If you've shopped for a home lately, I'm sure you've noticed this deja vu phenomenon. A property gets emailed to you flagged as "new on the market." Breathlessly you open the email and ask yourself, "could this be The One?" But your heart sinks when you realize you went to the open home for this place a month ago. What happened? The property, still on the market, has been
re-listed.Why re-list? A few reasons:
- Reset the Days-on-market: When a property sits on the market too long, people start whispering... "what's wrong with that place?" A "new" listing resets that DoM to zero. Makes it seem fresh. In many local California real estate markets, more than just 30 days on market is a red flag for buyer.
- Lowering the price: You can, of course, lower the price on an existing listing. But when you take it off the market and re-list it, the price history isn't as readily available. The casual home buyer won't see that the seller is getting more motivated.
- Free Marketing: Anyone can sign up for those email services that alert you when a new place comes on the market. So re-list and get pushed back in front of all the subscribers.
- Test-the-waters: Watch your neighborhood closely and you will see what I call serial re-listers. People who test the market and then pull the house off, only to test again in a few months. In our experience, this is actually a small percentage of re-listing activity. But it should be filtered out nonetheless.
But how pervasive is re-listing? A conversation with a new customer prompted us to do the following analysis. For a handful of Washington and California housing markets, we looked at all properties currently on the market and identified what percentage of them had been re-listed at least once since the beginning of the year. Some of these relistings were done purely for reasons 1. and 3. because they kept the price the same. Here's what we found:
So in Los Gatos, fully 40% of the homes currently on the market have been re-listed. Mostly this was done to drop the price. But one-in-ten were re-listed just to game the MLS's DoM count. That's why when we calculate Days-on-Market in a report for, say, the Los Gatos Real Estate Market, we actually comb through the data and remove this anomaly.
To be sure, any agent will be able to get the listing history for a given property. Make sure you get it before you make an offer. Also make sure you pay attention to the true Days on Market when trying to measure your local real estate market conditions. Want to get some insightful housing demand indicators? The local re-list percentage is a good place to start.
The Pine Needle Lawn is the happy host of this weeks (6th edition) Carnival of Real Estate Blogs. What is a blog carnival? Get the answer here. This carnival was started by the folks at the Zillow Blog to help bring the real estate blogging comm...
Tracked: Aug 21, 06:32
Every week the Carnival of Real Estate runs a collection of interesting blog articles from the previous week. The Carnival is hosted this week by PineNeedleLawn blog (who usually post about lake properties in Minnesota, Wisconsin, and Michigan - Ya hey
Tracked: Aug 21, 09:05
With my posts about San Jose median home prices for our Inkling market, I've been trying to uncover a different interesting tidbit about the San Jose real estate market each week. This week is a fun one: Flipping. Buy-low and quickly sell high. First th
Tracked: Sep 05, 17:29
A few weeks ago, we introduced in our paid research three new statistics tracking the percentage of properties in a market that have been priced-reduced, re-listed, or flipped. Re-listing is the tactic used by agents to re-introduce a property to the ma
Tracked: Sep 21, 20:05
Some readers have asked lately about a recent jump in our Days on Market statistic. I thought it makes sense to explain it here. We recently did a methodology change where we increased the look-back window for watching properties. By making this change
Tracked: Feb 09, 11:56