Welcome to the roller coaster ride for Hanover Park Homes! In this gyrating edition of June's market update I'm going to decipher for you the current market trends (cause that's what I do) and tell you about time on market. A more complex word that some use might be 'absorption rate'. So how long will it take your Hanover Park home to sell?
Let's begin with the use of the economic basic of supply and demand. Obviously in this market we have too much supply. When that happens the time it takes to sell your Hanover Park home also goes up. Buyers have a tremendous amount to choose from on the market but don't be fooled they are 'ready to pull the trigger' if they see something they want!
Pricing your home correctly in the beginning has many advantages as these graphs will illustrate to you. The best sales time is in the first 30 days of your homes listing life. Price is the dominate factor in getting your home sold, then condition and location for that price.
Twenty six (26) Hanover Park homes or 32.5% of the market sold in the first 30 days. That's terrific for our area! Success percentages become less as the market times become higher (time to check the graph now). At 150 days on the market, your Hanover Park home is basically dead in the water. At 200+ days on the market your for sale sign now says 'rest in peace'.
In fact to drive this point 'home', there are Hanover Park homes that finally sold after being 481 or more days on the market. Yes, I rechecked all these market times (that's 1 year 3 months) because I thought it couldn't be possibly correct. My calculator unfortunately was not wrong! Many of these homes had 20%, 30%, 50% in price reductions off original list before they finally sold. Don't be one of these sellers that just didn't get it right!
Real Life Hanover Park Example - Very nice ranch home that sold in a regular sale (not a short sale) and took 295 days. During that time they reduced the price on their home $65,000! So they started off at a price of $200,000 and eventually closed at $146,000. Making the example more odd the buyers closed at OVER the listing price which by then was whittled down to $135,000. I'm sure that if they were just a little more realistic with the pricing of their home the process wouldn't have taken that long. The longest short sale closing was 481 days on the market (that's 1 year 10 months folks).
Days 1 to 30 - Slight price reductions and sales prices were 2% to 12% off list price. A few sales were at list or OVER list price on foreclosures up to 17%.
Days 31 to 60 - Many homes had reductions of at least 4% to 10% off their original price.
Days 61 to 90 - All homes had reductions in this category also from 6% to 10% off their original price. After 60 days on the market a price reduction is warranted no matter what the market's like.
From 90 to 120 - All reduction percentages are at the 12% to 29% range. At this stage of marketing time, sellers begin to wonder what is wrong with their home. This the beginning of what I call the 'stall out phase' where buyers are no longer coming to see your home.
From 121 to 150 - Sellers seem to be in a fog about what to do about their price. Continued 'stall out phase'. All reduction percentages are in the high teens, twenty's, up to 50%.This is the smallest segment of the graph which is troubling. This is where sellers start to 'chase the market' downward. Instead of being 'in' the buying mix with a correct price, sellers are continuing to change the price downward while other sellers also change their price. Talk about a slippery slope!
From 151 to 180 - This is where the real roller coaster ride begins for sellers. What to do? Price changes near 37 to 52% as buyers are just saying 'no' to that sellers price.
So at this particular time the graphs show you that if your Hanover Park home is priced correctly from the start there is a great chance of your home selling within the first 120 days. No feats of magic required - just a good home, with a good price, in good marketable condition.
The Price-Time Graph shows that over-pricing your Hanover Park home initially can have a serious impact, not only for time on the market but also on your bottom line. Your sales net is tremendously effected in lost time and lost value.
Looking for an agent that's really a market expert? Let's get your Hanover Park home on the market and priced right to sell!
Looking for a home in Hanover Park? Please give me a call or email me to talk about the possibilities.
Market Update for Northwest Suburbs
Debe Maxwell, Charlotte NC Contributor and Top Agent
MRED June Stats 2011