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When I was first licensed in the 1990s, if a house didn’t sell for a period of time like 30 or 60 days, we would often reduce the price. Sometimes it was because we had too few showings, or because the showings we had didn’t yield any offers. On occasion, some home sellers would voice concern at a price change because no one had seen the house to give them price feedback. We’d have to explain that the feedback was the actual absence of showings. It wasn’t a truly data-driven process, however, because we had no means of measuring who saw the house either through their agent’s analog means (like seeing it in a broker’s binder) or advertised in publications and passed on it. We did have ample evidence that once a price was reduced, that the market responded.
It’s very different today. We have a number of digital means of measuring the interest -or lack of it- in a listing based on online metrics.
A few examples:
- Web traffic. We have access to dozens of websites that can inform us how many people have viewed the property, saved it, and if they viewed it multiple times. Zillow, Trulia, Realtor.com, our own website, and our client platforms all have some form of revealing the listing’s performance.
- Saved or Bookmarked listings. The same online assets can also tell us how many people added a listing to their favorite or saved list.
- Proprietary client portals stats. Often when a buyer client is working with an agent, that agent’s brokerage has an online client platform (ours is called RealScout) that tells us when a particular listing is opened or saved. This is not like raw web traffic. These are active clients who have a representation contract with an agency and have a login to a concierge type site that gives us rich data on a listing’s performance.
- Predictive analytics. This is crazy stuff. The program uses big data and is enhanced by AI, and can give us a far deeper dive into activity around a listing, and also tells us how many registered clients would likely save or match up with a listing by an algorithm fueled by web behavior. Simply put, it will tell me that a listing will garner 40 interested parties at $840,000 but 65 interested parties at $799,000. This is extremely data-driven and granular.
- Reverse prospecting. This is in the back office of the MLS and gives a listing agent a list of every instance where a fellow MLS member has sent this listing to a client.
Given that with virtual tours, floor plans, high resolution photos and even drone imaging every listing is virtually an open house online 24/7, we can therefore see if the listing’s performance is in sync with the online metrics, or if a price reduction is in order. Let’s take, for example, two similar listings with comparable characteristics; one is priced at $699,000, the other at $729,000. The 699 home has 500 unique views, 25 favorites, 20 showings the first two weeks, 35 reverse prospecting matches, and 2 offers. The 729 house has 350 unique views, 3 favorites, 8 showings the first 2 weeks, 15 reverse prospecting matches, and one offer below asking. It doesn’t take much to conclude that $729,000, even in this market, is too high.
If a home is under performing on the market, the seller should ask their agent to see the data on the home’s online metrics with consumers. The agent should be able to compare their performance with a comparable property, and even use the predictive model to see what would change with a price improvement. The math defines the path- armed with data, the agent and client should be able to know what the best move should be for pricing.
Upon occasion, we are asked by the seller if the perception of the public will change with a price drop. The concern is that the seller might appear desperate or something like that. Soon, I will write a piece on the things we overthink in this industry. That question will be prominent. In this market, those fears evaporate when the buyer competition heats up with a correctly priced listing.
Back in 2009, I was approached by Redfin to help them enter the Westchester real estate market as a referral partner. They did not have employee agents here, so referring clientele to other brokerages would be a win/win arrangement to start. I was eager for any new source of business, and took a closer look. Part of their vetting process was to survey my past clients, which was fine, but to also publish my client’s reviews online.
The conventional wisdom for people with a house they own who want to buy a new home has always been that they sell their current home before they made an offer on a new home because no seller wants a “contingent” deal on their sale. Also known as a Hubbard Clause or a sales contingency, it has always posed a risk for a seller because their sale depends on their buyer finding a buyer of their own. As a listing agent I’ve even had newer agents tell me that once my seller client agrees, their buyer will list their home for sale. Since it’s always been easier to buy than to sell, that seldom worked out.
In 1962, my older brother Paul, then just 4 years old, got gravely ill and was rushed to the hospital.
In 2015 I was asked to attend a hearing at the Town Hall of New Castle, NY to hear local residents speak on the expansion of a local children’s hospital, the Sunshine Home. I expected formalities. The expansion of a children’s hospital didn’t strike me as something anyone would oppose.
This past week I was contacted by the Sunshine administration and invited to take a tour of the nearly completed expansion. I was able to walk through with the director and got a tour of the magnificent job they did. In addition to increasing the bed count from about 50 to over 120, the resources available to the patients and their families are so extensive and first class that even my big mouth can hardly do it justice. The physical plant itself doesn’t feel like a hospital. It is a bright, airy, colorful lodge.
Willy Wonka than the expected utilitarian feel of a hospital. The utility is still there- it’s the presentation, however, that makes such a huge difference.
Buyers don’t need a buyer agent simply because they can open a lockbox and facilitate an offer. To do their job properly, buyer agents have an obligation to perform due diligence on the property they represent their buyers on, and sadly I’m not seeing that all too often. Buyers should expect that their agent will do verify a significant amount of information on behalf of their client:
This was clearly being sold by someone who was into do it yourself projects on the property. There was ductwork for central air that was not utilized. There were split units on many walls, part of an extensive system that was hard to piece together for us. A separate flue had been added to the heating system that was unused. There were drainage grates on one side of the house with electrical wires going down into the drain itself. The basement workshop appeared to be an active one, with pipes, hoses, and registers and systems that appeared to be connected to the split units. Outside, electric cables were run alongside the house, partially enclosed with downspouts.
The following is a list of good reasons for a buyer to waive their home inspection:
It’s February in New York, so Let’s Talk Swimming Pools
Swimming pools are an improvement, so they add value to a property. They can’t not add value presuming they are in working order, but there’s a but. The “but” is that while pools do add value to a property as an improvement and amenity, they also reduce the number of prospective buyers. There are two chief reasons for this.
The first reason is that, simply put, some folks aren’t pool people. It’s not their thing. They therefore aren’t interested in the added work, expense, and maintenance of a pool. And believe me, pools are all of those things. They represent an additional layer of duties, they come with extra costs, and they require maintenance from the homeowner, a pool company, or both. If you aren’t into having a pool, you will never want that additional layer of headaches like pool furniture, pumps, chemicals, safety precautions, and 100 other joys of ownership.
The second reason is safety. In 2007, when we were looking for a larger home with a 4th baby on the way, we did find one home that checked all the boxes in New Castle out by Millwood. It was an awesome colonial, it had wooded acreage, a woodburning fireplace, a 2 car garage and a full basement. But my kids’ mom vetoed it immediately when she saw that large inground pool in the back yard. Our son had just been diagnosed with autism, and there was no safety precaution in the world that would give us more peace of mind than the simple absence of a large drowning hazard in the back yard. We passed on it.
There is a lid for every pot, so I’m not down on pools despite their smaller “pool” (sorry) of buyers. I’ve never not been able to sell a home due it is having a pool. But over the years the question has been asked, and I think buyers know that the arguments against a pool may not justify a lower price, there are still enough pool people out there to find them worth the money and the additional responsibility.