House Talk with Silvia Dukes

Silvia, I pull these numbers all the time as well and they do tell you something don't they. They only larger fluctuations I see are in luxury ranges here where a few a going for quite a cut. ~Rita

Silvia

Thanks for sharing the information and market update.

Good luck and success.

Lou Ludwig

Silvia, It is amazing the effect of a properly priced home on it's saleability!  This is great information, thanks for sharing it with us!

Sylvia,

Very consistent numbers for your marketplace and a good indicator of future sales prices. :)

Steve

Seems to be the same in many areas - we're still closer to 95-97% of asking price.  The chances of getting a property for 50% of list price has got to be close to zero. 

Well, first you assuming that buyers are making an offer on a house that IS priced properly. That is very rare in this market for someone to acknowledge that their home is worth less than what they would like to get for it. Second, the majority of homes now are still overpriced. Even in a bad market, if the home is priced properly it will sell within 30 days. If it is on the market for more than that amount of time, it is overpriced. Look at the days on the market for each listing. What percentage of those are over the 3 month time period. This is the problem with the market right now. You have greedy sellers that think because of the 8000 dollar tax credit and first time buyers that they can overprice their home and get it. If this tax credit is extended, it is going to cause another increase in overpriced inventory. Just watch.

Sometimes it takes them a few losses before they get the picture and start listening to you. Then they will realize you know what you are talking about. For us, in the bank owned you better put in your highest and best right out the gate or you do not stand a chance!

Homes here sell at 97% of list price, they always have, even before the current market troubles. But quite often that's after price reduction(s) - especially in homes above $300,000. Which simply means, that even if buyers make lower offers when the house is overpriced, sellers aren't willing to take those offers until they reduce their price in smaller increments and find the market value for themselves. I always think it's odd when people say houses are selling below market value - because whatever price it takes to get a house sold, that is it's market value. But your question of homes selling below list price is a good one.

Our stats in Orlando continue to show that the majority of homes sell somewhere around 94-97% of the listed price.  Yes on occasion someone will accept a lowball offer, but those are still rare. More often that not, the great deals are selling with multiple offers.

Someone here's that some (mythical) one got a bargain and then they lowball you to death.  Usually after they lose 3 properties they start to come around.  Loss is a great motivator.

Great stats....Now if we could only get buyers to read and believe the figures.

If you listened to the national media a year or so ago, all you heard was that homes were a bargain and 30 to 40 percent lower than asking price was what everyone was getting them for. So Mr. and Mrs. home buyer, don't even think of offering anywhere close to asking price.

No matter how many times the price had been lowered , the buyers who listened to the news still thought 30-40 percent below asking price was the magic number....And, all their friends were telling them the same thing, sooooooo, it must be true.

So much easier to believe the friend, the cashier in the store, someone next to you in line for a seat in a restaurant.....or anyone but the people who do it for a living and with facts in print to back it up.

Yep, I had a home just like the one you are looking for and at the price you want, but I sold it in 1986.....maybe the owner will sell it to you for 30% less than he paid for it back then    :>)  

It would be nice if our market returned similar numbers, good luck ~ Brad

Rita, same here, in the higher price ranges some buyers get lower offers accepted but not always.

Lou, as always a pleasure, thanks for stopping in!

Tony and Darcy, absolutely!

Steve, thanks, it's beginning to look a bit more stable overall.

Penny, I agree. A 50% offer would be a bold move and might be ok for a grossly overpriced property but who would look at those in the first place considering the seller has not yet come to the realization that indeed he is overpriced?

 

Wow, it sounds like you have some bargains in your neck of the woods, with homes selling at 95-98% of asking price.  In my area homes are selling at 103-106% of asking price.  Inventories are the lowest they have been in over 10 years, and any decent home will get 10-20 offers on it.

John, your are right, overpriced properties don't sell.  Since these stats only concern sold properties that is a point you can infer as well.  And buyers do make offers on properties that are priced properly, they most often do not make offers on properties that are overpriced. 

Like you say, it is the sellers who need to realize, they cannot overprice and get it. Because they don't. Their homes are sitting until they get down to a reasonable list price that is competitive and will attract offers.  By that time of course, those homes have accumulated a long time on market depending on how you look at it.  MLS time yes, but actually being on the market? Questionable.

Hi Sylvia,  Thanks for a very well thought out and presented post.  The figures tell a very straight forward story for any seller or buyer willing to accept them.  Well done.

Hi Sylvia,  Thanks for a very well thought out and presented post.  The figures tell a very straight forward story for any seller or buyer willing to accept them.  Well done.

Dianne, agreed! REOs are the best example of competitively priced properties that will attract multiple offers and often sell above list price.

Joetta, it's amazing to me how sellers feel they have to "try" it first a bit higher and then inch themselves down. It's almost like slowly easing into cold water rather than jumping right into it to get it over with. 

Rob, exactly.  Great deals get multiple offers and have very short time on the market!

Gary and Shannon, half the time they only get half the story of the great bargain. Sometimes a bargain is not a bargain at all.

Larry, that's why I love numbers! It is easy to get caught up in a hype but the proof is in the facts.

Brad, thank you, hopefully things will look up soon for Marathon, Florida!  It's a great place for sure!

Bob, I appreciate you saying that these ratios represent bargains compared to other areas in the country.

Bill, thank you, I appreciate it your comment!

 

Silvia,

Excellent post.  The stats in Okaloosa County up here in the panhandle are similar to yours.  I have gotten buyers that "insist" they can get deals for 40 cents on the dollar because someone they know "just did that," but of course, the "story" they were told was likely an exaggeration, not to mention, the exaggeration they added.  Also, when they "see" 40 cents on the dollar, they are looking at list price and thinking they can knock 60 percent off; they are not looking at the true value of the property based on recents sales, not to mention, area has a lot to do with price AND value. 

Excellent information, though!  Great way to educate your buyers!

What I tell my clients is there are not a lot of super secret deals.  If it is on the MLS everyone knows about it and everyone is out looking at it and putting in the offers.

Silvia - Great information ... my concern with using stats is not knowing all the information behind the stats. I would be using a caveat that the percentage represented are based on the listing price of the homes at the time they were sold.

This is my life -

List Price $180K  Contract Price $180 K  Appraisal $155K Selling price $155K

And

List Price $50K  Contract Price $50K   Appraisal $44K   Sale Price $44K

Etc Etc

Valerie, thank you.  Of course averages are just averages, there are always exceptions to every rule. So, yes, there is probably a great deal included where somegot got a steal at 60 or 70% or list price but at the other end, there will be sales that went above list price as well.

Gene, isn't that the truth!

Kathy, of course, these are the final list prices at time of contract. 

Robin, appraisal values are just another good reason not to overprice.  On the bright side, your buyers and sellers have been wise to continue the transaction although both parties placed higher values on the property.  In fact, keeping it togehter at that point, is a great indication of success!

It's all about the price, and the statistics tell the story loud and clear.  Buyers need to understand that now most homes are priced correctly by the motivated sellers.  and buyers can spot those that aren't from a mile away!

same type of results we have in our market. We used to have 97-98 percent of list price and now it's about 92-93 percent. I have only seen 1 or 2 properties sell for roughly 60 percent of list and they were highly distressed properties

Here in the Grandville, MI area the number is 93.7% of sales price with an avg. price of $142,000.  It's good to stay on top of these stats. 

In our area, it is becoming normal to see a well-priced home sell for over the asking price. My most recent experience was placing a $200,000.00 offer on a home priced at $179,000 in a sub where homes have been selling for $240-$250. Getting my buyer to write over the asking price was a feat in itself as he actually wanted to low-ball it. This home was in great shape and had only been on the market 2 days. By the 3rd day, there was a total of 14 offers and our offer placed into the 7th position. So there were 6 buyers smart enough to realize the "opportunity" and one buyer smart enough to grab it. This is now the third home my buyer has lost to a higher bidder. This buyer is a dear friend of mine whp is relying on all his non-realtor friends  & acquaintances assuring him that he can still find a home at a "deal" even though each time we write an offer I provide him with the hard stats of the market area showing that selling prices of well-priced homes are NOT 20-40% under list.

Janna, that's right. Many buyers really are educating themselves before they even contact us.

Sandy, same here. You only get that kind of discount for properties that have severe problems and no one else wants them.

Ed, I agree, if you don't know, how can you expect your customers to know.

Farida, I hope your buyer will realize that your expertise is more reliable than the advice of his friends. Unfortunately, we all have customers like that occasionally. All the best.

Silvia, great information for buyer and sellers. You know your market!  Make a believer out of them, that's what I say!  It's like the 'fish that got away' or the guy that got the hole in one golfing - just every once in awhile!

Amen, sister!  Homes that sell ahead of the competition are homes that reflect the realities of the local market conditions.  I can't even take my listing clients on pricing tours to guess the price of their competition (in an effort to get them to lower their prices for a price adjustment or to justify where I think their home should be positioned to sell) since the majority of SF homes in my market are horribly overpriced by those brokers who love "listings for life".  God bless their little souls.

Recent solds is what people should look at.  Here with a majority of our sales being REO, most sellers are ordering multiple BPOs and appraisals (unlike normal or short sale sellers) so they know what the home is worth or to make sure it is properly priced. 

If you study the human psyche like I do, you know that people lie, and quite often, especially when it involves money. It's not unusual for me to go do a home inspection and when I pull the MLS listing, it says the price is $299,000. The Buyers tell me they are getting a bargain at $275,000. I find lots of problems and the Buyers tell me at their housewarming party that they got the price reduced by $25,000 for all the repairs. When I check the public records to see when escrow closed and send them a congratulations card, I find out that they paid $319,000 for it. Hmmm. You decide! It happens waaaaaaaaaaaaaaay too often.

My wise old grandmother told me that people like about money, sex, and politics. I think she was right.

Silvia,

I do not see many homes selling waaay below list price.. Every once in a while someone will low ball one and it is accepted. 

They usually sell somewhere in the 90% to 100% range, is what I find in my area.

Great stats for your area.

Ahhh...a Realtor who knows her numbers!  I agree Silvia, if it is priced right it will sell--no matter what the market.  My mentor taught me if my listing got 2-3 showings a week I was priced right.  I asked him..what about a down market...his reply "2-3 showings a week"...I asked about an up market...his reply "2-3 showings a week"

Hi Silvia:

Great post!  If the property is priced correctly, it will sell.

We all have hear the ridiculous stories of people buying properties for a fraction of the price.  Then the public thinks it applies to all properties. 

It's a crazy time in our business!!!

Lyn, thanks for your comment. Yes... it's just "once in a while"!

Martin, who wants or needs "listings for life"? What a concept. ;-)

Renee, in our area I find that the "normal" sellers are starting to get realistic as well.

Russel, well said. I like your wise old grandmother!

Judi, same here, low balls take place but most times don't end up taking the price. Thanks for stopping in.

Debbie, with two to three showings a week, a property should not stay on the market very long.

Toula, I agree and people are just too happily inclined to believe the crazy stuff!

 

The only homes that do sell way below list are the ones that were originally way over-priced, which, if they had priced them correctly in the first place they would have gotten more for.  Anything in the good areas here go into multiples immediately. 

MLS Stats for north Sacramento zips 95838 and 95815 July 21st to October 18th. Cheapest sales (under $66,000)

Average sp / lp was 100.66%. This was a sample of 95 sales. 

The range was a low of 35.33% to a high of 184.76%

24 of the sales (25%) were at 100% or within 1% of LP 98-102%

15 (16%) were under 90% of LP,  20 (21%)were more than 110% of LP.

Jims mantra: List prices are not neccesarily correlated to value. Sometimes they are way low, sometimes they are way high. Sometimes they are (seemingly randomly ) spot on.

Jane, that is the sad truth that many sellers realize too late. Overpricing may result in underselling.

Jim, the numbers for your area are looking quite good. Thanks for stopping in and sharing!

Silvia. Some of these Buyers need a strong reality check. I usually refer out the unrealistic clients to coworkers (30% to me if they crack the nut)

Marc, you must be a popular guy! lol 

Would be interesting if you added the average original/median list price to your analayis.  How many sellers are pricing correctly to begin with versus riding the price down to true market value?

Rod, I agree it might be interesting to see the original list prices. Our MLS system unfortunately doesn't allow this search capability and to go through the listing history of approximately 1500 sold properties one-by-one would be time-prohibitive. 

Are sellers who are  "riding down the market" really serious sellers in the first place or do they become serious once they do come down to a realistc price which would be the list price at time of sale?

In my opinion Sylvia, they don't. Those lp/sp ratios are very similar to our areas here in the Sacramento, CA region. I'm convinced, trying to convince our buyers is another story! DeeDee Riley

Hi Sylvia: My two cents - bad house yes and good houses no.

:)

I see Matt's response above mine, but we've been seeing a lot of bidding wars here lately on the bad houses, so even they are not selling at bargain basement prices.