Most Sand Section Sales Take a Cut

By Dave Fratello | February 27th, 2020

Often, when we're doing an analysis for clients that turns up interesting info, we like to share it here on the blog.

So that's what brings you today's latest.

We were evaluating the Sand Section market, and ran an analysis on some recent history.

Turns out, in a common price range, the vast majority of recent sales have taken a cut in price before selling.

Actually, about 81%.

Now, this is for the price range of $2.500M-$7.000M.

Almost 2/3rds of sales in the Sand Section occur in that price range.

So, this is telling you that not every Sand Section property is so hot that it generates multiple offers and goes over asking.

In fact, just about 9% sold over asking. Several were just $1K over, and almost all were within $25-50K of the start price, even when going over.

You would want to compare stats from this period with something else. So let's take a look.

First, we looked at Tree Section sales over the same period. We didn't bracket out any specific price ranges. Over the same 2 years, 69% of Tree Section homes sold with a price cut.

Next, we looked at the 2-year period in the Sand Section prior to this one, meaning 2016-18, same price range ($2.500M-$7.000M).

For that period, 67% of Sand Section sales had a cut.

Now express it all another way.

The share of Sand Section homes selling with a cut went up by 14% overall, when comparing two different 2-year periods.

And the number of Sand Section homes selling with a cut exceeded the number with cuts in the Tree Section by 12% in the same time period.

This is a novel way to add context to some other data that showed cooling in the Sand Section. Our Q3 2019 market report found higher inventory, lower median price and lower median PPSF, all as recent trends in the Sand Section.

By the way, we were just inquiring about that price range in the Sand ($2.5-7.0M) for a specific reason for the client. But we also looked at the sales outside that range.

We found that virtually every sale over $7.0M had a price cut, while 71% of those under $2.5M had a cut.

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