The One Number Every Home Seller Needs to Know
Dear Ali; We want to list our home to sell it, and we are interviewing real-estate agents. What number should we talk about first, listing price or commission?
A: In any listing pitch you're going to talk about both -- because they're intertwined. If your price is "lower" relative to the level of the market, your home will be easier to sell, so the real estate agent can work for a smaller commission.
However, the overall sales climate is still slow. The National Association of Realtors' latest statistic on existing home sales shows that while the national sales level was up two percent from April to May, it's still down about four percent from this time last year. We're still moving at a pace of under five million home sales annually, versus more than six million during the boom year of 2006.
So the most important number for you to talk about in any listing pitch is actually "days on market." This is a statistic put together by a local group -- sometimes it's your local board of Realtors, sometimes it's the local Multiple Listing Service -- which talks about how long, on average, it takes a home to sell in your area.
Days on market will give you a pretty good idea of how long a slog it's going to be. If you have a unique property that only appeals to a small number of buyers -- say you have a great pool-- you can look at that number and pretty much double it.
The trend of days on market will also help tell you tell -- in my mind, even more than price trends -- whether your market is picking up or slowing down. In the Manhattan luxury market, for example, Jonathan Miller of Miller Samuel reports in the Prudential Douglas Elliman Manhattan Market Overview that days on market expanded to 182 last quarter from 153 the previous quarter. If you wanted to put your chi-chi apartment on the market now, a potential listing agent should be warning that it could take at least six months to sell and have ideas about how to market your home for that long haul.
Good luck!
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