A common measure used in real estate is Sales Price (SP) divided by the Original Sales Price (OSP), or SP/OLP%. It is relative.
Agents may tout their expertise by providing their numbers; i.e. an agent with a 98% SP/OLP is “better” than another with only a 95% SP/OLP.
One has to be careful in using percentages to evaluate agent performance because there are many variables involved. In the example below, Agent A starts with a lower price of $900,000 and has a higher SP/OLP% than Agent B, but Agent B sells the property at a higher price.
Agent A: SP $882,000 / OLP $900,000 = 98%
Agent B: SP $902,500 / OLP $950,000 = 95%
In the real world it is impossible to know which is the better agent based solely on the stats. Is there such a thing as a property being under priced, or overpriced? The respective answers are maybe “No”, and absolutely “Yes”.
A stat that is absolute is Days On Market (DOM). Properties priced right go under contract much faster than properties that are over priced. Here is the evidence.
For single family detached properties Sold in East Cobb during the 4Q16:
- Listed for the first time without price changes averaged 9 DOM.
- Listed for the first time with price change(s) averaged 65 DOM.
- Previously listed with price change(s) averaged 168 DOM.
DOM can take a toll on the Seller, emotionally and financially with the added holding cost. There is a delicate balance to be achieved between a seller’s net at closing and days on market.As you can see, selling “for top dollar” does not tell the whole story.
We welcome invitations to meet in person, and always appreciate the generosity of a prospective client to give of their time to hear about our approach to selling higher value property. And visit our website for more information about Hiring The Right Agent.