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House Sale Price: List It Right from the Beginning

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With house prices increasing across the country, sellers may think they can list their homes at a higher price and adjust if necessary. That may not be a good strategy. This is a post we ran last year by Ken H. Johnson, Ph.D. — Florida International University (FIU) and Editor of the Journal of Housing Research. To view other research from FIU, visit - The KCM Crew

House Price See SawThe Research

Are there any negative effects from changing the listing price of a property? This question haunts Brokers/Agents as well as sellers of property every day. At present, there does not seem to be a consensus answer to this question within the professional real estate community. Fortunately, this question was scientifically investigated by John R. Knight. Unfortunately, few know the results of Professor Knight’s research.

In Knight, the impact of changing a property’s listing price is investigated. Additionally, the types of property that are most likely to experience a price change are also estimated. The findings from this research indicate that, on average, properties which experience a listing price change take longer to sell and suffer a price discount greater than similar properties. Furthermore, bigger price changes are found to experience even longer marketing times and greater price discounts. Finally, as for which properties are most likely to experience a price change, Knight finds that the greater the initial markup; the higher the likelihood that any given property will experience a listing price change.

Implications for Practice

Sellers as well as Brokers/Agents should therefore be aware of the critical necessity of getting the price correct from the start. Sellers wanting to over list will ultimately take longer to sell and will sell their property for less, on average, according to Knight. Brokers/Agents’ desire to take a listing and get the price right later will ultimately lead to their working harder according to Knight, and they are not doing their sellers any favors. Thus, an initial and detailed analysis of the proper price is much more critical than many originally thought.

Interestingly, I have found in my own research that the direction (up or down) of the listing price change does not matter. A listing price increase and decrease both lead to similar results found in Knight’s work – longer marketing times and lower prices. Therefore, get the price right from the beginning. It is best for all.


[1] Knight, John, R. (2002). Listing Price, Time on Market, and Ultimate Selling Price: Causes and Effects of Listing Price Changes. Real Estate Economics. 30:2, 213-237.


About Ken H. Johnson

Dr. Johnson is a well-known scholar with numerous publications in real estate brokerage, transactional real estate, and real estate investment. Recent articles of Dr. Johnson’s have appeared in Real Estate Economics, Journal of Real Estate Finance and Economics, Journal of Housing Economics, Journal of Real Estate Research, Journal of Housing Research, The Appraisal Journal, Journal of Real Estate Practice and Education, Journal of Real Estate Portfolio Management, and Journal of Real Estate Law. In addition, he has won several Red Pen Awards for outstanding service and contribution to both the Journal of Real Estate Portfolio Management and Journal of Housing Research. Dr. Johnson is also a past Editor of the Journal of Real Estate Practice and Education. In April 2011, Dr. Johnson became an Editor of the Journal of Housing Research. Additionally, Dr. Johnson has over a decade of applied experience in real estate specializing in the sale of corporate- and lender-owned properties. Dr. Johnson received his doctorate from the University of Alabama in 2001. For additional details, see Dr. Johnson’s current CV at

One Response to “House Sale Price: List It Right from the Beginning”

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