Inventory in the Hill Section is still well above normal for recent years at 26
, by our most recent count. (Download the MB Market Update Spreadsheets for more.)
With the newest closed sale in the sub-region posting late last week, we now have a sample of 15
sales over the past 6 months to use to suggest some advice for anyone wishing to get a listing off the actives and into the "sold" column.
In a phrase: Chop by double digits.
(In percentage terms.)
That's what 11
of the 15
sales did to make a deal, and we're not talking about run-of-the-mill 10-15% discounts in most cases.
Take the most recent closed sale as an example: 881 10th
originally sought $2.889m
, or $89k more than the sellers had paid in April 2006.
In a stunning capitulation, they dropped to $2.150m
to make a deal. That's 26% off
the start price.
But that sale is no anomaly.
Chops like that have been the rule, not the exception.
As our graphic here shows (click to enlarge), 6
other closed sales chopped 26% or more
off their (obviously) overly optimistic start prices. Two more chopped 24% and 25%.
That's 9 of 15 sales at 24% or more off, and we reach 11 with double-digit cuts by incorporating 2 additional sales that cut 15% and 17%.
These are symptoms of a market that is high-end and also overvalued, lacking in action and sufficient market cues.
Actually, the cues are coming in – and they're saying that most sellers who set prices in 2008, and to some degree in 2009, had a badly inflated sense of what the market would bear.
Of course, chopping 20% or more doesn't guarantee success.
Just ask the folks selling 815 2nd
(speckie short sale, pictured
) or 218 Anderson
(dream property, once $10m, now $7m). Each property is down 30%
from start, but no action.
Or 222 N. Poinsettia
(overvalued double lot), down 37%
and finishing its 14th month on market.
Or, finally, 114 N. Poinsettia
, down 36%
(UPDATED) from its start in May 2008. They took time off the market before returning at $5.495m
this past February, and held firm there for 7 months. A half-million-dollar cut was made the day this story first appeared, to $4.995m
Going back to the list of recent sales, the standouts for appropriate pricing are:
- 1023 10th, a speckie that sold for $2.45m largely before anyone took note;
- 620 9th, a big house with some rehab needs that got the spotlight here at MBC for its "aggressive" start price (see "Low on the Hill"); and
- 929 John, a little one-story (3br/3ba, 1875 sq. ft.) with a pool on a corner lot that didn't push the ceiling and wound up selling immediately (essentially pre-market).
So it's possible to get the pricing right out of the blocks. But you might need a little help from your friends (and neighbors).