Strategic underpricing is now the norm in Long Island’s real estate market, turning the asking price into a marketing device rather than a true indicator of what sellers expect to receive. This approach has created confusion, particularly for first-time buyers who rely on outdated advice.
Jeffrey Memisha, a licensed sales associate at Realty Advisors Inc., says that the gap between list prices and actual sale expectations is wider than ever. He notes that buyers who take advice from relatives who purchased homes decades ago often find themselves repeatedly outbid. “Sometimes we see clients who are first-time home buyers, and they have an uncle or parent who bought a house fifty years ago,” Memisha says. “That parent tells them not to offer the asking price. Then we work with these people, and they keep getting outbid and outbid on all the houses.”
Memisha emphasizes that the market has changed so dramatically that traditional guidance is now misleading. Many buyers still assume the asking price is a ceiling, when in reality it is often set below what sellers hope to achieve. This disconnect routinely leaves inexperienced buyers at a disadvantage.
According to Memisha, sellers and their agents now use the asking price to attract interest and spark bidding wars, rather than as a reflection of their minimum acceptable price. “The asking price is legitimately the price that people want — a lot of the time right now, it’s just a marketing tool to get more people in the door and gain more traction and get that bidding war,” he says.
This tactic is enabled by a persistent inventory shortage across Long Island. When Memisha and his colleagues prepare market analyses, they often find only a handful of comparable sales but sometimes none at all. “When we go on appointments, and we’re printing out comps and looking at other sales in the area, there’s maybe three or four comps that we can compare to,” he explains. “Sometimes there’s one, sometimes there’s none.”
With so few data points, sellers have unusual freedom to set prices, especially those with distinctive properties. Memisha says that owners of unique homes often choose a number based on personal preference, and in many cases, the market meets their expectations. “A lot of these people, if they have something unique, they just pick a price that they want, and oftentimes they get it,” he says.
This shift in pricing strategy has created significant challenges for buyers who are new to the market or who rely on family members for guidance. Many first-time buyers, following advice rooted in a very different era, believe that offering below the asking price is standard practice. In today’s market, that approach is almost guaranteed to result in repeated disappointment.
Memisha regularly sees this pattern: buyers anchored in old assumptions submit conservative offers, only to lose out to more aggressive bidders. The information gap is most pronounced among those who lack recent experience or professional support, leaving them ill-prepared for the realities of modern homebuying on Long Island.
The current landscape of low inventory and sparse comparable sales data has made it difficult to establish clear pricing benchmarks. This uncertainty gives sellers and their agents the flexibility to experiment with pricing tactics, knowing that buyers have limited reference points.
Memisha points out that this environment is a recent development. Even a few years ago, more robust sales data enabled clearer price setting. Now, with fewer homes changing hands, agents increasingly use the listing price to generate interest rather than as a firm starting point for negotiation.
However, not every seller adopts this strategy. Memisha says his firm sets realistic prices based on available data, especially for properties without unique features. “Sometimes sellers do need to be a little bit more realistic” when their homes don’t stand out enough to justify premium pricing, he notes.
The rise of fictional pricing raises concerns about transparency and efficiency in Long Island’s housing market. When asking prices no longer reflect seller expectations, buyers must either become experts in local market trends or risk making offers that fall short. This information imbalance is particularly tough on first-time buyers, who often lack both recent experience and professional representation.
Whether this pricing approach will last depends on how long inventory remains tight. Memisha sees little sign of change in the near future, suggesting that strategic underpricing will likely persist as long as demand continues to outstrip supply.
For buyers, the message is clear: in today’s Long Island market, the asking price is just the starting point. Serious contenders need to look beyond the number on the listing and be prepared to move aggressively to succeed.
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