Madison Wisconsin Homes and Real Estate: By Necessity We're All Learning to Rebuild a Better Real Estate Community

Wednesday, June 8, 2011

By Necessity We're All Learning to Rebuild a Better Real Estate Community

"Necessity is the mother of invention." Maybe Plato said it first, but we're living it today. Difficult situations have inspired us to apply solutions which are sometimes smart, sometimes ingenious, at times unique and creative. Usually these solutions are not all together new, and sometimes they are neither smart nor effective. But, we are living and learning and moving forward regardless of the results of the lever pulling behind the curtain of Oz.

A new consumer of real estate and real estate services is emerging. Ambiguity is flushed out by inquisitive consumers, service providers, and underwriters. Owners are demanding better evidence of a buyer's ability to consummate a purchase and buyers are taking more time to consider the implications of a contract before committing. That's wise, because the lenders and sellers are holding buyers accountable right up to closing.

The service is changing too. As Realtors and mortgage lenders who can't make a profit in their business leave the industry, they make room for enthusiastic business minded people who come in with their expectations in check. Real estate firms have adjusted their training/coaching to develop talented people to be effective Realtors in the new economy. These new licensees know no other market. They aren't burdened by the "old ideas" and start fresh learning the basic principles of highly effective business models. Maybe by the end of this year we will see that 20+% of the licensees terminate their membership in the National Association of Realtors in the last 24 months. That's good for the consumer. No industry is capable of providing exceptional service with people who are one foot out the door.... or further. The mortgage lenders who didn't give up their day jobs are out and the skilled, responsible people are again dominating our market. These are not times for order takers. Smart people who solve challenges, without creating them, are in charge.

Everyone in the process, buyers, sellers, lenders, Realtors, title companies,.. everyone, has learned and trimmed of the fat of recklessness; and the process is healthy. Back to what it was? Definitely not. Will it get back to what it once was? Hopefully not. Those of us who have been in real estate for 15, 20 and 30 years owe it to the community to rebuild a better real estate community before we leave.

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If Not Sold in the First 30 Days, Successful Sellers Conceded The Price

Through Mid-September, thirty seven percent (37%) of 126 home owners who sold in 2010 sold without making a single price concession. They typically attracted a buyer within 40 days of going on to the market. These successful owners conceded little on price as they sold for about 97%-98% of asking price.

Those who counted time on the market by months or even quarters eventually sold for an average of 91% of their initial asking price. Price reductions improved their success opportunity. Once their price was reduced to a price favorable to a buyer, the time on the market was short--about 34 days from last price change to accepted offer.

See September 20, Buyer Enticing Pricing

Disclosure

The source of data: South Central WI MLS Type of data: Single family homes and maybe condos and maybe other Areas: Madison and other areas such as McFarland, Shorewood Hills, Middleton, Maple Bluff, Oregon, DeForest, Cross Plains, Dane County, Fitchburg, Verona, did I say Middleton? Dates covered in these blog posts: January 2010 and continuing.

All comments are the relatively well thought out opinions of Tom Meyer. Those opinions are not necessarily shared by Restaino & Associates, other brokers, or the national, local, or state associations of Realtors... in fact, they may be significantly different.