Oh, the Games Real Estate Agents Must Play The Real Estate industry commonly utilizes a practice in tracking how efficient their agents are in obtaining the most amount of money for their Seller s listings in the shortest period of time and they do this by looking at the % Sold Price to List Price and the D.O.M. (Days On Market) which is the amount of time it takes for a home to go into Escrow. Even the President of the Honolulu Board of Realtors was recently sited in the Honolulu Star Advertiser how marvelously pricing was stabilizing because the % Sold Price to List Price was rising. 1
Year to Date, the % Sold Price of Listing Price is an Average 95%. In 2009 it was 92%. In 2008 it was 95%. We all know that Sellers want the most amount of money for their homes in the least amount of time. This is in fact the ultimate goal that will provide the Seller with the most amount money from their home sale. Below is an example of a C.M.A. (Comparative Market Analysis) header: I want to ask you: Do You Want to Hear What Your Home is Worth? Or Do You Want the Agent to tell You What You Want to Hear? THIS IS IMPORTANT BECAUSE: 73% OF ALL SINGLE FAMILY HOME SALES YEAR TO DATE ARE SOLD AT LESS THAN 100% OF FULL LISTING PRICE AND THOSE THAT ARE RECORDED SOLD AT FULL PRICE OR MORE THE AVERAGE IS 43% of total listings. Wait! This Gets Better! Of the 43% of all Sold Single Family Homes year to date AND Sold WITHOUT RE-LISTING OR PRICE REDUCTIONS THE AVERAGE IS 27% 2
Oahu SFH September % Sold At Full Price Or More 80% 70% 60% % Sold AT Full List Price Or More 50% 40% 30% 20% 10% % Sold AT Full List Price Or More WITHOUT RE-LISTING OR PRICE REDUCTION 0% Jan. Feb. March April May June July Aug. Sept. Once again I must emphasize, do not believe what you read in the Honolulu Star Bulletin concerning Real Estate Sales and be suspect what you hear from other sources who are quoted by the Newspaper. Do you your own fact checking or ask me. Here is my quote: Oh Yea, Real Estate is on the Re-Bound because those % Sold Prices to Listing Prices are rising. Get real. You Might Ask: How Does this Happen? Let s look at a typical Single Family Home C.M.A. (Comparative Market Analysis) which will tell us how an area sold recently. This C.M.A. will show us property address, Tax Map Key (T.M.K.), number of bedrooms, baths, ½ baths, square footage interior, lot size, what the property was Listed For Sale at, what the property Sold for, D.O.M. (Days On Market) (How long it took to go into Escrow) and what the % Sold Price is to the Listing Price. As an Example, here is Kailua September 2010: (I have removed addresses) 3
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Here is where the fun begins. There are 33 total Recorded Sales. Of the 33 there are 14 recorded Sold at FULL PRICE OR MORE. Total D.O.M. for all 33 sales: 63 Days Of the 14 that were recorded Sold at FULL PRICE OR MORE, 5 WERE SOLD AT FULL PRICE OR MORE WITHOUT RE-LISTINGS OR PRICE REDUCTIONS OR ONLY: 15% The D.O.M. for these homes: 9 Days! 6
Kailua SFH September % ALL Homes Sold At Full Price Or More 70% 60% 50% % Sold AT Full List Price Or More 40% 30% 20% 10% 0% Jan. Feb. March April May June July Aug. Sept. % Sold AT Full List Price Or More WITHOUT RE-LISTING OR PRICE REDUCTION Here are some of the details that contributed to the above conclusion: The above is how a Full Price Listing Sold when there are No Re-Listings or Price-Reductions. The M.L.S. provides tracking for any and all changes to each M.L.S. associated with a particular property address. 7
The above home first listed for $999,000 and ultimately sold for $850,000 and it took 64 days for the home to go into Escrow although it was recorded Sold at Full Price Or More. 8
The above home was first listed at $1,149,900 and sold for $997,500 and it took 145 days for the home to go into Escrow although it was recorded Sold at Full Price Or More. You might ask: What is so significant about the D.O.M. 1) The longer a home in on the Market, regardless if you drop the price, re-list it, buyers will predominantly Low Ball on a home that has been on the Market too long. 2) While your home is on the Market too long, the Market is still going down and very soon your For Sale price is even higher than it should be when you first listed it. This home was listed at $1,999,999 and sold for $1,140,000 and it took 175 days to go into Escrow although it was recorded Sold at Full Price Or More. 9
The above home sold for less than Full Price although it was recorded as sold at Full Price because it was RE-LISTED and the original listing was at a higher price. (I have cut off most of the M.L.S. # and left just enough to show you there were two M.L.S. # s for this home and address.) I want to thank everyone who has written into me and shared their wonderful comments about my articles. I do not do this for Fun. I do this because I enjoy Real Estate Sales and I strive to be honest and ethical in all my dealings with my clients and the Public. I also do this to show you that pricing your home is of the utmost importance and I do know how to do this. If you need a Realtor who can sell your home (for real!) at Full Price, WITHOUT PRICE REDUCTIONS, WITHOUT RE-LISTINGS, WITHOUT DRIVING UP YOUR DAYS ON MARKET, WITH OUT THE GAMES please call me. I also track data on my competitors. I wish you much Aloha, Mike Gallagher, Broker in Charge, Abe Lee Realty 808-384-9015 mikeg@hawaii.rr.com Ethics Complaints Review Member, Honolulu Board of Realtors www.hawaiirealestatestatistics.com or www.aroundhawaii.com 10