Pricing a Listing: Under, At, or Above Market?

By Michał Babula · ~8 min read · 2026-07-03

The Pricing Conversation Nobody Enjoys

Every agent has been in this room. The seller has a number in their head — usually derived from what their neighbour sold for eighteen months ago, plus what they spent on the new kitchen, plus a vague sense that the market is "up." Your job is to land somewhere that actually sells the property, ideally without the seller feeling like you just talked them out of their equity.

The pricing decision breaks into three buckets: under market (roughly 5–10% below the comp average), at market, or above market. Each has a time and a place. The problem is that agents sometimes apply the wrong one because the seller pushed back, or because the agent wanted to win the listing. Both are bad reasons.

Let me go through each strategy in order of how often it actually makes sense.

When Under-Market Pricing Actually Works

Pricing 5–10% below the comp average is a deliberate tactic, not a concession. Done right, it compresses the decision window for buyers, generates competing offers, and can push the final sale price above what a more conventional listing would have achieved. Done wrong, it hands money to the buyer's agent to write a clean offer on day one and walk away.

The Conditions That Have to Be True

Under-market pricing only produces a bidding war when all of these conditions hold simultaneously:

• Low absorption rate. If the market is absorbing inventory in under 30 days, there are more buyers than homes. The under-price creates urgency that already exists in the market.
• The property photographs well and shows well. The strategy depends on volume of showings in a tight window — usually 4–7 days before reviewing offers. If the home needs work or has a layout buyers have to "see past," the volume won't materialise.
• You have the reach to create awareness fast. This is where multi-channel distribution matters. A listing that only hits one portal on a Friday afternoon will not generate the weekend traffic you need. It needs to be on every surface buyers are actually looking at — portal, social, local Facebook groups, the agent's own network — within hours of going live.
• The seller genuinely understands and accepts the strategy. If the seller panics at day three and demands you raise the price, you've burned the window and now you have an overpriced listing with a "price reduced" flag on it.

When It Just Leaves Money on the Table

In a balanced or buyer-leaning market — absorption rates above 60 days, inventory building — under-pricing does not trigger a war. It triggers one offer, slightly below your already-low ask, from a buyer who assumes the price signals a problem. From agents I've spoken to, this pattern is especially common in secondary cities where the buyer pool is thinner and buyers don't feel competitive pressure even when inventory is tight.

The other scenario where it fails: unique or premium properties. If you price a €2.4M villa 8% under comp average, you're not generating a bidding war — you're attracting buyers who were budgeted for €2.2M and will be stretched and nervous throughout the process.

At Market: The Highest-EV Default

If I had to pick one pricing strategy for a market I didn't know well, I'd pick at market — meaning within 1–2% of the weighted comp average, adjusted for condition and location within the submarket. It's not the most exciting answer, but it's the highest expected-value default across the widest range of market conditions.

Here's the logic. At-market pricing:

• Attracts buyers who are actually qualified for that price bracket (unlike under-pricing, which pulls in unqualified lookers)
• Doesn't start the DOM clock with a stigma attached
• Gives you room to negotiate without a price reduction, which preserves perceived value
• Works in both rising and flat markets without requiring a bidding-war scenario to justify the number

In my experience, at-market pricing in a reasonably active market produces offers within 2–3 weeks in the majority of cases. The seller doesn't feel they left money behind, and you don't have to manage the psychological rollercoaster of a failed under-price strategy.

The caveat: "at market" is only as good as your comps work. A lazy CMA that doesn't account for micro-location differences, recent condition upgrades, or the specific buyer profile for that property type will give you a number that looks like at-market but isn't.

The Above-Market Trap and the 3-Week DOM Threshold

This is the one that costs sellers real money, and it's the one they push for most often.

The mechanics are straightforward. You price above market — let's say 7–12% above comp average — because the seller believes their home is exceptional, or because you wanted to win the listing, or both. The first two weeks, there are showings. Buyers come through, note the price, and move on to better-value alternatives. No offers arrive.

Then something shifts. Around day 21–25 on market, buyer perception changes. At that point, buyers and their agents stop asking "why hasn't this sold?" and start assuming the answer is something wrong with the property — a survey issue, a neighbour dispute, a structural problem. The listing develops a reputation it doesn't deserve.

When you finally reduce the price, you've now got two problems: the reduced price, and the DOM flag that tells every buyer's agent this property has been sitting. From agents I've spoken to in both the UK and Polish markets, a price reduction after 3+ weeks on market typically produces offers that are 2–4% below where an at-market listing would have closed — meaning the seller ends up worse off than if they'd priced correctly from day one.

The seller who insisted on pricing high often ends up netting less than the seller who agreed to the right number at the start. That's the trap.

Reading the Absorption Rate Before You Walk In

Absorption rate is the single most useful number for framing the pricing conversation. It tells you how many months of inventory exist at the current pace of sales. The formula:

Absorption rate (months) = Active listings ÷ Homes sold per month

General benchmarks, though these vary by market:

• Under 3 months: Seller's market. Under-pricing can work. At-market will also sell fast.
• 3–6 months: Balanced. At-market is the clear default. Under-pricing is risky; above-market is a trap.
• Over 6 months: Buyer's market. Pricing at or slightly below market is necessary. Above-market pricing will sit indefinitely.

Pull this number for the specific property type and submarket — not the city overall. In Warsaw, for example, the absorption rate for 2-bedroom apartments in Mokotów can be entirely different from 3-bedroom units in Białołęka. Otodom's market data and local MLS equivalents can give you this if you pull a 90-day window. Don't walk into a listing appointment without it.

The Comps Presentation Script That Gets the Seller to Agree

The seller has a number. You have a lower number. Here's the structure that works without making the seller feel steamrolled.

Step 1: Start with what sold, not what's listed. Active listings are the seller's competition, but sold listings are the only data that reflects what buyers actually paid. Lead with sold comps. Say something like: "I want to show you what buyers in this area have actually committed to in the last 90 days — not what sellers are asking, but what deals closed."

Step 2: Present three tiers. Show three comp brackets — slightly below your recommendation, at your recommendation, and slightly above. Walk through the days on market and final sale price for each tier. Let the data show what happened to listings priced above market without you having to say it directly.

"This one here — listed at €420,000, reduced to €395,000 after five weeks, closed at €388,000. The sellers were aiming for €420,000 and ended up at €388,000. This one — listed at €385,000, received two offers in nine days, closed at €391,000."

Step 3: Frame your number as the market's number, not yours. "I'm not recommending €385,000 because I want a quick sale. I'm recommending it because that's where buyers in this submarket are drawing the line right now. If I could get you €410,000, I would — my commission goes up too. But the data says buyers are walking away above €390,000 on this property type."

Step 4: Give them the cost of waiting. Run a quick calculation. If the property sits for 8 weeks at an above-market price, then reduces and closes 12 weeks from now versus selling in 3 weeks at the right price — what does that cost in carrying costs, mortgage payments, and the psychological weight of an unsold listing? For most sellers, the number is meaningful.

This script doesn't work 100% of the time. Some sellers need to test the market at their number before they'll believe you. When that happens, agree on a clear price-review trigger — something like "if we have fewer than X showings in the first two weeks, we revisit the price immediately" — and get it in writing before you list.

The goal isn't to win the argument. It's to get the seller a result that makes them refer you to their friends.

Editorial review by Michał Babula (also the author) on 2026-07-03. In v1 of this blog, author and editorial reviewer are the same person — I'll note when that changes.