A Frequently Asked Question by buyers is, "Does Average Days on Market mean that I can get a better price?Â To answer this question let's take a quick look at some facts, because I prefer facts over opinions, because let's face it, opinions are only worth a hill of beans. There are numerous examples I could use to prove my point but will start with using the MLS Area 0500, a section within Central San Antonio, Texas.Â Lets look at a few numbers, which probably means nothing right now.Â
look at the area I cropped and color highlighted in lime green.Â There
is a central tendency cluster of homes priced between $150,000 and
$249,999 which also happens to be our mode average for home Sales Prices in San Antonio, Texas homes sales, (coincidentally).
you might think the higher the Sales Price, the longer it will take to
sell.Â But the Sales Price and the Average Days on Market do not necessarily correlate.Â
If you look to the last columng, you'll see additional data that shows
181 Average Days on Market for homes that sold under $100,000, and only
97 days for homes that sold between $400,000 and $449,000.Â Referring
back to the larger worksheet above, and you further drill down, you will
see that homes that sold from $550,000 to $559,000 sold even faster
than the 17 homes priced between $450,000 and $549,000.Â That's opposite
from popular belief.
Here are a few graphs that really show you what's going on in this scenario. The price ranges that stand out are:Â $400,000 - $449,000, $150,00 - $199,000, $550,000 - $599,000, and $1,000,000 to $1,999,999.
So what does this mean? There are many factors used to determine a sales price.Â I often say that the real value is what the buyer is willing and able to pay, but it really is more complicated than that.
There is a real estate term known as "situs" which basically means that there are geographical preferences or popular places to live which may or may not have any financial basis.Â Examples include proximity to down town, cultural arts districts, historicical areas, or some other non-financial determing factor.Â
So what's so special about MLS area 0500?Â Nothing really other than I used it to make a point about the relationship of Sales Price to Average Days on Market.Â Although it does have a geographic significance in that the homes are mostly custom, it is centrally located, and has two incorporated cities within its boundaries known as Castle Hills, a very prestigious community, as well as another popular city with acreage home sites known as Shavano, which also explains the wide disparity between prices.
what about homes compared against homes within a community that have
the same floor plan and features? Shouldn't the one that sat on the
market longer have price reductions and lower than the newer listing?
I'll answer a question with a question.Â Would you drop your sales
price because it has been on the market for a few months?Â Personally, I
might do it but certainly not just to make room for my competition. I'd
drop if I had proof that the sales price was not matched properly with
the home value or there was some other looming issue like foreclosure,
etc.Â For example, if 23 people have toured my home and yet no offer,
well it makes sense to drop. What if 3 other houses that were similar
were in better condition, had more upgrades, etc. then either I should
put some money into upgrades to match or lower the price to match. But
that has nothing to do with Average Days on Market if those actions are
So Mr. Buyer, please do take this into consideration when looking at homes. Do not make rash judgments based strictly on the one or two homes that you saw sitting on the market thinking they should be ready to drop a sales price.
And Mrs. Seller, please do remember that condition and situs make a huge impact on your Sales Price and Days on Market.
These are all things Cathy Bureau can help you with when you are ready to buy or sell a home in San Antonio, Texas. I'm here to help you make smart decisions.
Thanks for reading my blog!Â
If you are thinking about buying, selling or know somebody who is, I
would greatly appreciate allowing me the honor of helping you with your
needs.Â You can call, email, or text me - below.
CATHY BUREAU Broker/Owner
MBA, REALTOR, GREEN, SFR, ECOBROKER
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