Lon Welsh, Your Castle Real Estate
We just finished an analysis of which homes are most likely to sell in the Denver real estate market. We found that overall, 42% of the homes listed between January and September 2009 went on to sell. We didn’t look at more recent listings since it takes many months for some homes to attract a buyer, and then 30-60 days to go on to close.
The odds of your home selling are highly dependent on a few factors:
- REO (real estate owned by banks) was the most promising category. On average, 90% of REO listings were sold (the other 10% were withdrawn from the market or the listings expired).
- Denver short sale (S/S) listings were the least likely to sell; on average 32% of these listings sold.
- Regular, non-distress sellers were in the middle; 37% of these homes sold.
The other interesting finding was that the price of the home also has a significant impact on the odds it will sell. In the Denver market, the least expensive 10% of the homes sell for $85,000 or less. Regular sellers in this price range enjoyed a 78% success rate. 44% of the S/S sold (see chart for details). On the other hand, the most expensive 10% of the homes sold for over $460,000. This is also the segment where most buyers will need a jumbo loan. Only 16% of the regular listings sold, and 14% of the short sales.
We did this analysis by looking at the number homes that sold relative to the number that sold plus the number of expired and withdrawn listings. We ignored the active listings that were initially brought to market in January – September 2009. In reality, if your home has been on the market for around a year, the odds are not too high that it will ever sell (at your current price). So if you were to include these stale, active listings, the success ratios would go down somewhat.
If you are interested in selling your home, be sure to take the time to really understand the likely selling price. Don’t “test the market” at a higher price. List the home at the proper price on day one. Be sure it shows very well. And make it available, so Realtors can easily bring buyers to see it. It’s a great market for sellers under $250,000. The market from $250,000 – $450,000 is balanced. Homes in good condition that are priced correctly are selling in a reasonable time. Above $450,000, it’s a strong buyers market.