There are three factors that determine if you can sell over asking price.
Are properties still selling for over the asking price? The short answer is yes; properties are still selling for over the asking price. Just recently, a property went into escrow at $250,000 over the asking price, while two other properties sold for $300,000 and $500,000 over the asking price.
However, it is important to note that this does not apply to all properties. There are definitely fewer properties selling over the asking price now than a year ago at the height of the market. So, what determines whether a property will sell over the asking price? There are three things to consider:
1. Inventory. How many options do buyers have? What is the supply of properties in that micro-market? Micro-markets can be defined by the city, school district, neighborhood, or price point.
“Properties are still selling for over the asking price, but it depends on the micro-market.”
2. Demand. How many properties in that market are in escrow, backup status, or pending? This tells us how many buyers are absorbing those properties.
3. Past sales. We take a look at how many homes similar to the property sold in the last three months. This helps us determine how many houses in the market are absorbing every month, which will tell us how much inventory we have and how many months of inventory we have. Historically, when we hit six months of inventory, it shifts into a strong buyer market. Currently, some areas only have a month’s worth of inventory, meaning that if no other properties came on the market, it would only take a month for all the properties to get absorbed by the buyers. This means there is high demand and not many options for buyers to choose from.
Properties are still selling for over the asking price, but it depends on the micro-market. If you have any questions or concerns about how the market would respond to your property, feel free to call or email me. I’d love to hear from you.