Lew Sichelman
Thirty days isn’t a long period of time. But when a house sits on the market for that long without so much as a nibble, the listing becomes what’s known in the trade as “stale.”
And right now, according to Redfin, more houses have been on the market for 30 days or more than any other time in recent memory, with nearly 2 in every 3 listings in June at least meeting the 30-day threshold.
The share of languishing listings has been accelerating thanks to a bump in more houses being offered for sale at the same time that demand has waned in the face of stubbornly high mortgage rates.
“Less-desirable listings are sitting on the market, causing unsold inventory to pile up,” Redfin reports.
Despite this trend, the brokerage firm notes that properties in desirable neighborhoods that are move-in ready are still selling quickly. Listings not meeting these criteria, though, are starting to stack up. Indeed, over 2 in every 5 houses for sale in June had been listed for 60 or more days and still saw no contract.
What Could Be Wrong?
When a listing is at least 30 days old, it tells buyers that the house is a dud, that it isn’t even worth looking at because something is wrong. And a lot could be wrong.
Perhaps the marketing is lacking, with cellphone photographs and less-than-sparkling descriptions. Maybe the offering comes with a slew of contingencies that indicate the seller is too picky. Or perhaps the house can be shown only at specific times, limiting would-be buyers’ ability to gain access.
Any one of these could be factors in turning away buyers. But the No. 1 reason a house pines away for 30 days or longer is price – as in overpriced. It is a sure sign that the seller really doesn’t want to sell.
“You can price your house to sell or not,” wrote Doug Campbell, a Tampa-area agent, on the ActiveRain real estate site. He gave a big shoutout to sellers who overvalue their properties, thereby “making it much easier for buyers to recognize that properly priced houses really are good deals.”
Some agents believe in a two-week window. If the house doesn’t sell within 14 days, a price adjustment is in order. But most agree that 30 is the magic number. “I talk with my sellers about the ‘30-day sale’ and that we need to price to sell in 30 days to avoid getting stale,” wrote agent and author Jennifer Allan-Hagedorn on ActiveRain.
Dawn Brenengen of Trailwood Realty in Raleigh, North Carolina, comments on an ActiveRain post by Coral Gundlach with an anecdote of how she once had to turn down her best friend who wanted to list her place for $30,000 more than it was worth.
“She was hoping that some sucker would just walk by and decide they couldn’t live without buying it,” she wrote.
Some blame listing agents as well as sellers for properties going stale. Too many agents are enabling this behavior, they grouse, labeling the conduct as wasteful of both the time and energy of buyers and their agents.
What’s to Be Done?
The moral to all this is to latch onto a top-flight professional who will know which way the pricing winds are blowing. They’ll look at how places similar to yours have fared of late to determine whether prices are rising, falling or remaining stagnant. They’ll look to see how many days these “comparables” have been on the market, and they’ll do a complete market analysis to determine what your place should sell for.
Of course, setting a listing price is ultimately the seller’s call. They can listen to their buddy Joe who magically pulls a price out of his left ear, or they can decide on their own to go high in hopes that one buyer who is flush with cash will find their place so appealing that he just can’t resist it, no matter how overpriced it really is.
But true professional real estate agents have years of experience and take pride in pricing properties correctly. When they determine a listing price, they price houses to sell, not to sit for weeks to be ignored by agents and their buyers alike.
“The challenge for me is getting the sellers to listen to the facts and figures,” wrote Scott Cowan of RE/MAX in Olympia, Washington, as a comment to Allan-Hagedorn’s post. “Too many sellers have a[n] inflated opinion of their property vs. the competition on the market.”
There’s an adage in the real estate business that goes “list high, list long,” meaning that if you set a higher price, the listing will be on the market for longer than need be. But with the number of houses going up for sale rising, that doesn’t work anymore.
Rather, why not price your place right to begin with? Otherwise, your listing will just go stale until it expires, at which point you’ll either have to pull your house off the market altogether or re-list with another agent who will likely insist that the place be priced at what it should have been in the first place.
Lew Sichelman has been covering real estate for more than 50 years. He is a regular contributor to numerous shelter magazines and housing and housing-finance industry publications. Readers can contact him at lsichelman@aol.com.
