Low ball Offers Can Work For Buyers And Sellers With Knowledge of The List -To- Sale Ratio | Port Orange FL Homes For Sale
December 5th, 2007 Categories: 1st Time Port Orange Home Buyers, Port Orange Real Estate
Buyers are in the driver’s seat in a buyers market and sellers are up against low ball offers in a buyer’s market.
The buyer wants the house because it’s a perfect fit and the seller is anxious to sell in a slow market!
The list-to-sale ratio is calculated by taking the sales price and dividing by the list price then multiplying by 100.
For example if a Port Orange home is listed for $250,000 and the house sold for $200,000 then:
200000/250000 x 100 = 80%
In this case we see that the home sold for 80% of the list price.
If you calculate the average list to sale ratio for a neighborhood it will give you the average for the comparable sales price of neighboring properties.
So, with this in mind when you have a low ball offer of $175,000 on a $250,000 home, your buyer’s offer is 30% below the list price. You can show your buyer that this offer is 10% below the average price that sellers are accepting in that neighborhood. Perhaps the buyer and seller can continue to negotiate and have a meeting of the minds with information that is necessary in coming to a agreeable conclusion for both parties!
On the flip side, sellers can look at this offer as being only 10% off the average and realize in a buyer’s market that this is not so bad!
Know your list to sale ratio! It is valuable in knowing the current market conditions! Call Team Gagliardi for more valuable real estate data !
386.316.5968
Do you find that Port Orange sellers are reluctant to lower their list price down to closer to where they will actually sell?
Great stuff Janis-sellers need to be aware of this %, as well as the sold comps. Expert advice from an Port Orange expert. Thanks J. Terry McDonald
Good information and advice Janis. Buyers are in control right now and they know it.
I don’t know how your MLS data reads, but ours does not take into account any price reductions when calculating list-to-sale ratio. In other words, if a home was listed at $145,900, later reduced to $139,900, then sold for $139,500, the MLS shows it sold for 99.7% of list price.
Some agents probably won’t catch that when helping a buyer determine what to offer. Good thing Port Orange home buyers have a true real estate professional that will “tell it like it is”.
Charles- Our MLS here in the DC area recently changed to include the NET sale. So it will look at the original list price, the last list price and even the seller concessions. All this gives you the true price of what a home sold for when compared to it’s original list price and other listings.
Great post Janis. Most people don’t realize that if you look at this ratio you will get a better idea of what a seller will accept- rather than the $$ figure.
John, sellers are normally holding fast to their prices as many are getting low ball offers.
Buyers definately have the advantage, however, not every home is subject to low ball offers. Those which are priced right are selling for full price. Price is always key!
I wish we had the functionality of your MLS. I have to figure these stats for my clients. Our MLS allows the DOM to reset every time a listing is renewed. Then we have to go look at the history to see the original list price.