Market Data Confident Sellers Know

We’ve settled into a very different real estate market, and while sensational news stories might lead people to believe that the sky has fallen, homes are still being bought and sold with great success. Sellers, many holding record high amounts of equity, are doing well. However, there’s some added stress in a market where homes sit for longer than one weekend that can lead to knee-jerk reactions with the potential to signal distress and leave money on the table. Knowing the market data can prevent that, so here’s a look at the data that I collect, track, and disseminate for my sellers.

Median Days on Market

Median days on market is the number of days that most homes are actively listed before they go under contract for purchase. Knowing how long it takes most local homes to go under contract helps a seller know when to hold firm and when to consider adjustments. For instance, if the median days on market for comparable homes is 16 days, a seller shouldn’t consider a price reduction until they’ve surpassed 16 days on the market.

Average Showings to Pending

The average showings to pending is the average number of times a home was privately toured by buyers with an agent before going under contract for purchase. Used in conjunction with the median days on market, it can help determine if a listing’s activity matches comparable listings and meets, fails to meet, or exceeds expectations.

Neighborhood List Price to Sales Price

The list price to sales price, expressed as a percentage, tells the story of current negotiation trends. It shows what homes are selling for in relation to their list price. For instance, if local comps are selling between 97.7% and 100.8% of their list price, a home listed at $730,000 would have an expected sales price between $713,210 and $735,840. This data should never be used to manipulate a sale by pricing a home higher than its market value. After all, the homes that sell at the lower list to sale price percentage likely did so because they priced too high initially. These percentages are better used to evaluate offers that come in to see if they fall within the norm and to inform a seller’s response and negotiation strategy.

Change of Seller Paid Closing Costs

The change of seller paid closing costs is simply the percentage of comps where the seller paid all or some of the buyer’s closing costs. It’s another piece of data that helps sellers evaluate an offer by its relationship to the current market norms. 

Number of Comps, Condition, & Pricing in Relation

Sellers should know how many local listings can reasonably be considered competition and how the list price of their home relates to the competition. Before responding to an offer or considering a price reduction, a seller should be familiar with the competition and comfortable with how it compares.

Up to Date Listing Activity

Up to date listing activity includes the current number of private showings, feedback from buyers and showing agents, and recent market movement; what has gone under contract, what has entered the market, and what has sold and if that data shifts the listings position in relation to competition in the market.

At the end of the day, a home's true market value is the amount that a ready, willing, and able buyer is willing to pay and the seller is willing to (or must) accept. That can't be manipulated or controlled with data, but sellers can use the data to make smart moves. Market data provides the basis for making informed, business decisions and helps to alleviate the stress and uncertainty that sellers can feel when their house is on the market.