Humber/Ontario Real Estate Course 3 Exam Practice

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Prepare for the Humber/Ontario Real Estate Course 3 Exam with our practice quizzes. Study using multiple-choice questions complete with hints and explanations. Ace your exam with confidence!

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What is likely to happen if a property's listing price is significantly above its market value, assuming a normal market?

It typically shortens the selling period.
It usually ensures that buyers will pay more.
It may improve the property's competitiveness.
It can detract from marketability by deterring potential buyers.
It often attracts multiple offers.
It ensures a higher final sale price.

The correct answer is: It can detract from marketability by deterring potential buyers.

When a property's listing price is significantly above its market value in a normal market, it can detract from its marketability by deterring potential buyers. Buyers generally conduct thorough market research and are aware of comparable properties and their pricing. If they perceive a property as overpriced, they may choose to look elsewhere rather than invest their time and resources into a property that does not align with market trends. This situation can lead to reduced interest in the property, as potential buyers may believe they can find more value in better-priced options. Additionally, an overpriced listing might set a negative perception about the property's value, causing further hesitation among buyers who might otherwise have been interested if the property were more realistically priced. As a result, the time a property spends on the market may increase, which can further hinder the seller's chance of attaining a favorable outcome.