Mis-Pricing a Home: One Agent's View – It Costs $95,235 per Transaction on a $907,000 Home (?)
October 28, 2013 | | | Celebrity Real Estate, Dallas Real Estate News, Economy, Emerging Real Estate Markets, House Candy, Real Estate, Real Estate Market News, Realtor News
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A refigured Real Estate Fun Fact from Kyle Rovinsky:
In 75230 zip (North Dallas) for all transactions 4 bedroom+ on lots .3 acre+, (total of 229 transactions), houses on the market 30 days or less sold for an average of 98% sale price to list price. Houses on the market 45 days or longer sold for an average of 87.5% sale price to list price.
The average sale price for these 229 homes was $907,000. 10.5% costs an average of $95,235 per transaction for mispricing a home.
Ouch. Thoughts? PS: Details on this southern stunner forthcoming.
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For the under $1M transactions in the same area with the same factors, 140 homes, average sale price of $589,850. Houses on market 45 days or longer sold for an average of 88.8% sale price to list price. Houses on market 30 days or less sold for an average of 98% sale price to list price. 9.2% means a cost of $54k for overpricing your house.
For the under $1M transactions in the same area with the same factors, 140 homes, average sale price of $589,850. Houses on market 45 days or longer sold for an average of 88.8% sale price to list price. Houses on market 30 days or less sold for an average of 98% sale price to list price. 9.2% means a cost of $54k for overpricing your house.
That makes no sense at all. The actual selling price can be fairly viewed as representing the actual market value. That some realtor/owner overpriced it by $100K doesn't mean that it "cost" $100K to be sold at its market value. If you price a $600K house at $6M and get laughed at for two months before selling it for $600K, it hasn't "cost" you $5.4M; it's just cost you the delay in pricing/selling for its actual value. That is, the "cost" you're talking about isn't real money to anyone, it's just the difference between reality and delusion.
That makes no sense at all. The actual selling price can be fairly viewed as representing the actual market value. That some realtor/owner overpriced it by $100K doesn't mean that it "cost" $100K to be sold at its market value. If you price a $600K house at $6M and get laughed at for two months before selling it for $600K, it hasn't "cost" you $5.4M; it's just cost you the delay in pricing/selling for its actual value. That is, the "cost" you're talking about isn't real money to anyone, it's just the difference between reality and delusion.
Your sample is to large and does not include enough detail or adjustments for differences. In 75230 in the last 12 months using your criteria greater than 4 bedrooms and greater than 0.3.acres I found the following: 167 sales with years built 1940 to 2013, sale prices of $264,9000 to $3,400,000, lot sizes from 0.3 acres to 2.27 acres,waterfront homes, luxury homes and homes in need of repairs These differences are too vast to produce a real result. Narrow down the sample to several groups of like homes and the results will have more credibility. The old saying garbage in garbage out applies here.
Your sample is to large and does not include enough detail or adjustments for differences. In 75230 in the last 12 months using your criteria greater than 4 bedrooms and greater than 0.3.acres I found the following: 167 sales with years built 1940 to 2013, sale prices of $264,9000 to $3,400,000, lot sizes from 0.3 acres to 2.27 acres,waterfront homes, luxury homes and homes in need of repairs These differences are too vast to produce a real result. Narrow down the sample to several groups of like homes and the results will have more credibility. The old saying garbage in garbage out applies here.