2023 Real Estate Observations (Westwood, Washington: complex, coffee, person)

[msRB311]

I think if list price really didn't matter...then it really wouldn't matter....but it does. Everyday houses go on the market with a price that is similar to what other homes in the area recently sold for.

[newenglandgal123]

Originally Posted by MikePRU

You can find anything you want "hard to believe." I can tell you that whether you believe it or not, that doesn't preclude it from being a fact or the truth. There seems to be a resurgence in people who believe the world is flat too. Just because those people think it is doesn't make it so.

I can assure you the dataset I'm using to make this statement is much bigger and likely more recent than whatever experiences you're relying on because I live and breath real estate. It's my career.



You seem to think I just make this stuff up. Here's one from last year:

https://www.realtor.com/realestatean...il/M3022298399

FYI, over the last 5 years there have been 183 listings in MLSPIN that have been priced at $1. Also, I'm just going to say up front that no I'm not going to provide you with all of those listings to prove it. You can take my word or not.

I have no doubt there are people offering $300K over list on homes. There have been examples shown here on this forum, I think I even shared one awhile back in Westwood or Duxbury. What I highly doubt is that there's a line up of people willing to offer $300K over list all on the same house that ultimately sells for that crazy $300K over list.


Funny, this Sutton one doesn't show on zillow or redfin in price history for $1 or say how long it was even on market for that price. Looks like it never sold either!


That's ok...I have someone who could provide me the listings from the MLS if I really wanted them.

[msRB311]

Again - when I've seen homes listed for dollar it's because there's an estate/inheritance thing going on. Who in the hell prices their home at $1? If people do just to see what they get it's a very small number of people.

[Iced_Coffee]

I think the $1 listing thing should be viewed solely as what it is - an extreme example. Most situations are very obviously not that extreme, but they exist to varying degrees. The point was to explain that what a seller lists their house for ISN'T the actual market-value of a house. While it might behoove a seller to list for a price that's CLOSE to what the expected value is, at the end of the day the list price is a strategic decision, primarily made to increase views, interest, and ultimately offers. The sale price is the actual value. And that's why Realtors/agents use recent sales (comps) when doing analyses and guiding clients. Focusing on the sale price and how it compares to the list price is low-hanging fruit, and ultimately pretty meaningless without further context.

If you're trying to make an assessment whether or not a buyer overpaid, you need more data. This isn't to say that paying over asking can't mean it was a bad deal for a buyer, it's just that one shouldn't assume that someone overpaid SOLELY because they paid above asking. MikePRU gave some extreme examples to prove a point.

[newenglandgal123]

Originally Posted by Iced_Coffee

I think the $1 listing thing should be viewed solely as what it is - an extreme example. Most situations are very obviously not that extreme, but they exist to varying degrees. The point was to explain that what a seller lists their house for ISN'T the actual market-value of a house. While it might behoove a seller to list for a price that's CLOSE to what the expected value is, at the end of the day the list price is a strategic decision, primarily made to increase views, interest, and ultimately offers. The sale price is the actual value. And that's why Realtors/agents use recent sales (comps) when doing analyses and guiding clients. Focusing on the sale price and how it compares to the list price is low-hanging fruit, and ultimately pretty meaningless without further context.

If you're trying to make an assessment whether or not a buyer overpaid, you need more data. This isn't to say that paying over asking can't mean it was a bad deal for a buyer, it's just that one shouldn't assume that someone overpaid SOLELY because they paid above asking. MikePRU gave some extreme examples to prove a point.

If an agent lists artificially low and someone offers $300K over which makes it at true market value with comps then it's not overpaying. Shame on whatever agent goes to that extreme or doesn't know how to price appropriately though. If an agent prices just below true market value and someone offers $300K over because they are in competition mode and want to flex that they can beat everyone and 'win' the house well....they are just dumb and will have to live with the consequences that action might have if they ever try to sell and might have to sell for less than what they paid for it.

[Iced_Coffee]

Originally Posted by newenglandgal123

If an agent lists artificially low and someone offers $300K over which makes it at true market value with comps then it's not overpaying. Shame on whatever agent goes to that extreme or doesn't know how to price appropriately though. If an agent prices just below true market value and someone offers $300K over because they are in competition mode and want to flex that they can beat everyone and 'win' the house well....they are just dumb and will have to live with the consequences that action might have if they ever try to sell and might have to sell for less than what they paid for it.

The way I view it is if you are prepared to own the consequences of your actions, then by all means pay whatever you want for the house. Overpay needlessly? Sure, if you love the house, want to stay for a long time and aren't worried about resale, or if money isn't much of a problem for you, then go for it.

Sometimes I wish I could afford to grossly overpay on a house that I really like, but that's not in the cards for me.

[msRB311]

Why would you really want to grossly overpay for anything? I would just move on to a better house I guess.

[yesmaybe]

Originally Posted by msrb311

why would you really want to grossly overpay for anything? I would just move on to a better house i guess.

FOMO

I don't get it either but that's what people do.

[Iced_Coffee]

Originally Posted by msRB311

Why would you really want to grossly overpay for anything? I would just move on to a better house I guess.

No, what I said was I wish I could afford to.

Of course nobody wants to pay more than they need to, but it would sure be nice to be able to not worry about budget so much.

[id77]

Originally Posted by msRB311

Why would you really want to grossly overpay for anything? I would just move on to a better house I guess.

One person's overpay is another person's fair price, and location is a huge wildcard. Houses can be renovated or replaced, but the location cannot. A home that may be appraised for $X may go for considerably more if there's a couple buyers who've been waiting a long time to live in that particular location.

Union Park/Louisburg Square are good examples of this. You can get a larger/nicer condo/home two blocks away for less than what you'll fork over to live on those two blocks, but those aren't "better" homes if the location is your number one priority. People "overpay" to live on those blocks because the location is worth more to some. To someone who just wants to live in the general area, they're not going to place the premium on those particular blocks and will be just fine paying less to live somewhere else nearby.