Why you Don't Want an Average Listing

If you're selling your home, here's why you don't want to rely on an "average" listing:

In 2007, only 52% of all Dane County single family home listings resulted in a successful closing.

And only 40% of all Dane County condo listings resulted in a sale.

The trend toward lower listing success rates has continued into the current year, as year-to-date success rates for both homes and condos are below the levels from the same time period last year. You'll find more details for both homes and condos at DaneCountyMarket.com.

When you dig deeper, you'll see the data clearly shows that sellers tend to be much more successful in the warmer months than in the colder months. If your home is on the market now, what does this mean for you?

You have more leverage right now than you'll have at any other time of the year.

If your goal is to sell your home this summer, now is a good time to review your current plans and make sure your approach is on the mark.

Some questions to consider:

1. Is your home looking its best?
2. Have you done your homework? Do you know your competition and understand the market dynamics of your neighborhood?
3. At your current price point, does your home offer comparable value to those homes in your neighborhood which have recently sold?
4. Is your marketing plan generating a good number of showings for buyers who are truly eager to buy?
5. Is your home receiving good feedback from buyers and buyer agents?

If you answered "no" to any of the above questions, consider adjusting your current approach while the peak buying season is still with us.

The Dane County Real Estate Market - Expired Listing Trends

As Dane County sales volume has decreased, the number of expired listings has increased significantly over the last 3 years.

The trend toward an increasing number of expired listings has been most significant in the local condo market. In 2004, 573 condo listings expired in Dane County. The number of expired listings has grown steadily since that time, topping out at 2,603 in 2007. In the 3 year stretch from 2004 to 2007 the number of expired Dane County condo listings increased by over 350%. Meanwhile, condo sales volume decreased by 4% over the same 3 year period.

A greater number of listings are also expiring in the Dane County single family home market. In 2004, 2,004 single family home listings expired in Dane County. That number grew to 4,506 expired listings in 2007 - an increase of 125%. During the same 3 year time period, single family home sales volume decreased by 15%.

Although the Dane County real estate market has not experienced the dramatic price declines experienced by many other markets, the trend toward an increasing number of expired listings shows how competitive the market has become for sellers, especially those owning condos.

In our next post, we'll share how the listing success rate for Dane County homes and condos has changed over time. The listing success rate is a great metric for tracking the market because it measures the likelihood that the "average" home or condo listing will result in a successful closing.

The Dane County Real Estate Market - Sales Volume Trends

Dane County inventory has fallen from the levels of 2007, an encouraging trend for sellers. However, there is another trend at work which is helping to keep inventory near its all-time high.

Sales volume has been on the decline, for both homes and condos. And the rate of decline has increased in recent months.

Looking at Dane County homes, the peak year for sales volume was 2005. In 2006, sales volume fell by 11% from the prior year, and volume fell another 5% in 2007. This year, year-to-date sales volume through the month of March has decreased by over 28% from the same time period last year.

The trend for Dane County condos has mirrored the trend for Dane County homes. In 2006, sales volume fell by 9%, and volume decreased by another 10% in 2007. This year, year-to-date sales volume through the month of March has decreased by 21% from the same time period last year.

If you're selling your home, what does this mean for you? With fewer buyers out in the market, you need to compete for your sale. Your pricing, presentation, and marketing plan are all key elements in the sale of your home.

Also keep in mind that all real estate is local, even down to the neighborhood level. Both the supply and the demand for housing can vary greatly from one location to the next. Your odds for success will increase greatly when either you or your realtor invest the time to understand the market dynamics of your particular neighborhood.

The Dane County Real Estate Market - Housing Supply Trends

The Dane County real estate market becomes a lot easier to understand when you break it down into pieces, which is exactly what we'll be doing twice a week for the next several weeks. We'll start by taking a look at recent trends in housing supply.

Each month we take a snapshot of the total number of active MLS listings for homes and condos and update our inventory trend report at DaneCountyMarket.com. As of April 30th, the total supply of Dane County homes and condos was 311 units lower than the inventory level from the same time last year. This is an encouraging trend for sellers, but if you look at the graph below, you'll see that the current inventory level is still high by historical standards. In fact the current level of Dane County inventory more than doubles the inventory level from January of 2005.


When can we expect the supply of homes and condos to recede well below peak levels? This remains to be seen, but it's safe to say that the market will need some time to digest the inventory that is currently on the market.

One reason is that the demand for housing in 2008 is well below the levels from the last several years. We'll cover this trend in more detail in our next post.

Another reason is that Dane County foreclosures are on the rise. As more and more foreclosure listings enter the market, we'll continue to see upward pressure on inventory levels for Dane County homes and condos.