Rochester MN Real Estate Market Blog

Sellers typically focus on what list price will sell their home quickly and for top dollar.  But when your home isn’t the only one in the neighborhood for sale, your asking price can actually result in selling your neighbor’s home instead.

How? If your home is priced too high, it can make your neighbor’s home seem like a bargain.  Inaccurate pricing can result in extended market time which leads buyers to wonder what is wrong with your property, again shifting interest toward other properties in the area which are newer to the market. 

This effect is even greater in a down market: higher inventories of homes for sale mean even greater competition for the buyer pool amid already increased average market times.  Multiple homes for sale in one neighborhood further intensify the competition for buyer attention.

To increase the likelihood that your home will sell faster than average and for a better price, you need to be sure your initial asking price is appropriate for current market conditions and is competitive with neighboring listings.

Price is one of the first details potential buyers learn about a property, and it strongly influences which homes they preview and consider.  Prospective buyers will be comparing your home to the other homes in that price range and in the neighborhood.

Therefore, you need to make similar comparisons when you set your price, identifying the pros and cons of your home with respect to others in the area.  The risk of not doing this is overpricing your home with respect to the competition.

Pricing your home right in the first place requires knowing the market and knowing your home’s competition.  A Realtor who knows your neighborhood and understands the current market trends can help you determine a range for your initial asking price.

Your Realtor should compare your home to similar homes that have sold recently in your neighborhood, making adjustments for the differences between them.  The market analysis should then consider how your home measures up to homes currently listed for sale.

It can pay to be aggressive.  Pricing your home competitively can increase the chances that yours is the home that will sell quickly and for top dollar.

copyright 2010 Shawn Buryska

The spring market is heating up quickly and there is the potential for greater sales volume than we’ve seen in quite a while as the deadline for taking advantage of the home buyer tax credit looms.  First-time home buyers purchasing on or after January 1, 2009 and on or before April 30, 2010 may be eligible for a tax credit of up to $8,000.  Home buyers who have owned a home for five consecutive years out of the prior eight years who purchase a home after November 6, 2009 and on or before April 30, 2010 may be eligible for a tax credit of up to $6,500.  Income limits and other restrictions may apply.

The volume of new listings continued to surge forward with 42% more new listings in February (284) than the month before.  The total number of active listings in February (1012) was up 13% over the previous month, and homes sold (68) were up nearly 20% from January.  Homes going under contract to pending (103)  were up 27% over the previous month.  Average market time to pending dropped to 131 days, down 6.4% from January, 2010 and down 12.7% from February 2009.

For the latest in all the local real estate stats make sure to check out http://www.shawnburyska.com/real-estate-statistics.php

For more information on the home buyer tax credit, the National Association of Home Builders has put together a great website: http://www.federalhousingtaxcredit.com/home.html.

Shawn Buryska ABR, CRS, GRI
Coldwell Banker Burnet Realty
507-252-6745
www.ShawnBuryska.com

Good Morning!

There are currently 1129 residential properties for sale in Rochester, Minnesota, 50% more than this time a month ago and 10% higher than a year ago.  The average list price for these homes is $223,765 (median $174,900) and average market time is 150 days.  Last week (March 1 to 7, 2010) there were 1146 homes for sale with an average list price of $222,932 (median $172,900) and 150 days on the market.

There were 112 new listings last week, an increase of 22% from last year according to the Multiple Listing Service (MLS), and 19 that came back on the market with an average asking price of $232,311 (median $172,900) and $185,278 (median $167,900) respectively.  Nine listings canceled, 15 listings expired, and 15 were extended.

The 38 listings that went under contract last week to pending represented a 41% increase over last year and  had an average list price of $160,309 (median $155,000) and an average of 155 days on the market. 

There were 13 homes that closed last week, half as many as last year, with an average market time of 149 days.  The average sold price of $150,119 (median $145,000) was 97.8% of the list price, 92.3% of the original asking price.  Last year the homes that sold in the first week of March averaged 96% of the list price.

Good morning!

There are currently 1054 active residential listings in Rochester, Minnesota.  Average list price for these homes is $220,936 (median $174,900), average market time is 161 days.

According to the MLS (Multiple Listing Service) there were 23 homes that went under contract to pending last week with an average asking price of $166,471 (median $151,550) and an average of 91 days on the marktet.  The 18 homes that sold (closed) last week had an average of 144 days on the market.  The average sales price for these homes ($202,338, median $168,750) was 99.8% of the asking price, 96.6% of the original list price.

The MLS reports indicate there were 69 new listings last week and 8 that came back on the market with an average list price of $203,797 (median $169,900) and $199,287 (median $209,900) respectively.  One listing was withdrawn, 5 canceled, 4 expired, and 15 were extended.

Good morning!

There are currently 1009 active residential listings for sale in Rochester, MN according to the Multiple Listing Service (MLS), with a median asking price of $174,900 and average of 163 days on the market.

Twelve listings sold last week (February 15-21, 2010) with an average sold price of $125,495 (median $117,950), 97.6% of the asking price, just 88.6% of the original list price.  These homes had an average market time of 135 days.  There were 32 homes that went under contract to pending with an average asking price of $224,375 (median $189,900) an average market time of 138 days.

Last week there 77 new listings and 12 that came back on the market with average list price of $188,990 (median $158,900) and $223,133 (median $164,900) respectively.  One listing was withdrawn, 7 canceled, 12 expired and 14 were extended.

There’s an old real estate adage that the first offer you receive is usually the best one, and my experience in 20+ years as a Realtor supports this.  I’ve encountered several listings where the seller received an offer early on, made a stiff counteroffer back to the buyer and the buyer headed for the hills. In some cases, as much as 24 months and several price reductions later, another offer finally came in only to be significantly lower than the first buyer’s offer. While your first offer may not be what you were hoping for, it is a good idea to consider several things when choosing how to respond to that offer. 

Length of time on the market, time of year, initial asking price compared to the price recommended by your agent, and current competition should all be taken into account when determining whether to accept, reject or counter the first offer you receive.

It may be tempting to hold out for a better price, especially in the first few weeks that your home is on the market when there is a high volume of showing activity. However, that activity typically wanes after about three weeks, at which point the buyers who have been waiting for “just the right house” will have already considered your property. Buyers rush to see new listings, and if it’s the best thing they have seen they will probably make an offer. Most of these buyers have been at it for a long time and know the values very well, in some cases understanding market realities in their price range even better than realtors who have been tracking a broad market. Therefore, an offer received in the first few weeks on the market is probably appropriate to current conditions and worth serious consideration. Comparing the offer to your realtor’s initial price recommendations can help you decide what action to take.

It is especially important to price your home accurately from the outset given the current market conditions.  The homes that are selling quickly are capturing prices within an average of 3% or less of the asking price.  The longer the home is on the market, the larger the gap between original asking price and sales price.

After the first several weeks, the activity that remains is buyers just entering the market. Since they are at the beginning of their house hunting, they generally have more time to look and are less motivated to act quickly. They are less educated about the market than those who have been shopping for a long time and will err on the side of caution when making their offers, especially in a buyer’s market. Consequently, offers will more likely be lower than early on.

Time on the market erodes value as well. The longer a house is listed for sale, the less interested buyers and Realtors are in the property. People will begin to wonder what is wrong with the property, and even if they like it will offer a lower price so they won’t lose money if they end up having to sell.

Be sure to consider the opportunity costs. While your first offer may be lower than you had hoped, every month you keep the property is another month you must pay mortgage, taxes, utilities, and insurance for a home you are hoping to leave. These costs can add up quickly and end up costing you more in the long run.
Time of year is another factor that can affect the offer. Your offer in March or April will most likely be much higher than in September or October. Sellers who were optimistic in the spring will be lowering their prices quickly to try and sell.

When a house sells quickly, there can be the temptation to second-guess whether the home was priced appropriately to begin with or whether a higher price was possible.  However, if the proper price range is targeted when the house is first listed, the actual selling price is likely to be higher.  Longer market times typically mean price reductions.  Current market conditions have homes selling at within approximately 3% of the asking price, and the longer the market time the larger the difference between sales price and original asking price.  This means there’s a very small margin for error in pricing the house from the outset. 

The bottom line is that you are never in a better position to get the best price for your home than when it is fresh on the market. Even if the offer and subsequent negotiations are less than you are hoping for, don’t kick yourself months or even years later wishing you had taken the offer. That real estate rule of thumb stays true: your first offer is usually your best.

Copyright © Shawn Buryska

It’s February so it’s not too soon for crocuses and “for sale” signs to start popping up in front yards all over town.  New listings were on the upswing in the first month of the year, heralding the beginning of the spring market. 

 The number of total active listings in January, 2010 was up 44% over January, 2009.  The number of homes going under contract and homes that closed were down 15% and 16% respectively, and the median sales price was down to $149,000 from $153,400 for the same time period last year.  Average market time to pending increased in January to 140 days, just over 2 weeks longer than the last month of 2009 and 3 weeks longer than last January.

The supply/demand ratio reached its highest level since last January with just over 15-1/2 months inventory, a normal occurrence this time of year as more homes come on the market in anticipation of the spring selling season. 

For the latest in all the local real estate stats make sure to check out http://www.shawnburyska.com/real-estate-statistics.php

Shawn Buryska ABR, CRS, GRI
Coldwell Banker Burnet Realty
507-252-6745
www.ShawnBuryska.com

Good morning and happy President’s Day!

There are currently 969 residential homes for sale in Rochester, MN with an average list price of $224,583 (median $176,900) and an average of 171 days on the market.

According to the Multiple Listing Service (MLS) last week (February 8 to 14, 2010) the volume of new listings was down 26% compared to the same time period a year ago; there were 52 new listings and 12 that came back on the market.  Average asking price was $222,937 (median $194,000) and $228,906 (median $234,900) respectively. One listing was withdrawn last week, 5 canceled, 6 expired, and 20 were extended.

There were 15 listings that went to pending last week, down 44% from last year.  These properties had an average list price of $163,521 (median $122,900) and an average market time of 135 days.  The MLS reports that there were 8 homes that sold (closed) last week, an increase of 1/3 over the same time last year.  The average sold price of $145,737 (median $152,150) was 97.4% of the asking price, 91.9% of the original list price.  These homes averaged 107 days on the market.

I’ve taken a new listing at 1406 30^th St SW Rochester, MN 55902.  It is a 5 bedroom, 4 bath 2 story in Bamberwood.  The listing number is 4018106 and the home info line number is 396220.  You can find all the details here.

I’ve taken a new listing at 9802 County Road 19 SE Stewartville, MN 55976.  It is a 3 bedroom, 3 bath ranch.  The listing number is 4017898 and the home info line number is 398200.  You can find all the details here.