What Happens When You Underprice a Listing? (Part 2)

The question sounds simple: list low to spark a bidding war, or price at value and let the chips fall? In practice, it’s messier. Market cycles twist, buyer psychology shifts, and the same tactic that fizzles for one property can catch fire for the next. In this follow-up episode of Selling Greenville, the host revisits underpricing with fresh data and frank hindsight—because the market that existed when Part 1 aired isn’t the market that took shape afterward.

The short of it: underpricing isn’t a magic trick, but in specific scenarios it can outperform. And in a shifting market where demand no longer feels bottomless, the strategy deserves a permanent spot in the listing playbook—handled with care.

Underprice a Listing: What Really Happens Now

“Underprice a listing in Greenville” is more than a headline claim in this episode; it’s a study, a caution, and a set of rules learned in the wild. A year and a half ago, the show concluded that underpricing performed about the same as pricing “right”—maybe a hair better, but close enough to call it even. That conclusion didn’t age well once the market went into overdrive later in 2021. With hindsight (and another round of analysis), the host now lays out where underpricing shines, where it stumbles, and how to deploy it without leaving money on the table.

A quick rewind: overpricing vs. underpricing

Before diving into “low list” tactics, the episode reaffirms one timeless truth with numbers:

• Overpricing hurts. A prior analysis found that homes launched above market ended up selling for $12 per square foot less than homes that were priced correctly or underpriced. On a 2,000 sq. ft. home, that’s $24,000 evaporated—plus longer days on the market and more stress.

That’s the backdrop for revisiting underpricing. In the original (March 2021) look, underpriced listings sold for roughly the same as properly priced ones—technically a smidge higher, but too small to call meaningful. Then the market took off in ways few expected, and underpricing became common practice across the Upstate.

When underpricing ignites a bidding war (a real example)

The episode cites a small home on a busy street that launched at $175,000. By any reasonable reading, it was worth $215,000–$220,000. The final sale price? $237,000. The under-list price didn’t just invite showings; it multiplied them, pulling in buyers who would have skipped at $220K. One of those buyers fell in love and stretched.

That’s the psychology underpricing taps: more bodies through the door, more offers on the table, and a greater chance someone finds “the one” and reaches. The key, the host stresses, is how much you underprice.

If you underprice, underprice by a lot

A consistent take across both episodes: nibbling a list price $5K–$10K below value rarely moves the needle. The market shrugs, offers a stick near the list, and the hoped-for auction never materializes. If the strategy fits the property, a meaningful gap—think $25K–$30K in this episode’s framing—creates the gravity needed to build a true crowd and spark competitive momentum.

New six-month study: how underpricing performed

To update the thesis, the host pulled all Greenville MLS sales of homes and townhomes in the past six months, then filtered for subdivisions with at least four sales (to avoid one-off distortions). “Underpriced” was defined as properties that sold for $115,000+ above list—a bright line meant to distinguish true low-list strategy from ordinary “multiple offers added $5K–$12K.”

Results:

• Average lift: Underpriced homes sold for $7.63 per sq. ft. more than non-underpriced peers in the same subdivision.

• Median lift: $4.70 per sq. ft. more.

Even at the median, that’s real money. On a 2,000 sq. ft. home, $4.70 equates to $9,400 extra to the seller.

But it’s not a slam dunk every time:

• Sample size: 657 homes met the criteria.

• Miss rate: 269 of those (a touch over 40%) still sold below the average for their subdivision—proof that underpricing can misfire depending on property, timing, and buyer pool.

Takeaway: as a tactic, underpricing produced meaningful upside on average—but a nontrivial share of listings left money on the table compared to the neighborhood norm.

Where underpricing makes the most sense

The show identifies two scenarios where underpricing most often earns its keep:

1. Hard-to-value properties: When comps are thin or mismatched, let the market set the number. Examples include:

   • Fixer-uppers without recent comparable sales.

   • Homes with unique features (e.g., an apartment over the garage) or notable omissions (e.g., the only house in the neighborhood without a garage).

   • Neighborhoods with non-conforming stock—near downtown Greenville or in areas like Overbrook, Gower Estates, or Parkins Mill—where a house’s size or features don’t line up neatly with neighbors.

2. When you want investor buyers in the mix, investors aren’t spraying offers at retail prices; they want an edge. A low list pulls them through the door. Once engaged, some cash-heavy investors will step above the crowd if the asset fits their playbook or if they’re eager to park cash before financing costs rise again.

Underpricing isn’t a one-size-fits-all move, but in these two buckets, it can be the right one.

Why “you can’t underprice in this market” falls short

The episode directly challenges a claim heard locally: “You cannot underprice a house in this market.” The updated data says otherwise. Yes, the averages favored underpricing this past half-year, but 40% of the time it didn’t beat the subdivision’s norm. It’s a tool, not dogma. Use it when the context supports it; skip it when the value is clear, and the property will command its number without theatrics.

The market has shifted—and that changes the calculus

Back in early 2021, the show suggested a cooling trend was near; instead, the market went “bananas,” with inventory plunging into the ones and year-over-year price gains bursting into the 20% range. Today, signs of deceleration exist alongside pockets that are still hot. One knock-on effect: the old trick of overpricing, sitting, dropping the price, and then catching a second-wind bidding wave has largely vanished. In that context, using underpricing to get in front of a shift—and let the market decide—can be the safer path than guessing high and paying the $/sq. ft. penalty later.

Practical rules of thumb

• Don’t overprice. Ever. The show’s prior analysis pegs the damage at $12/sq. ft. and a longer time to sell.

• If you underprice, be bold. A token discount rarely creates an auction. A meaningful gap can.

• Match strategy to property. Unique, fixer, non-conforming, or investor-friendly? Underpricing deserves a look. Bread-and-butter, easily comped? Price near value and let demand speak.

• Expect buyer psychology to do the heavy lifting. Low lists widen the funnel; some of those extra showings convert because of fit, not just math.

• Know it won’t work every time. Even in this study’s favorable window, ~40% of “underpriced” outcomes underperformed the neighborhood average.

Why the nuance matters more than ever

Every listing is a collection of trade-offs: speed vs. spread, certainty vs. upside, and attention vs. fatigue. This episode’s stance is balanced and clear-eyed. The host isn’t advocating for a blanket “low list” strategy. He’s adding a sharpened tool to the kit for the moments when pricing clarity is low, investor appetite is relevant, or the broader market’s crosscurrents make nailing “the number” more guesswork than science.

When the property and timing align, underpricing a listing in Greenville can tilt outcomes meaningfully higher—$7.63/sq. ft. on average and $4.70/sq. ft. at the median across the latest sample. When they don’t, disciplined, at-value pricing remains the sanest path.

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Bottom Line

Underpricing isn’t a cure-all; it’s a context move. In a six-month cross-section of Greenville MLS sales, underpriced homes outperformed their peers by $7.63/sq. ft. on average (and $4.70/sq. ft. median), but about 40% still lagged their subdivision’s norm. Use the tactic when value is ambiguous or investor energy matters—and if you do it, underprice by a lot, not a sliver. Above all, don’t overprice. That’s the one pricing strategy the data consistently exposes as costly.

Ien Araneta

Journal & Podcast Editor | Selling Greenville