The Longer a House Is For Sale Impacts Selling Price

I see dozens of homes and condos in any given week and there are two things which I always immediately look for:

  1. The Listing Price
  2. How Long Has it been for sale

When my clients and I are looking at a home these two key metrics are always critical indicators whether the property is properly priced and reflects its true market value.    If a selling agent and the home owners are market savvy they understand that during the first 10 days on market an accurately market priced home will sell in most instances either at full asking price or above.

Just like dating, you have only one opportunity to make a good first impression.  I have put together a great graph which truly illustrates what happens to a property’s selling price as the days pass by.

Graph Days On Market First Ten Days

As you can see, the first 10 days creates the best window of opportunity for a homeowner to secure the best-selling price.  The house is fresh and it’s during this period you have the greatest number of  buyers keen to view it.   But no matter how well the home shows, the biggest factor is whether this property is worth the asking price.  If the property is attractive to its targeted buyers and priced at exact market value, then the potential exists to sell above or at asking price.

 

Day 11 to 25

The open houses have come and gone and so have the agent/buyer showings, but the anticipated plethora of offers never transpired. What buyers and sellers can now expect are negotiated offers.  Here is where homes which sell are ones where offers are presented for less than asking price and the seller counters.  These are always the best deals, as both the seller and the buyer are able to mutually come  to a fair deal.  One where it is Win Win and not one of take or leave it.  Remember the longer the home stays on market the less buyer interest it attracts.

Day 26 to 30

At this point the seller is questioning their agent of “Why is my house not selling?”  The standard realtor answer is the property is “The property is overpriced and it requires a price reduction”.   So what happens is the seller drops their original listing price by between 2.5% to 5% in order to revitalize the listing so as to attract buyers once again. However, what occurs is a slight spike of average selling price jumps up by 1%.  What this represents are those homes which were slightly overpriced, and now reflecting true market value, attract the right buyer and a negotiated offer is achieved.   But just think, if they had priced their home at this price originally they would have sold within 10 days and not 30, as well they might have gotten asking price or above.

Day 31 to 75

Now this is the place that no seller wants to go….the listing becomes invisible.    Mls traffic drops, open houses attract one or two drive-bys, agent booking are almost non-existent and potential buyers start to ask themselves “What’s wrong with the house?”   You can see that each day an overpriced home lingers the lower its potential selling price.  And after 75 days it drops off into the abyss.

So back to the beginning.  Like dating make sure before you list ensure that your home is accurately priced and as well will be attractive to your strategic buyer market.  It will save you a lot grief and get you the best price.