Sold comps now matter less

Time was when I would tell clients that the sold comps were what we had to consider, as that is what we used to justify the asking price. Times have changed. Significantly.

Now when pricing a home, we have to consider the sold comparable homes as a measure of the asking price, but we have to consider the active competition even more. In the boom market, there were very few homes from which to choose. That is no longer the case. More and more when pricing home, we have to look at how many homes (because there are now more than one or two in each neighborhood) are actively on the market, for how long (because they tend to stay on longer than five or six days).

After analyzing those aspects and running the house through several different price analyses, then we decide whether and by how much, we need to undercut the competition.  The market has changed. We will have a better feel for how much it has changed in March/April.

Take heed - no longer can a home’s asking price be realistically set by the metric of “I have to clear X dollars.”  Realistic expectations are welcomed.

*Disclaimer: all real estate markets are decidedly local. What I write about the Charlottesville area real estate market may or may not be applicable to the Phoenix, Denver or D.C. real estate market.

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February 1, 2007 | Filed Under Albemarle, Buyers, Charlottesville, General Real Estate, Market statistics, Sellers 

Comments

4 Responses to “Sold comps now matter less”

  1. Doug Quance on February 1st, 2007 7:32 pm

    You’ve hit the nail on the head, Jim.

    Comps only tell us what a property may appraise for… not what it will sell for.

  2. EasyHUD - Foreclosure Resources for Everybody » Blog Archive » 50% of US Consumers Believe Housing Price Collapse Possible … and more news! on February 2nd, 2007 10:50 am

    [...] Sold comps now matter less (realcentralva.com) [...]

  3. Charlottesville Area Market Update - June 2008 | Real Central VA on June 9th, 2008 6:01 am

    [...] times. I didn’t know how long we’ve been in this cycle until I referred to this story - Sold Comps now matter less - from February 2007; and was a bit shocked that it had been so long since I had written [...]

  4. A Sign of the Times - Short Sale in Old Trail | Real Central VA on August 25th, 2008 2:28 pm

    [...] there are no sold comps (per the MLS) by which to draw comparisons on price. (Have I mentioned that sold comps matter less?) Take a look at the active two bedroom townhomes in Crozet - there are no under contract ones [...]