Sometimes in real estate we get too wrapped up in quantity. We tend to measure ourselves by the number of closings or the volume of sales that we have in a year. As a home or condo seller, your concerns are more about quality. For example, when you hire your listing agent, how do you know you're getting a good one? Fortunately there are 3 simple measures that will help you answer this question.
A listing can either sell or it can expire. This simple measure identifies the percentage of an agent's listings that actually sell. We calculated the listing success rate for the entire South Central WI MLS on May 17th and found that the average listing success rate in 2016 is 68%. From January 1st through May 17th, 68% of all completed listings sold. The remaining 32% expired. If you're in the process of hiring a listing agent, we recommend hiring one whose success rate is 85% or greater.
Measure #2: Days on Market
The days on market statistic measures the number of days that elapse from the listing date until the accepted offer date. Our review of the 2016 data shows the average days on market across the entire MLS is 88 days. We recommend hiring an agent whose average is one month or less. That's because listings that sell quickly tend to sell for a high market price. Listings that sit on the market can become stale and sell for a much lower market price.
Measure #3: Sold Price % of Original List
Agents with a high average days on market tend to sell their listings for well below the original list price. That's because listings that have been on the market for a long time tend to go stale after undergoing one or more price reductions. Our review of the data shows the average MLS listing sells for 94.6% of the original list price.. We recommend selecting an agent whose sold to original list price ratio is 97% or higher.
More Ways to Evaluate a Listing Agent
There are other ways to evaluate a listing agent which have nothing to do with data at all. One quick way to evaluate a listing agent is to apply the "eye test" to the agent's current and recent listings. When you review the agent's listings, look for evidence of professional staging, professional photos, and professional video. Check for listing remarks that truly sell the advantages of each property. Also look for supplemental marketing materials that outline the features and improvements of each home.
Another important step is to interview the agent's current and recent clients. Ask questions that center on communication, customer service, market expertise, follow through, negotiation, and advocacy.
Yet another important step is to ask the agent you're interviewing a few important questions. We'll cover these interview questions in a future post.
Are you currently interviewing listings agents? We'd love to learn more about your goals. Contact us for a complimentary consultation that will help you start moving forward in a positive direction.
This article is published courtesy of: Dan Miller, REALTOR Mad City Dream Homes & RE/MAX Preferred