Many Buyers AND their Realtors, are still buying into the multi-offer, way over asking price market. I’ve been tracking our market here in the “Wine Country” of Sonoma County (2nd county above the “Golden Gate” and we are seeing a distinct “Shift”. If you refuse to know your market numbers you are committing malpractice. How can you advise your clients on the proper pricing and strategy when you do not follow the market and its trends? I’ve had many buyers tell me homes come up and fly off the market. They think all homes sell in two weeks. Realtors are aiding and abetting this myth by buying into the hype. We have Realtors who refuse to make a low ball or under asking price offer thinking they’ll not even get looked at. Others won’t even think about presenting a VA or FHA loan and a sales contingent upon the sale of a buyer’s home; they shudder at the thought.
But let’s look at the facts. Not ALL homes sell. “No kidding Mike!” But have you asked your buyers what they think? Many buyers and sellers think all homes sell. Do you highlight the “expired” or “withdrawn” listings for your listing appointment? How far are you going back for comparables? Lastly, are you informing your seller as to the “odds” of selling their home? Here’s a great example on how to figure the “odds” or percentages of you selling:
1. Search MLS for all homes in the High School District between $250,000 $275,000 in the last 6 months.
2. 53 were closed in the last 6 months
3. 128 entered the MLS and were sold, expired, withdrawn or still on the market
4. 53 divided by 128 = 41% of the homes that entered the market sold! CLICK HERE to go to this tables source!
The above calculation can assist you with both Buyers AND Sellers. Buyers will get that not all homes sell and therefore may be an opening for a great deal. Sellers? Price the home correctly, watch the market closely and react immediately to the latest comparable that does not prove your price. But from the Buyer’s stand point we need to educate folks that the cute, little flip with the shiny stainless steel appliances and mirrored tile will draw huge crowds and is what EVERYONE wants! This demonstrates a truism—in ANY market there is the house that draws a huge crowd and can sell over asking. But here in Sonoma County I refer my buyer’s to those listing gathering dust on the shelf.
We currently have only 749 “Active” or “Showable” single family detached listings on the market. This is for a county with a population of 480,000; every city, every MLS area. Analyzing this inventory is worthwhile and will show your buyers a powerful strategy and your sellers the futility of over pricing their house. There are now 119 houses in our county which have been on the market since June 1 to August 31st or roughly 35% of our current “Active/Showable” listings. These Sellers have been sitting waiting for an offer from you! WHY show the brand new shinny object? Get them out to take a look at the “dogs”, the houses rejected by the market. You might find some great deals. Perhaps they’ll cooperate with a VA or FHA loan. Help you with closing costs? Sure—I’d ask. Or maybe they’ll accept your contingent offer subject to the sale of your existing house. Doesn’t hurt to ask. Don’t ever negotiate with yourself! Remember what Zig said, “Shy Sales people have skinny kids!”