Restrictions, mispricing can turn off buyers

With full-fledged sellers’ markets underway in dozens of metropolitan areas around the country, new research has found curious statistical patterns emerging: Even in cities where listings get multiple offers within days or hours, significant numbers of homes are sitting on the market for six months, 12 months or more with no takers. More

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Restrictions, mispricing can turn off buyers

Posted 5/6/13

With full-fledged sellers’ markets underway in dozens of metropolitan areas around the country, new research has found curious statistical patterns emerging: Even in cities where listings get multiple offers within days or hours, significant numbers of homes are sitting on the market for six months, 12 months or more with no takers.

Call them “turnoff listings.” Despite roaring sales paces all around them, for one reason or another these houses send shoppers scurrying away, often because of mispricing, excessive restrictions on access to buyers and agents, failure to clean or make repairs and a variety of other marketing bungles.

Researchers at Trulia, a real estate listings site, say the existence of large numbers of unsold houses in the midst of high-activity markets is more common than generally assumed. Jed Kolko, chief economist for Trulia, suggested that “even in the tightest markets, there is a ‘long tail’ of homes languishing” unsold for extended periods.

For example, in one of the fastest-paced sales areas in the country, San Jose, Calif., – where the median time from listing to sale is just 20 days – one out of 10 houses has been on the market for 161 days or more. In metropolitan Boston, where houses go from listing to sale in a median 42 days, 10 percent go unsold for 257 days or more.

Data provided for this column by MRIS, the multiple listing service covering metropolitan Washington, D.C., indicate that in the hottest neighborhoods, houses sell in a median five to 12 days. Yet from 10 percent to 12.5 percent of listings in some areas sit without buyers for six months or more.

Nationally, according to new data from the National Association of Realtors, 44 percent of all new listings take 90 days or more to sell, 22 percent take six to 12 months, and 9 percent take more than a year.

Why the glacial pace for certain homes in even the fastest-moving sellers’ markets? Realty agents who visit houses with potential buyers in tow aren’t shy about sharing the major reasons. One agent, Jeff Dowler of Solutions Real Estate in Carlsbad, Calif., says more often than not, the root problem is the owners of the property. As he guides shoppers from one listing to another, “I see homes being sabotaged by owners all the time.”

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