This is a most excellent question, and one about which I’ve been wondering myself. In Greensboro and surrounding areas, the selling price to asking price percentage has historically been in the 95% to 97% range. For buyers coming from other parts of the country, paying that close to the asking price has sometimes been really hard to swallow. Like, “50 peanut butter covered saltine crackers with no milk to wash it down” hard to swallow.
But them’s the figures. Or at least they were the figures until the current..unpleasantness…started.
So, surely buyers are getting to knock off 10, 15, 20 percent off prices and getting deals. Right?
Not so fast, Grasshopper. Let’s look at some figures for the year and half or so:
In Greensboro (and I’ll be looking just at Greensboro for these purposes, to keep my brain from breaking trying to pull data from the multi-county area that comprises the Triad MLS) the averages for CLOSED properties are:
June 1, 2008 – November 30, 2008* (the most recent 6 months)
- Average List Price: $177,310
- Average Sales Price: $171,527
- Sales/List Percentage: 96.7%
June 30, 2007 – May 31, 2008 (the 12 months prior to that)
- Average List Price: $179,819
- Average Sales Price: $174,969
- Sales/List Percentage: 97.3%
First we can see that the List/Sales price percentage is nearly the same. Second we can see that list prices in the most recent 6 month period are lower than in the preview 12 month period.
So, what gives? What’s with all the desperation and angst in the market we keep hearing about?
Well, it’s out there. Just not necessarily in the Greensboro city limits. If you read my earlier post you know that in the whole of Guilford County, of which Greensboro is the largest city and county seat, average prices have fallen more dramatically. But even with that the average sales/list price came in at about 95.5%
One reason for this is that there is another variable and that’s the original list price of houses. As homes have remained on the market and inventory has increased, sellers have reduced the asking price of their home. In the aforementioned time frames we see the following:
June 1, 2008 – November 30, 2008 (the most recent 6 months)
- Average original list price: $191,138
- Average final list price: $177,310
June 30, 2007 – May 31, 2008 (the 12 months prior to that)
- Average original list price: $186,437
- Average final list price: $179,819
Thus, we can see that sellers have – on average – already reduced their asking price by about 7% recently before hitting the number that produces a sale whereas a year or so ago, all other things being equal, that owner would have reduced by only about 4%.
All this having been written, it is clear that while some deals are being made with great price concessions being made by sellers, it’s still not fire sale time. Not in Greensboro, anyway. Other parts of the country are experiencing very different trends.
Just know that low-balling an offer may get you a deal. Or it may get you an irritated seller who feels they aren’t interested in being reamed and won’t deal with you. One never knows.
Each transaction is unique to the individuals involved. There is no absolute in the purchase or sale of a home. It’s exciting and traumatic and scary and exhausting for those on both sides of the table. And keep in mind that there are humans involved. Some in not so great a place.
Be nice. And if you can’t be nice, be humane.
* Again, all data is pulled, compiled and possibly jacked up by me, but I’ve tried to keep it as clean as possible and is all from Triad MLS (Multiple Listing Service).
