Agents have their fingers on the pulse of the market. Since we sleep, eat, and drink real estate, day in and day out, we have a feel for the market.
There’s no other way to explain it. The data can remain consistent from week to week and month to month, but agents with “boots on the ground” have a sense when the beat is slightly off.
Over the past 6 weeks, the Triangle Multiple Listing Service (TMLS) data has been consistent regarding the number of active listings, months of supply, and days on market on a week to week basis.
But something’s not right. The number of price reductions or as many agents will say, price improvements, has been escalating. And unfortunately, I don’t have the numbers for price reductions but that goes back to my point, good agents have their fingers on the pulse of the market and can sense when the beat is off.
It’s also helpful that I work in an office (a big shout out to West and Woodall Real Estate) with some top notch / top gun agents. They’re truly some of the best you’ll find in the Triangle. And when we all start sharing this feeling, it’s not a coincidence.
Along with the higher than usual number of price adjustments, the number of buyers has appeared to diminish too. So, is there data to back up our feelings? Of course there is. You really didn’t expect me to say “no” there, did you?
Let’s look at homes priced between $100,000 – $400,000. I chose this range because more than 73% of all showings are for homes in this price range.
Over the last 90 days, homes in this price range averaged almost 9 showings per listing. Now, if we just take the last 30 days, the number of showings per listing was only 5.66. That’s more than a 36% drop in the number of showings per listing! So our feeling that the buying pool is starting to dry up was correct.
Fewer showings means more days on the market before a home sells. Sellers put their homes on the market anticipating it to sell in X number of days because that’s what the data was telling them. Sellers need to be in their new home by such and such a date so what do they do? Reduce the price to make that date. And maybe several price improvements.
Also, as we enter the “slow time of the year”, sellers need to understand the odds may be stacked against them. Now please, I’m not by any means suggesting sellers do not put their house on the market at this time, that’s not what I’m saying. In fact, there are many reasons why a seller would put their home on the market now but I’ll leave that as a topic for a later post.
All I am saying is the odds of selling your home has slightly decreased over the last four weeks. A month ago, a seller had a 73% chance of selling their home whereas today, they have a 69% chance of selling.
So what does this all mean? It means you, as a seller, need to hire a knowledgeable, professional, full-time agent that has their fingers on the pulse of the market.
That agent could have advised you on the price reductions taking place in the market along with the decreased traffic and lower odds of selling your home so together you could agree to price your home ahead of the market. Your home would be priced correctly to increase foot traffic and therefore, increase the odds of selling your home so you could meet the deadline of being in your new one.
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