Do Washington Overpriced Listings Take Longer to Sell and Ultimately Sell for Less Money?
To answer this concern, we evaluated all the houses that sold in Washington in 2019 and took a look at the data from a number of angles. The very first part of the concern, that overpriced listings take longer to sell, was fairly direct to address. From the data, we might count the number of days a house was on the market and then compare that figure against the actual offered rate compared to the initial cost the house was noted for.
The second part of the concern, nevertheless, was far more difficult to respond to because how can you show that a home eventually sold for less cash? Let me discuss. Let say you had 2 homes that both sold for $500,000. The very first house was listed for $490,000, however sold in a few days, over sale price of $500,000. The 2nd home was listed for $525,000, but offered in 30 days, less than the list price of $500,000. Both houses ultimately cost $500,000, but did the second expensive house sell in fact for less money or did it just sell for what it deserved?
To address the 2nd part of this concern, ideally, we would have 2 similar houses to compare. The first house would be priced at market value and the 2nd house overpriced. Then we might compare the outcomes based on the offered cost of both houses. In property, nevertheless, no two houses equal, so we used a dataset of a similar type of home sold in Washington for this analysis. In this case, we analyzed all the Detached homes in Washington that sold in 2019, which was a total of 1,450 houses.
Method for Analysis:
The initial step was to sort of the data by the days on market, least expensive to greatest. Next, we organized the houses into 4 groups based off their days on market: less than 7 days, 8-14 days, 15-30 days and 30-60 days. The first group, which included houses that were on the market for 7 or less days, amounted to 508 houses. The 2nd group had 265 houses and consisted of all houses where the days on market varied between 8 to 14 days. The 3rd group had 248 homes and consisted of all homes where the days or market varied from 15 to 30 days. The fourth group had 200 houses where the days on market was in between 31 and 60 days. For this analysis we selected to exclude the homes that took longer than 60 days to sell because when 84% of the homes sell in less than 60 days, there is no factor for a house to just sit on the marketplace without selling and might allude to other concerns with the home.
Table 1: Days on Market for Detached Homes in Washington
|Days on Market # of Homes%|
|of Homes 1-7 508 35%8||-14|
|265 18 % 15||-30||248 17%|
|31-60 200 14||%Overall 1221 84%|
To respond to the first part of the question we calculated the ratio of the Sold Price (SP) to the Original List Price (OLP) for all the homes. We then took the average for each of the 4 groups. The lead to the table below confirm that the longer a house rests on the market, the less a seller is getting for their house. Houses that sold in 7 days or less, cost 100.7% of their sticker price. Homes that sold in between 8 and 14 days sold for around their asking price. Houses that took longer than 15 days cost less than their asking cost.
Table 2: Median Sold Price to Original List Price for Detached Homes in Washington
|Sold Price to||Original List Price 1|
|– 7 100.7%|
15- 30 97.6 %31-60 95.3%Overall 100.0 %The data, nevertheless, alone does not inform you whether a seller is in fact getting less cash for their house. For houses that offered in more than 14 days, the data would seems to show that these houses were overpriced, which would discuss why they took longer to offer and that they likewise cost less than their asking cost. This information alone, however, does not reveal if these homes really cost less. To determine that we would require to look at both the original list price and the last offered cost.
Table 3: Median Sold Price for Detached Homes in Washington
|Days on Market Offered|
|Price||to List||Price List Price||Offered Price Distinction 1-7 100.7%$|
|921,750$950,000$6,450 8-14 100.0%$789,000||$790,000||$0|
|15 – 30||97.6%||$749,000||$720,000||-$17,980|
|31 – 60||95.3%||$749,950||$720,000||-$35,250|
Let's breakdown the data from this table: Overall the typical initial sticker price all these removed homes was $829,620 and the average offered rate was $825,000.
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Insight # 2: The Best Chance For Getting Top Dollar Is Selling In Less Than 9 Days
The longer a house rests on the marketplace, less desirable it becomes in the eyes of purchasers. Because homes are flying on the marketplace, if a house rests on the market longer than 14 days, to any potential purchaser on the marketplace, they automatically presume something is wrong with the house. This equates to lower offer costs, which you can see above, however likewise increases the seller aid at closing. In the table listed below, we've consisted of the typical seller subsidies and you can see the longer the house sits on the marketplace, greater the typical seller subsidy that is provided to the buyer to offer your house. We've also upgraded the table to show the median adjusted sold rate, accounting for the seller aid. For the homes that offer in less than 7 days, these are the most preferable homes, most likely have numerous offers and are netting the like above. For all the other houses, they are all netting less, so for the homes that sell in 7 to 14 days, they may not be getting multiple deals, however due to the fact that it is a hot market and they are priced well, they are netting $8,990 less than the asking cost, not $0 as above.
Table 4: Median Adjusted Sold Price for Detached Homes in Washington
|Days on Market price||Subsidy Adjusted Sold Price Difference|
|1 – 7||100.7%||$1,850||$948,150||$4,600|
|8 – 14||100.0%||$8,990||$781,010||-$8,990|
|15 – 30||97.6%||$9,780||$710,220||-$27,760|
|31 – 60||95.3%||$1,980||$718,020||-$37,230|
About Peggy Yee
Peggy Yee is a supervising broker at Frankly Realtors and is a local Top Producer. She has sold over $180 million in sales and was among Northern Virginia Magazine's Top Realtors since 2015. She has actually been estimated in the Around Reston Magazine, Washington Post, Money Magazine, Consumer Reports, Zillow, Trulia and Realtor.com. Peggy is 100 % dedicated to making your move the best experience possible! Don't just take our word … Click here to see what Peggy's past clients need to state about the experience working with her from Buyer and Seller Video Testimonials and you'll comprehend why she is among the leading realty representatives in Washington with dozens of 5 Star Zillow evaluates. Click on this link for Zillow Reviews. * Data Source: BrightMLS. Info considered trustworthy however not guaranteed.Source: patch.com