I would like to take a minute to talk about listing luxury properties. In my market in the Cedar Rapids/Iowa City area, this includes homes that are priced above $500,000. These sellers expect and deserve the best market exposure possible. After all, in my market, this is the portion of the market that has the smallest pool of buyers and the longest absorption rate.
Currently, there are 49 listings that are priced at $500,000 or higher out of 2052 listings in the MLS. Last year, 35 sold with an average days on the market of 159 days. The current days on the market for the 40 active listings is 150 days....Let that sink in for a minute. There are currently 49 listings on the market that have already been on the market for 150 days. This means that if no other properties come on the market, we are already almost past the average days on the market in the last 12 months. And let's be realistic, this is only January. There will be more homes on the market by March and very few will be sold by then.
So creating demand in this market is very difficult to say the least. The pool of buyers has greatly diminished, even though the interest rates have remained low. The average buyer that is relocating from California, is selling a home that is in the $700,000+ price range, however they are purchasing a home that is less than $400,000 here in our market. Why? They can get so much house for that price! And there is no need for such extravagant homes for these young families. The real estate crisis has made buyers more cautious about what they can afford and what they need.
Best of luck to sellers that are in this price point. It takes a lot of extra effort to reach these select buyers that are shopping for your home. Do your research and ask the right questions as you are interviewing an agent to represent your home. It is not impossible to sell your home in this market, but it is essential that your home is seen everywhere, marketed to the agents that have the buyers, and very professional photography and marketing!