Back on December 3rd I wrote about the pros and cons of listing a home during the holidays. I said it was a good time to list a home, but what do the statistics show?
There were 2,556 homes newly listed on REcolorado (Denver’s MLS) during the month of December. As of this past Sunday, Jan. 24th, 1,781 of them, or 70%, had gone under contract.
This is not much different from a year ago. During December 2014, 2,533 homes were listed on REcolorado, and by Jan. 24, 2015, 1,690, or 67% of them, had gone under contract. Another 1,482 homes which were already listed prior to December also went under contract during this time-frame, for a total of 3,172 homes. That computes to 49.7% of the 6,382 homes that were active during December, according to REcolorado.
How does that compare with what many think of as real estate’s “high season” — summertime?
In July 2015, 8,153 homes were listed on REcolorado, and by Aug. 24th, 5,282 of them, or 65%, had gone under contract. Another 1,247 homes which were already listed prior to July 2015 went under contract during that time-frame, for a total of 6,529 homes. That computes to 63.8% of the 10,229 total listings during July 2015.
So, percentage-wise, mid-winter is as strong a selling season as summer. The dynamic of supply and demand is at work year-round, and is even stronger with winter’s reduced inventory of homes for sale.
Here's a screen shot from a report issued by the Denver Metro Association of Realtors showing dramatically fewer listings to choose from, yet dramatically more sales. It was issued just after I sent this article to the newspapers:
I experienced the effects of this market situation with the Arvada listing which I featured in last Thursday’s ad. It went active on the MLS Wednesday morning, with showings beginning on Thursday. We received three contracts, sight-unseen, on Wednesday, all of them $15-20,000 above listing price. By Saturday we had 125 agent showings and 16 additional offers — all of them well above listing price and 11 of them with escalation clauses offering to beat any competing offer by up to $3,000. Following Saturday afternoon’s open house — attended by over 50 people — the seller chose one of the 19 buyers and went under contract for $40,000 over listing price.
Because of the competing offers, the seller was not only able to get the best price but was able to negotiate their preferred closing date, a free post-closing occupancy period of two full weeks, and waiver of both inspection and appraisal conditions. Now, that is how to utilize a seller’s market to benefit a seller!
In December, I was on the other side of this seller’s market, representing a buyer competing with seven other buyers for a home in Westminster. We were able to snare that property for our client only by offering up to two months’ post-closing occupancy at $32/day, totally free moving using our company moving truck, free labor, free gas, and free moving boxes, plus an escalation clause offering to match any competing offer “so the seller can take advantage of the above benefits.” We also waived inspection and appraisal. And, of course, we submitted a friendly letter to the sellers from my clients which included their wedding picture and the fact that the wife is pregnant with their first child. The seller was so impressed with our additional provisions that they actually countered at $3,000 less than the highest competing offer! Now, that is how a buyer can win in a seller’s market!
In conclusion, if you’re a seller thinking you need to wait until spring when everyone else will be putting their home on the market, perhaps you should think again and put your home on the market now. Remember those 19 offers I got on the Arvada listing last week? It’s a sure bet that 18 unsuccessful buyers are still out there looking for a home. But don’t make the mistake of going for-sale-by-owner. Do you really think you’re prepared to handle the scheduling of 100 agent showings and evaluating and negotiating a dozen or more competing contracts? Remember: When it’s this “easy” to sell your home, that’s when you really need an experienced listing agent on your side.
Published Jan. 28, 2016, in the YourHub section of the Denver Post and in four Jefferson County weekly newspapers