Why the Highest Listing Price Isn't Always Your Best Option

The Reality Behind the Numbers

The Inverloch property market, like many coastal Victorian markets, has experienced significant shifts over the past year. Looking at recent sales data from November 2024 to May 2025, a clear pattern emerges that should give sellers pause.

Let's examine the facts: Out of 109 properties sold in Inverloch during this period, a significant number experienced substantial price reductions between their initial listing price and final sale price. This pattern suggests that overpricing a property at the outset can lead to prolonged time on market and eventual discounting.

The 10 Most Dramatic Price Differences

The following properties demonstrate the most significant gaps between listing and selling prices in Inverloch:

• 21 Pier Rd - Initial Price: $1,870,000 | Final Sale: $1,143,500 | Difference: -38.8% | Days on Market: 622

• 19 Cuttriss St - Initial Price: $1,295,000 | Final Sale: $928,000 | Difference: -28.3 | Days on Market: 435

• 18 Oceanic Dr - Initial Price: $1,090,000 | Final Sale: $825,000 | Difference: -24.3% Days on Market: 486

• 10 Woodland Heath Dr - Initial Price: $650,000 | Final Sale: $488,000 | Difference: -24.9% Days on Market: 58

• 56 Cuttriss St - Initial Price: $840,000 | Final Sale: $635,000 | Difference: -24.4% Days on Market: 583

• 5 Fern St - Initial Price: $1,100,000 | Final Sale: $850,000 | Difference: -22.7% Days on Market: 230

• 3/41-43 Veronica St - Initial Price: $645,000 | Final Sale: $500,000 | Difference: -22.5% Days on Market: 413

• 20 Marion Crt - Initial Price: $775,000 | Final Sale: $605,000 | Difference: -21.9% Days on Market: 434

• 46 Beilby Ave - Initial Price: $850,000 | Final Sale: $682,000 | Difference: -19.8% Days on Market: 129

• 27 Artisan Way - Initial Price: $1,050,000 | Final Sale: $845,000 | Difference: -19.5% Days on Market: 132

These figures aren't just numbers - they represent real homeowners who likely faced months of stress, ongoing property maintenance costs, mortgage payments, and the emotional toll of watching their expected return diminish week after week.

The True Cost of Overpricing

The consequences of overpricing extend far beyond just accepting a lower offer. Let's break down the real costs:

1. Extended Time on Market

The average days to sell in Inverloch during this period was 127 days. However, many overpriced properties languished for significantly longer - some for over a year. The most dramatic example is 21 Pier Road, which took over 20 months to sell, finally achieving just 61.2% of its original asking price.

2. Perception of Property Issues

When a property sits unsold for an extended period, potential buyers often wonder what's wrong with it. This perception can lead to even lower offers as the property becomes "stale" in the eyes of the market.

3. Financial Strain

Continuing to pay mortgage, council rates, insurance, and maintenance costs while waiting for a sale can quickly erode any theoretical gain from a higher listing price. For the owner of 21 Pier Road, this meant potentially 20 months of additional carrying costs.

4. Reduced Negotiating Power

Sellers with properties that have been listed for several months often lose negotiating leverage, as buyers sense desperation and know the property history.

The Psychology Behind Agent Price Suggestions

Understanding why some agents might suggest unrealistically high prices is crucial:

1. Buying the Listing

This is the industry term for when agents deliberately overvalue a property to secure the listing. They know that sellers are naturally drawn to the agent who promises the highest price, so they inflate the valuation to win your business. Once they have your listing secured with a lengthy contract, they'll begin the process of "managing your expectations downward" through feedback from inspections and market comparisons. By then, you're contractually committed to them for a set period, often 3-6 months. Click HERE to learn more about this.

2. Managing Expectations

Some agents plan to "manage expectations down" over time, starting with an inflated price and gradually bringing sellers to accept market reality.

3. Testing The Market

Some agents genuinely believe in testing higher prices to see if the market will respond, especially in unique properties or those with special features. This may sometimes work in a booming market but more often than not will backfire costing the seller potentially 100's of thousands of dollars.

How to Choose the Right Agent in Inverloch

Instead of selecting an agent based solely on their price suggestion, consider these factors:

1. Evidence-Based Pricing

Look at properties like 21 Pier Road as a cautionary tale. Initially listed at $1,870,000 in August 2023, it took nearly two years to sell and ultimately achieved only $1,143,500 - a staggering 38.8% reduction. A good agent will show you true comparables and recent market trends, not just inflate your expectations with unrealistic figures. They'll present both the exciting high-end sales and the sobering reality of properties that suffered from overpricing.

2. Marketing Strategy

Review the agent's marketing approach. How will they present your property to stand out in the Inverloch market? What platforms will they use? How will they reach potential sea-changers from Melbourne?

3. Local Market Knowledge

Inverloch's market has unique characteristics as a coastal destination. Agents deeply familiar with the local area can leverage this knowledge to attract the right buyers. For example, knowing the appeal of properties near popular beaches versus those in newer developments.

4. Communication Style

Your agent should provide honest feedback, even when it's not what you want to hear. The agent who tells you your home is worth more than others suggest might be telling you what you want to hear rather than what you need to know.

Success Stories in Accurate Pricing

Not all Inverloch properties experienced dramatic price drops. Some homes sold quickly and close to their asking prices:

• 11 John St sold in just 10 days at its listing price of $750,000

• 7 Heather Grove sold in 25 days within its price range of $695,000-$735,000, achieving $700,000



• 6 Nation Court sold in only 8 days for $680,000, just 2.2% below its asking price

These properties share a common factor: realistic initial pricing that attracted genuine buyers quickly.

The Data-Driven Approach to Pricing

One clear trend in the Inverloch data is that properties priced realistically from the outset generally sold faster and often closer to their asking prices. When there's alignment between seller expectations and market reality, the selling process becomes smoother and less stressful.

Conclusion

Choosing an agent based solely on who provides the highest valuation can be a costly mistake. The data from Inverloch clearly demonstrates that overpriced properties often sell for significantly less than their initial asking prices after extended periods on the market.

The most successful sales come from partnerships with agents who provide honest, market-based valuations and effective marketing strategies. While it might be tempting to list with someone who promises a higher price, the numbers tell us that this approach often leads to disappointment and financial stress.

In real estate, as in many aspects of life, honesty and realism triumph over optimistic promises. Choose an agent who backs their suggestions with solid data and a proven track record, and you'll be more likely to achieve a successful sale in Inverloch's dynamic market.



This article is based on real sales data from Inverloch, Victoria for the period from November 2024 to May 2025, compiled by Property Data Solutions Pty Ltd.

Leo Edwards is an award-winning real estate agent specializing in the Inverloch property market. With access to comprehensive market data and deep local knowledge, Leo provides unparalleled expertise to buyers and sellers navigating this dynamic coastal market.