REal Talk July 1, 2021 – How’s the Market?
Oh, hi Bonnie.
How are you today? I’m so well, it’s a holiday week coming up.
So it’s a little slow, but we are prepping two listings, which is exciting. One in west orange and one in south orange. No Maplewood, excuse me for next week. So I think we will see an influx of inventory post-holiday there was nothing really new to see. Today only a couple of things for broker opens. We thought we would kind of address something. I ran into a client yesterday who said I’m seeing all these things close and I can’t figure it out. I can’t figure out why some homes are going for $200,000 over asking and some are going for under list price. And I’m just totally confused. And, you know,
We were talking about how that’s the first question that a lot of people ask us whenever they run into us on the street or at a party, how is the market? And it’s not a simple answer.
No, it’s not. There’s many layers to it. And you know, we want to try to explain that to you as best as possible. But again, if you have a specific question about a specific house, we’re happy to talk through it, but really a lot depends on not just what you see on paper, but you have to go in the house. You have to see, is it really a diamond in the rough or is it just rough as soon as he says, or you know, how well does it actually show in person? Because there’s a lot of buyers coming through these houses and some of them just, they might look great, you know, on online, but you go inside and they feel tired or they feel cheap versus one that doesn’t. So if you see it…
Or they look actually better in person than they do in the picture. So it’s sold for $400,000 over asking, but in the pictures they don’t look that great and you didn’t step foot in the house. You don’t know how magical it was.
Right. And, and a lot of people think the list price is the price that it should be, but oftentimes homes are mispriced, they’re priced too high or too low for various reasons. And you need a solid agent who’s experienced that can really help you understand the price, the way it’s positioned. Was it positioned correctly or too high or too low, because that will dictate what home sells for.
And what was the strategy? And what was the competition that particular weekend? And what were the conditions under which, you know, that that price was established. So we have seen a lot of different activity with this prices and then how things have sold from 2019 moving into 2021. But we do look at a lot of reports. We do look at a lot of data. It’s just not the end of the story. So we look at data from the GSMLS, which is where we mostly operate the Garden State MLS. And for example, I just pulled one this morning, looking at every month for the past 12 months from 2019, comparing to 2020 and comparing to 2021 and one small data point that we can just talk about here is in June of 2019, there were 156 active listings, 7 57 new listings that month in June of 2020 by comparison.
So 156 active listings in 2019 versus 2021 that 109 active listings. And in 2021, we have 92 active listings. And the new listing comparison would be in 20, 19 57, new listings in 20, 20, 53 new listings and in 20 21 67 new listings. So, you know, again, when you just look at the numbers that you don’t know what the story is, that is being told, and you can’t really even know the story just by looking at all the listings year by year. But because Bonnie and I had been in the market for all of those years, we can sort of come to some conclusions about what that looks like.
Right. Another example would be spring market, which usually kind of starts up late January to February and runs through may with a last little bump in June. And obviously last year during COVID with the shutdown in March, we spring, I mean, spring market was really pushed back to April may. And so it went through August. So we had a really crazy summer last year, right this year, you know, it feels like spring market has had kind of died down and now we’re having a huge influx of inventory in June. I think a lot of people wanted to stay safely in their homes until their kids were done with school. And now, you know, some markets are softening and they’re able to find a new home elsewhere and put their house on the market. So every year is a little bit different, especially, you know, these last few years obviously and every weekend we talk about this a lot, every weekend is different. It really depends on the weather. It depends on when the holidays were, when the kids got out of school, so many factors, and we’re looking at New York city school districts, you know, out to Jersey and, you know, trying to figure out the pattern, the traffic pattern, if you will. And it changes every weekend. And that definitely affects the competition on the houses from week to week.
And it definitely depends. And it impacts how we list our listings, how we advise our sellers and it impacts how we advise our buyers. And because we work with both, and we’ve said this many times before Bonnie and I work with both buyers and sellers. So we’re keenly aware of how both of those parties and those pools of people are affecting the other. I just want to point out one other point. And I think Bonnie was speaking to as well, is that in 2019, the average days on market for sold listings was 38 days. The average days on market in 2020 was 35 days. And the average days on market from June to June in 2021 has been 23 days. So it’s gone from 38 days to 23 days. But again, that’s an average.
And just to quickly explain to you, days on market would be from the day we list on the MLS where it’s public knowledge through the open house, through the offers through attorney review until we are under contract. And so, you know, there’s a lot of factors that can expand that number, but this is telling you the we’re moving very quickly, which means you have to be ready to jump.
Yeah. And the sale prices have gone. The list price to sale price ratio has gone from a hundred, 2% to a hundred, 1% last year, which seems a little weird and then 108% this year. So again, averages, don’t tell the whole story, right? Points by price points. If we dug down deeper into like what each band of price points was doing. Which neighborhoods were showing growth, I’m sure we’d see a whole different story. Anyway, all that to say, if you have questions about the market, if you want to ask that question, that big million dollar question, how’s the market doing call us, because then we can ask you your specific circumstances and how to answer that in a way that’s meaningful to you and your family.
Right. And we do provide data on our website. We call them market reports by city. You can click on that and read list prices and sale prices and things like that. But it can be confusing. So just call us and say, what does this number mean? I’m just curiousyou know, just for fun, I want to understand this and we’re happy to talk you through it because it is a lot of, a lot of numbers and it can be hard to interpret.
Yeah. But it is fascinating. And so go to our website, Adamsonramsey.com, sign up to get updates and just reach out to us at info@adamsonramsey.Com if you ever need any help.
Yes. We wish you a wonderful 4th of July. Stay safe and we’ll see you next week and dry.