By now, we all know that the old real estate saw of “Location, Location, Location” has been replaced by “Price, Price, Price”. The numbers—sales, price reductions, days on market—tell the story. And while we’ve seen down real estate markets before, this is the first one we’ve seen in the real estate information age.
For the first time, in addition to MLS data provided by Realtors®, buyers and sellers are accessing a raft of information on web sites like Trulia.com, Zillow.com, Realtor.com and even local online news outlets. In fact, a recent Trulia.com report indicates that the Jacksonville market, where I work, has the dubious distinction of leading the nation in percent of listings with price reductions. According to Trulia, 36% of homes for sale in Jacksonville, FL in January saw an average price reduction of around 13%.
What does it all mean? Now, more than ever, job one for Realtors® is to help clients parse data into meaningful, actionable knowledge. Ultimately, it will lead to a home that is priced right and should sell quickly.
It’s a simple concept, really. Get to your lowest possible price (or close to it) right out of the gate. It’s like no haggle pricing at the car dealership. And it’s a strategy I saw work time and again in my previous life in marketing and advertising.
Buyers love it because they can feel confident that they’re actually getting a fair price. Seeing comparable pricing in the market, as well as sales vs. list price, should convince reasonable buyers that they’ve found the bottom.
For sellers, it means a quicker sale with less drama. And while they may not have gotten exactly the price they were hoping for, they can probably make up the difference with a great deal on the next house they buy.
For Realtors®, getting to the right price really means getting hyper-local and digging into the data in your own backyard. While I live and work in the Jacksonville area, where that Trulia report pegs an average price reduction of 13%, my primary market of Ponte Vedra, FL is actually trending slightly lower, with an average price reduction of about 12%. It’s a small difference, but I’m sure I’d see some wide swings simply by drilling down to a neighborhood level. Hyper-local can make a big difference…
It’s just another example why buyers/sellers need a knowledgeable Realtor® who can separate fact from fiction in the new real estate numbers game.