Seller Home Price Issue? Let A Simple Stat Make It Easier

By
Real Estate Agent with Keller Williams Realty

You go into a listing presentation with a well prepared CMA.  Your value recommendation is well presented.  The next discussion is if you anticipate receiving a certain range then where should the home be priced positioned?  You need another piece of the puzzle before that decision can be made.  What does the market inventory levels look like and what should I expect in terms of when my home will sell? 

The below chart is information easily obtained from MLS. Simply run MLS for the different price levels in a desired area for the same quarter time period each year.  This chart is a history of sales information comparing the same quarter to previous years since the year 2000.  The higher the month supply of homes, the more competition there is on the market.  The more completion the more flexible you need to be in pricing or more of a stand out home in terms of amenities, condition, etc. 

This chart reflects the market for Plano, Texas.   It shows us that the market is fairly similar from the year 2008 to 2009 in all price range levels.  That the more affordable the home, the less competition.  This is an excellent chart to demonstrate that the Plano, TX market is very stable.  This chart validates what many of the National sources have cited, that the Dallas/Fort Worth market is for the most part stable.  If it were stressed the inventory levels would be increased. 

One fact to be aware, less homes is on the market but there are also fewer buyers.  This has helped to maintain the stability. 

Is this a day on market study.  Not complete.  As we all know, days on market for a listing is a factor of proper pricing, staging, condition. 

I have found that this information paired with how many homes are currently for sale in the competitive price range and under contract are huge assets in helping the owner price the home to sale.  They realize that there is competition and the reality of numbers brings that to perspective. 

 

Cumulative Months Supply for Selected Areas

Area

Price Rng

1Q '00

1Q '01

1Q '02

1Q '03

1Q '04

1Q '05

1Q '06

1Q '07

1Q '08

1Q '09

20 - Plano

$060-$099

1.4

0.8

2.0

3.0

2.6

2.8

1.7

2.5

4.5

3.1

20 - Plano

$100-$149

1.5

1.6

1.8

3.1

4.9

4.1

3.3

2.7

3.8

3.2

20 - Plano

$150-$199

4.1

2.7

2.8

4.3

4.7

3.4

2.9

2.8

3.6

2.6

20 - Plano

$200-$299

4.3

4.5

4.5

4.8

5.3

4.0

3.1

3.5

3.8

4.0

20 - Plano

$300-$399

5.9

3.7

7.1

7.2

6.0

5.5

3.6

4.7

5.1

5.3

20 - Plano

$400-$499

6.3

3.6

6.1

6.2

6.0

6.1

8.5

6.1

7.2

6.0

20 - Plano

$500-$700

7.6

4.6

5.8

8.2

7.0

7.8

5.7

11.2

9.5

8.5

Comments (1)

Derenda Grubb
CENTURY 21 Mike D. Bono & Co.'s - Lake Charles, LA
GRI, ABR, CRS

Hi Connie,

I am not sure, but it seems that you are calculating the market absorption rate?  Is that an accurate observation?  This is a very helpful tool for both the agent and the seller.  Good post. 

Feb 04, 2009 06:21 PM