold-price data agents do. The room you think you're building in usually isn't fooling anyone.

What actually works instead: price it accurately from the start, based on real comps, not on what you'd like to walk away with. In this market specifically, an accurately priced home doesn't need negotiating room built in, because the competition among buyers does that work for you.

If you're thinking about listing and want a real number instead of a padded one, that's the conversation worth having before a sign goes in the yard, not after it's sat for a month.

Thinking about listing? Let's talk pricing before you second-guess it later →