How to Spot an Overpriced Listing as a Buyer

How to Spot an Overpriced Listing as a Buyer

In today’s competitive market, knowing how to recognize an overpriced home is key. While it’s easy to get emotionally attached to a property, paying more than it’s worth can lead to long-term financial stress and buyer’s remorse. Here’s how to identify when a home’s price might be too high—and how to avoid overpaying.

1. Check Comparable Sales (“Comps”)

Compare the home to recently sold properties with similar size, location, and condition. If the listing is significantly higher than comparable homes nearby, it may be overpriced.

What to look for:

• Location: Stick to nearby properties.

• Size/Layout: Match square footage, bed/bath count, lot size.

• Condition: Consider updates or needed repairs.

2. Calculate Price Per Square Foot

Divide the list price by the home’s square footage. Compare this figure with other local homes.

Keep in mind:

• A higher number might be justified with unique features (e.g., a pool or new kitchen), but should still be in line with area averages.

3. Review Days on Market (DOM)

Homes that linger often signal pricing issues. If a property’s been listed for a while—or shows repeated price drops—it’s a red flag.

Tip: In a hot market, homes go fast. A slow-moving listing usually indicates buyers aren’t seeing value at the current price.

4. Consider the Seller’s Motivation

A motivated seller may price more realistically. Someone who’s not in a rush might overprice and wait for the right offer.

Look for clues: Relocation, financial strain, or a vacant property could signal more willingness to negotiate.

5. Evaluate the Condition

A home that needs work but is priced like it’s turnkey might not be worth it.

Watch for: Outdated systems, visible damage, or cosmetic upgrades that don’t match the asking price.

Final Thoughts

Being able to spot an overpriced listing can save you time, stress, and money. Use comps, look at the price per square foot, track market activity, and assess both the seller and the home itself.

Always lean on your trusted real estate advisor, trust your gut and don’t be afraid to walk away—especially when the numbers don’t make sense.