MARK LIPPOLT
Unrealistic sellers
Like sour milk whose date has expired, thousands of unsold homes are being yanked from the market by sellers.
The number of expired single-family home listings – those withdrawn from the market before a sale takes place – has grown 68 percent from two years ago. There were 14,602 expired listings through mid-August of this year, up from 8,692 during the same months in 2005, according to figures from the Multiple Listing Service Property Information Network.
Local brokers say some sellers are sticking to high asking prices that don’t reflect market conditions and their homes are not moving.
“Sellers who come to market at somewhat reasonable listing prices find that buyers do ultimately step up. But there’s a large universe of sellers who are not realistic and not successful in selling their homes,” said Mark Lippolt, executive vice president of Coldwell Banker Residential Brokerage.
There were fewer homes pulled from the MLS during the first eight months of the year than last year. Some 15,458 listings expired from January through mid-August of last year, according to MLS PIN. But homes today are taking longer to sell.
Single-family homes sold through Aug. 14 took an average of 136 days to sell, up 20 percent from a year earlier when the average days on market was 113, according to MLS PIN statistics.
“There are many listings that are on the market longer than six months, and even some at four months, which would cause the listing to expire,” said Doug Azarian, a Cape Cod broker who is president of the Massachusetts Association of Realtors.
Sellers typically sign contracts with agents to list a property for a certain period of time. In weaker markets when properties take longer to sell, six-month listings are more common. When sales are more brisk, agents are more willing to take a listing for three months or less.
Homes that don’t sell within the contracted time period are withdrawn from the MLS or referred to as expired. But homeowners who must sell have the option of a renewing the listing with the same agent or listing the property with a different broker.
MLS PIN can’t track what percentage of expired listings that are actually re-listed.
‘A False Hope’
Lippolt said the vast majority of home sales in Massachusetts are discretionary, meaning that sellers don’t have to sell because of a major life event such as a job change or divorce.
Since so many homeowners don’t have the urgency to sell, they don’t budge on prices, he explained.
“Buyers oftentimes fail to remember that the real estate transaction can be as optional and discretionary for the seller as it is for them as a buyer,” Lippolt said.
Some Realtors are refusing to work with sellers who won’t take their advice on pricing.
David Friedberg, who manages the Brookline office of Coldwell Banker Residential Brokerage, said his office has rejected listing properties for homeowners who were pushing for asking prices that were too high.
“We don’t want to just tell them that ‘OK, we’ll take the listing.’ It’s a false hope,” he said. “I will tell you from a business standpoint, from a social or ethical standpoint, I absolutely do not want my agents to be giving false hope to sellers.”
Last week, the Massachusetts Association of Realtors reported that the number of single-family homes listed for sale has dropped. There were 37,314 homes on sale as of July, 12 percent fewer than July 2006 when there were 42,467 listings, according to MAR. That translates to 8.6 months of supply, down from 10.3 months of supply during the same time in 2006.
Azarian said inventory levels are stabilizing, and he doesn’t expect them to climb back up to the high of last September when there was a 15-month supply of properties.
“There’s been a shrinkage of inventory and some of that is expired [listings],” agreed Friedberg, president-elect of the Greater Boston Association of Realtors.
Friedberg’s office had as many as 250 properties on sale a year ago. The inventory has fallen to 150 this year, he said.
Friedberg also noted that in Brookline, the number of expired listings has gone down. There have been 18 expired single-family home listings so far this year, compared to 48 last year, he said.
Dick Stevens, who manages the Hanover office of Jack Conway & Co., said some homeowners just get frustrated that they can’t sell their home at the price they want and decide to renovate or expand.
“I think some sellers basically get tired of the process of having the house on the market, of keeping it spiffed up and the disruption of real estate agents doing open houses. All of those things after a while become a source of aggravation,” Stevens said.
Stevens’ office tracks expired listings and contacts homeowners to see if they would be interested in using the services of Jack Conway & Co.
“There’s a fair number of [homeowners] that we never hear back from and they either resurface on the MLS because they re-list with the same agent or they’ve gone on with somebody else,” he said.
Sellers who have been successful are obtaining about 92 percent of their original asking price, which is similar to a year earlier, according to MLS PIN.
At the height of the market three or four years ago, sellers were getting as much as 95 percent to 100 percent of the listing price, brokers say.
“In some ways, many sellers felt that they would take advantage of what was a very strong appreciating market and it really wasn’t until a year ago, February or so, when Â… the market really started to slow down,” Azarian said.
Some homeowners still think they can sell at prices that their neighbors obtained a year or two earlier, said Azarian. “They hold onto price, and that will cause properties to sit on the market and expire,” he said.
