This week our listings saw an average of 2.2 showings each. Traffic is steady and buyers are willing and able. So why hasn’t the market fully recovered yet?
My short answer is that these things take time! As an active real estate professional, I am seeing plenty of buyers are ready to get back in the game, but seller confidence is gaining faster than that of those buyers. There is still a wide discrepancy between what buyers are willing to pay and what many sellers are asking.
Consider that last month in Mecklenburg County, the average sales price was $241,000. The average listing price for those sales was $254,500 which means that right now homes are selling for about 95% of asking price.
However, if you look at ALL homes actively on the market right now, you’ll find the average listing price to be $322,300. If the average home sale price is $241,000 and homes are selling at 5% below asking price, then the rest of the market is way off the mark? About 25% off to be sure.
Now, it is true that the market for high end homes has been hit the worst in the current economy. So the inventory of unsold, high end homes does have a major effect on the average listing price for active listings. However, I can attest as a practicing agent that the majority of listings I show to prospective buyers are way overpriced based on comparable sales.
Often times, when I have a ready & willing buyer, we have to write several offers before finding those sellers that understand where the market is. Their home may have been worth $275,000 last year or the year before, but the market has shifted and that may not be the right price today.
Too many sellers are being influenced by the asking prices of their neighbors. Well, guess what? Their neighbors aren’t selling either.
The market is great right now! It is great for those buyers and sellers that recognize that the market HAS shifted. They are living in the present day and acheiving their dreams & goals with the current environment in mind. As for those who are evading reality and still pricing based on last year’s appraisal: its going to be a long road ahead.