by Ken Brand, Sales Manager - Prudential Gary Greene, Realtors / The Woodlands TX / Cell: 832-797-1779 on May 13, 2009
Is It A Buyers Market or A Sellers Market?
Numbers are tricky. They can tell you a lot and they can fool you too. For example, you read articles, watch talking TV new bobble heads and listen to people talk about National Average Sales Prices, Housing Starts, Big City Foreclosure Reports, etc. The relevant reality is, real estate is hyper local. It doesn’t matter what is happening in San Diego, Sacramento, Phoenix or South Beach, what matters is what is happening in your neighborhood. Period.
Monthly, we release a collection of reports for The Woodlands TX. Reports include statistical data on Average Sold Price, Months Supply Of Inventory, Median Sold Prices, Average Days On Market, Broker Market Share and more. But here’s the deal, even in a tightly defined geographical community like The Woodlands, averages only give you an general idea of trends. What really matters is what’s happening in your neighborhood and your price range. If you really want to know what impacts the specific price of your home, call your favorite Realtor and as them to do a market analysis for your specific property.
Here’s an example of what I’m talking about. This evening, at 8:16 p.m., I ran some statistical Months Supply Of For Sale Inventory reports using our Houston Association Of Realtors, Multiple Listing Service. This data is for single family homes in The Woodlands TX. The Months Supply Of For Sale Inventory for all price ranges is 6.2 months. Here’s the by price range breakdown. Keep in mind, while this snapshot provide a more refined picture, what is happening in your neighborhood could very well be different. (Oh, just to be clear, Months Supply Of For Sale Inventory is how long it would take to for the current For Sale inventory to sell if no new inventory came on the market and the velocity of sales remained the same.)
Price Range Months Supply Of Inventory
$000,000 – $200,0003.2
$200,001 – $300,000 5.5
$300,001 – $400,000 6.2
$400,001 – $500,0007.1
$500,001 – $600,000 7.3
$600,001 – $700,0007.0
$700,001 – $800,00015.0
$800,001 – $900,00012.4
$900,001 – $1,000,00015.5
$1,000,001+23.6
What’s It Mean?
Real estate economists believe that 6 months supply represents a balanced market. A higher number means it’s leaning towards a buyers market, less of course would be a sellers market. If you’re a seller and your sales price is under $400,000, you’re in fair shape. The more expensive the home, the more competitive the market. Things that effect salability and competitive positioning of the property include, marketing, merchandising/staging/presentation and pricing. Tweak and amplify those three factors and you’ll be one of the successful sellers attracting a qualified buyer. Ignore one, two or three of the salability factors and the property will languish.
As I shared earlier, to understand what your specific situation is, contact your favorite Realtor. Also, take a look at this collection of Real Estate Reports, they are The Woodlands general in nature, but you’ll find the Broker Market Share numbers interesting. Prudential Gary Greene is the leader above $250,000 and the higher the price range climbs the more dominant and succeful we are at matching buyers and sellers.
If there’s anything I can do to help or if you have a question, give me a call: Ken Brand 832-797-1779
by Ken Brand, Sales Manager - Prudential Gary Greene, Realtors / The Woodlands TX / Cell: 832-797-1779 on October 5, 2008
September’s real estate market sucked lemons. Hurricane Ike plus the Wall Street meltdown tranquilized the market. I see evidence that the hangover effects are ebbing, activity and action shouldl improve in October.
Here’s a snap shot of what happened. (Statistics obtained from the Houston Association of Realtors, Multiple Listing Service – Market Area =The Woodlands, Texas)
Contracts written on listings fell 29.5% in September. The total number of September 08′ written sales = 117 / September 07′ written sales = 166
Listing Inventory fell by 10% as well. There are fewer homes for sales today than last year at this time. Active listing inventory on October 5th, 08′ = 800. This is good.
There is a 5.1 month supply of available For Sale inventory. Real estate economists believe that 6 months of supply represents a balanced real estate market. The Woodlands Texas real estate market is skewed towards a seller’s market – still.
Average Days On Market for Sold Listings in September bloomed from 57 Days On Market in September 07′ to 80 Days On Market for September 08′. Not too shabby.
Average Sold Price in The Woodlands Texas for September 08′ is $375,706. Average Sold Prices have slowly and steadily risen 26.8% over the last two years. This is positive.
The Average September Sold Price To Original List Price Percentage for The Woodlands Texas = 96% (The Prudential Gary Green Average leads all major brokers in The Woodlands, Texas. See market share reports below).
Bottom line = September sucked for written sales. For Average Sold Prices and Listing Inventory, September was fine. October results should bounce forward.
by Ken Brand, Sales Manager - Prudential Gary Greene, Realtors / The Woodlands TX / Cell: 832-797-1779 on August 4, 2008
You property listed “FOR SALE” and you’re wondering if you should reduce your asking/listing price.
Here are four key things to consider in answering the question of price reduction. As an example, I’m going to include some statistical information for the market I work and play in, The Woodlands, Texas. The philosophical approach using accurate data will work in all real estate market.
Let’s start with a few important qualifiers before we dive into the hard facts. Things that effect salability you probably know; location, condition, price, marketing/advertising. You can’t change the location, let’s assume you’ve taken smart steps to merchandise and stage your property and you have a savvy real estate agent marketing/advertising/promoting like a crazed banshee. What’s left? Adjust the price.
All sellers grapple with the difficult task of pricing. Here’s four factors to help you decide intelligently.
1. Find out what the Average Number Of Days On The Market is for all “active listings” in your general market. You should also narrow it down to your price range and even your specific neighborhood. (A savvy real estate agent can provide you with this information.)
EXAMPLE: The Average Number Of Days On The Market (ADOM)” for all active listing inventory (908), in all price ranges, is 85 Days. (The Woodlands, Texas – 10:25AM, August 4th, 2008)
Let’s say you had your property listed For Sale at $549,000 in The Woodlands, Texas. The ADOM for all actively listed properties between $500,000 – $600,000 is 91 Days. In this example, using your data for your property in your market area, if your property has been on the market longer than the average – Adjust The Price Now! Do it today.
What’s the first question a buyer asks when they walk through your door? Answer: How long has this home been on the market? Don’t let the answer be, “longer that average”.
2. Find out what the Average Number Of Days On The Market is for all Closed Listings in your general market for the last 30 days. These ADOM numbers from closed sales will reflect buyer activity (contracts written) from 30 to 60 days ago. This number will tell you what ADOM were for properties that qualified buyers choose over all the other available homes.
EXAMPLE: In The Woodlands, Texas during the month of July there were 255 Closed Sales, the Average Number Of Days On The Market was only 55 days. Using the same mythical listing price of $549,000 the ADOM is 65. If you’re seriously motivated and you want to move and your property has been on the market for more than 55 days…you would ACT NOW.
3. Take a look at the seasonal pattern for your area. In our area, as you can see from the graph below, New Contracts Written peak in May, June and July. Buyer activity naturally ebbs as school begins and the holiday season kicks off. This means there will be fewer qualified buyers in the market place. If you want to be one of the sales that happens next, consider a price adjustment today, not next month.
4. Consider how showing appointments are trending in your market place. Taking into account the seasonal flow of qualified buyer traffic, is there any reason to believe that more buyers will appear or enter the market place? If the answer is no, adjust you price today.
OK, that’s alot to swallow, it’s bitter too. Experience tells us it’s better to take action today than regret inaction tomorrow. Please keep in mind that this all assumes that you have taken dramatic action to merchandise/stage your property appropriately and you have a savvy real estate agent marketing like a whirlwind.
Any questions, feel free to give me a call, Ken Brand, 832-797-1779 or shoot me an email or leave me a comment.
