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Days on Market: It's a Matter of Price

By Don Fabrizio-Garcia

Real Estate Agent with Fab Real Estate

June 24, 2007 05:13 AM

In preparing my monthly Market Condition Reports for the area towns surrounding Candlewood Lake here in Connecticut, I've noticed a continuing trend between Days on Market and Original List Price vs. Final Sales Price.

With the exception of new construction (which typically takes longer to sell due to the construction time, and often sells at a premium over resale homes), nearly all homes that were on the market for more than 150 days, ended up selling for $50,000 - $100,000 less than the original list price. Some sold for $200,000 less than the original list price and sat on the market for more than two years.

The average Days on Market here in the Candlewood Lake area of Connecticut fluctuates between roughly 90 and 140 days. The average List Price vs. Sales Price ranges from 92% - 98%.

Overpriced homes will fall nowhere near these averages. Some overpriced homes have sat on the market for more than 700 days. That's more than two years. That's a lot of extra time to carry the costs of the home. That's a lot of extra time to keep the home in top showing condition. That's a lot of extra stress and unneeded turmoil. And it prevents you from moving on with your life.

What's the solution? It's simple:

Price the home properly and sell it quickly!

Need help determining the best list price for your home? Ask your agent to prepare a complete Comparative Market Analysis of your property. By utilizing recent sales in your area and making adjustments for the differences in size, location and amenities of the homes, your agent should be able to determine the most likely sales price for the current market.

Still not convinced? Then hire an appraiser. The buyers' lender will hire one after their offer is accepted, anyway. If the home won't appraise for the list price you're asking for, then the deal won't be successful anyway.

Selling your home is stressful enough. Don't add to the stress by overpricing your home. Buyers will not pay more than your home's current market value.

Don Fabrizio-Garcia, REALTOR
Connecticut Real Estate & Appraisals
CT Home Group
Keller Williams CT Realty
203.746.1199
Connecticut Real Estate and Homes for Sale

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Michael Eisenberg

eXp Realty - Bellingham, WA

Bellingham Real Estate Guy

Well said, overpriced homes take a long time to sell, if they sell it all. Price it right now and it will sell quickly

Jun 24, 2007 09:15 AM

Don Fabrizio-Garcia

Fab Real Estate - Danbury, CT

Owner/Broker/Trainer - Fab Real Estate

Michael - You get it!

Jun 24, 2007 10:58 AM

Todd Murphy

Fitts Agency - Tuscaloosa, AL

Amen, amen, amen!!!! I have two homes, both priced over $500K that are expiring and the clients are pissed off because of lack of showings, and no offers.

From this point forward, I will not list a home unless it is priced to sell in thirty days or less.

Jun 24, 2007 11:44 PM

Todd - Overpriced listings will not sell, or will only generate extreme lowball offers. It's a disservice to our clients to accept listings at a price that won't sell. You'll do good as you move forward!

Jun 25, 2007 02:43 AM

Catherine Myers

Windermere Bay Area Properties - Walnut Creek, CA

Walnut Creek, CA Real Estate

Heck, here we don't even get low balls.. the buyers just sit and wait and figure when the seller gets realistic , then they'll make an offer. In Concord, we have just a 10% ratio of active vs. pending - 10 months of inventory! Walnut Creek is a bit better at about 4 months.. but I'm with Todd, unless sellers are pricing to sell, I'm not interested in taking a listing that is overpriced and is promised to sit and sit and sit.... Funny enough, our high end is going like gang busters... its the low end that has been hit HARD .... by the sub prime fiasco, by the number of defaults, short sales, REOS, and by the flood of inventory as owner's aggressive adjustable rates are readjusting... I think its going to get a lot worse, before it gets better...

Jun 25, 2007 04:00 PM

Hi Catherine - Most towns around here have a 9-10 month supply of homes currently on the market. It's not awful, but it's not great, either.

I'm surprised your low-end properties are struggling with the market. It's the opposite here. Though, I'm thinking it's because our low-end properties are a lot cheaper than yours!

Our high-end homes, which are typically larger new construction homes, or lakefront properties, are typically sitting on the market longer than others. These are often near or above the $1,000,000 mark.

I don't know that it's going to get worse. We're seeing anecdotal evidence that the market is picking up some steam - lots more buyers, our phones are ringing, and a few multiple offers on competitively-priced homes. Our closing times are usually 60-90 days around here, so it will be several months before we can say for certain if things are picking up.

Jun 26, 2007 07:21 AM

Paul Campbell Realtor Lexington

Rector Hayden, Lexington, Ky - Lexington, KY

Kentucky Homes for Sale

Hi Don,

I have seen a number of homes that sold for much less when on the market. I have been intrigued with this market condition and started doing some sysematic research on key areas this week. I am not done but have discovered some interesting bits that I really had no idea existed. One of them is that some of the higher priced homes seem to do better when on the market a longer time. No hard and fast rule here but trends.

Feb 05, 2010 02:17 AM

Paul - I'm assuming that by higher-priced homes, you mean homes at the upper-end of your market. In our area, these high-end homes do take considerably more time on market to sell. Anecdotally, this may be because the buyer pool for the high end had dwindled so much over the past few years. So, even a well-priced high-end home will sit longer on the market, but may very well sell close to it's list price. It doesn't necessarily mean the home is overpriced, but rather it may mean that the market for that home is so small today, that time is a necessity.

Feb 05, 2010 03:00 AM

Days on Market: It's a Matter of Price

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