In NW Seattle, homes going under contract continue to keep up with new homes coming on the market. This is not our typical August market. Buyer activity usually falls a bit over the summer months, which then allows inventory levels start to climb. However, Homes are taking a bit longer to sell than earlier in the year. Steve and Sandra review the numbers.
This week we also talk about list price. Pricing is pretty challenging in any market, because it is hard to find perfect comparable homes. But in a Sellers market, a lot of Sellers and Brokers don’t think that there is any downside to purposely pricing low with the idea that multiple offers will drive up the purchase price.
However, for the past 12 weeks only 55% of homes sold above asking. So your odds are just slightly better than 50/50 that you will get multiple offers. That seems a bit risky.
Pricing is challenging and there is a risk of leaving money on the table if you under price. Our philosophy is to price at market, for example if we think a home will appraise to $850K, that’s where we price it – we don’t list at $800 or $825K to try and get multiple offers.
Video Transcript:
Steve Hill:
It is week 76 of our Monday Market Update and we’re entering the fourth week of August in Northwest Seattle. Homes going under contract continue to keep up with new homes coming on the market. This is not our typical August market. Buyer activity usually falls a bit over the summer months, which then allows inventory levels to start to climb. However, homes are taking a bit longer to sell than earlier in the year. We had 41 homes go pending last week, but only 54% went under contract in nine days or less. For the previous three weeks, the average was 79% of homes went under contract in nine days or less so this is a big drop. It will be interesting to see if that trend continues or if this week is just a blip.
Sandra Brenner:
Yeah, it will be really interesting to see if that trend continues. But one of the things that I wanted to talk about this week was list prices.
So pricing is super challenging in any market because it’s really hard to find that perfect comparable home. But in a Seller’s market, a lot of Sellers and brokers don’t think that there’s any downside to purposely pricing low with the idea that multiple offers will drive up the purchase price. However, for the past 12 weeks, only 55% of homes sold above asking so the odds are just slightly better than 50-50 that you will actually get multiple offers. I don’t know about you, but to me, that seems pretty risky.
So I was chatting with a broker last week, asking her about activity on her listing. I wanted to know how many offers she had and what it was going to close for. At her current list price, I had expected that she would get multiple offers. It was probably $25,000 under where I would have priced it so she was super surprised that they only received one offer. With that offer though, they did receive an escalator that would have gone $35,000 over their asking price. However, because they only received one offer, they couldn’t actually use the escalation. So as you can see, pricing is challenging and yes, there is a risk of leaving money on the table if you under price.
So our philosophy is to price at market. For example, if we think a home will appraise to $850,000, that’s where we price it. We don’t purposely list low at 800 or eight and a quarter to try and get multiple offers.
That’s it on pricing this week. We hope everybody has an amazing week. Don’t forget to like this video and please subscribe to our channel.
Steve Hill:
Thank you, everybody. Have a great week.
