Simple. The market is hot for only the best listings. While the market shifts a little here and there with time, there are some simple truths that always remain. One is that the best houses will always sell faster regardless of the market. During the bad market, I always said that if there are only two houses for sale and only one buyer, the buyer will pick the best one. Now that the market is better, maybe I should say if there are only 200 houses in a price range, the 100 buyers out there will pick the top 100?
My friend Shaun and I were talking last week. We were wondering how many buyers there really are right now clamouring for the same houses. He recently blogged about this too, but from a standpoint of accurate list pricing. That is also one of those truths that is constant regardless of the market….the houses that are priced accurately will also always be the ones to sell more quickly and for closer to the asking price.
So, what does this mean to a buyer? Well, it means not all new listings will have the perceived competition from other buyers. Buyers today are so afraid of losing a house in multiple offers that many default to offering list price. That is great if the house merits that, but not all of them do. Like, you would have felt pretty stupid rushing in with a full price offer for one of those 39 houses that were just reduced, right? Those houses obviously were not worth bending over backwards in hopes that the seller would accept your offer.
So how can you tell the difference between a new listing that you better rush to see and one that will end up being reduced down the road? I look at several factors: Price, condition, neighborhood, school district, etc. If all those are good, I look for things that most buyers frown upon, like a steep driveway, odd shaped lot, unlevel lot, laundry room location….just several different things that my experience as a Buyer’s Agent tells me will make the house harder to love. It is part gut and part science. The house that is priced right, is in good condition, in a nice neighborhood and easy to say “YES” to is the one you better move on quickly. The rest? Don’t worry about those. I think there are a lot of buyers out there right now who are paying too much for a house because there is a perception that all houses are selling fast. Not true!
One thought on “If the market is so hot, why did 39 houses get reduced today?”
Hi John, I have been reading your blog of late because I am considering a move to Lexington after I sell my home in Spring Lake, NJ. I am under a contingency contract so the buyer needs to close before I can really do anything. However, I would like to visit the town soon and locate possible homes that might fit my needs. I am 60, single, and would pay cash for the entire purchase. My range is 100k-175k. You seem to have a great feel for people and the market, that’s why I would like you to represent me. My name is Bob Wade 732 449 2060. Hope we can talk soon and I look forward to being in Lexington in the next week or so. Thanks if you can help me, Bob On May 22, 2013, at 11:49 AM, Lexington Ky Real Estate Blog-Heavy on the Real Part wrote: