I have always told my clients that in good markets or bad, if a house is over-priced, it will languish. The SELLER has to come down first, and when the price hits the sweet spot (i.e. offers value), buyers come out, and the house typically sells over 90% of LAST list price - give or take.
In good markets or bad, if houses are correctly priced, they can get multiple offers and sell at, or even over, asking price.
This has been borne out by data for years upon end. Now, there are more blips and exceptions to this rule, which makes the real estate market even more tricky for those who don't track it daily.
For example, in Westport in 2012 (as of early October 2012): even in this market, plenty of houses sold at, or above asking price. Some premiums were substantial:
130 Old Road, listed at $559,000 and sold for $620,000
5 Chapel Hill, listed at $459,000 and sold for $603,000 - over 31 % premium over asking price
34 Little Fox Lane, listed at $727,500? It sold for $861,000 - over 18 % premium
1 Brook Lane, listed for 784,900 and sold for $838,000
5D Gorham, listed at $1,325,900 and sold for $1,350,000
4 Wheeler Gate, listed at $1,675,000 and sold for $1,685,000
5 Pumpkin Hill, listed for $2,995,000 and sold for $3,068,000
But at the same time, look at these low-balls - they used to be so rare!
42 Bayberry Lane, listed for $825,000 and sold for $680,000 - almost an 18% discount
6 River Lane, listed for $1,050,000 and sold for $840,000 - a 20% discount
3 Crestwood, listed for $1,400,000 and sold for $1,200,000 - a 15% discount
7 Indian Point Lane, listed for $1,499,000 and sold for $1,200,000 - a 20% discount
153 Easton Road, listed for $1,500,000 and sold for 800,000 - a whopping 47% discount!!
3 Meeker Road, listed for $1,595,000 and sold for $1,350,000 - a 15% discount
24 Narrow Rocks, listed for $1,599,000 and sold for $1,250,000 - a 22% discount
22 Wakeman, listed for $1,600,000 and sold for $1,100,000 - a 32% discount
32 Bermuda Road, listed for $2,350,000 and sold for $2,000,000 - a 15% discount
SO IN THE SAME PRICE POINTS, you have MUCH bigger swings in prices, from a 47% discount off latest list price to a 31% premium over list price.
In the old days, over-priced houses would sit on the market until sellers lowered the price. Buyers wouldn't bite. Sellers wouldn't entertain an offer with a 20% discount - they would be insulted. Many still are! But look at these 2012 sales which closed well below the last asking price...and we are still only in October!
It means that in this market, each seller has a different tolerance for those "low-balls", and you need an agent who knows the market and recognizes the difference! Someone who knows when to throw that low ball, and when to pay full price. Because you have BOTH scenarios going on ! Interesting times.
My data was pulled directly from the Greater Fairfield County Multiple Listing Service. See the link for the listings: http://matrix.ct-mls.com/DE.asp?ID=115331787
