Margo did a great job of describing why it's so important to price properly at the beginning of the listing period.
What happens when you overprice your home?
In my listing presentation, I explain the "wave" theory of real estate to prospective sellers.
The day the listing hits the market, your property is at the crest of the wave. Buyers who are educated (ie. have seen all the other inventory), ready and willing (ie. have a need to move), and able (ie. have been pre-approved), are waiting for your house to hit the market.
If there is something out of synch - the marketing, condition, or price - and these buyers pass on making an offer, the property sinks into the trough of the wave. This is typically where some kind of adjustments are made. For example, the owner might spruce up by painting, or the agent might change marketing for greater effectiveness. If the problem can't be solved in any other way, then a price adjustment is made.
Now the market days start ticking along as we wait for a new wave of buyers to enter the market, get educated, get qualified, develop a pressing need, and if there is no offer, it is back into the trough again. This time it is even more likely there will be a price reduction.
The first question every buyer asks is: "how long has it been on the market?" The seller's most powerful answer: it just came on! The longer it stays out there, the greater the shift of power from the seller to the buyer. The longer the market days, the larger the price adjustment the buyer will make - whether the seller chooses to do it or not!
The second question the buyer asks is: "have there been any offers?" If not, then the next thought is: "how come nobody else wants this house?" If you are racking up market days you are indirectly potentially stigmatizing your property. It's a question of social reinforcement: everyone wants what everyone else wants -and no one wants what nobody else wants!
Pricing the property correctly results in: highest percentage of asking price achieved, shortest inconvenience to seller, greatest buyer-seller satisfaction, and the quickest path to closing.
So, price it right, ride the crest of the wave, and SELL!
"Delivering Dreams.....With Integrity!!!"