I can always depend on my friend Bill Wendel to have a new and radical perspective on anything that has to do with the real estate consumer. His post on expired listings made me wonder why expired and withdrawn listng numbers are not reported in the media. If stats like pending sales (vs. actual sales, I guess) can make real estate headlines, why not also use expired, canceled and withdrawn listings, let’s call them FAILED listings as Ardell Of Rain City Guide does in her posts on the impact of failed listings on the overall real estate market.
The graph above shows the number of sold listings vs. the number of failed listings for the entire Memphis area for 2009 up through 12/29.
But where do the failed listings g0? Looking at the graph, the number of failed sales, equaled or exceeded the number of completed sales in the above $200,000 price range. Sure, some of these owners renewed their listings, re-listed with another agent, or maybe even tried the for sale by owner route. This may look normal under static conditions, but new listings are being added to the mix every day. If the failed listings just went away, everything would look dandy for the market, but they are out there somewhere.
Here are the numbers that generated the graph:
Let’s look at the at the $300,000-500,ooo price range.  853 properties sold, 844 current listings, and 1104 Fails. Even if all those completed sales had, at one time- which seems highly unlikely, been classified as Fails, that still leaves 251 properties unaccounted for, unless we roll that figure to current listings. So we know we have the shadow market of the properties that the banks have already foreclosed but are not putting on the market, but what’s to be said of the failed listings, and how do we know what their status is in the overall market?
Also, the spreadsheet shows the absorption rate, based on months supply. 6 and below indicates a strong seller’s market. Above 6 months favors buyers. Since there are so many more properties priced below $200,000 the average rate for the overall market would be skewed downward, but, bottom line, if you are on the market with $Million property, there is a 3.5 year supply to compete with. Prediction for 2010:  The shadow market will lead to continued decreasing sales prices in most areas.
Once again as I always say, all markets are micro. Drill the stats down for your area and price range to the smallest, closest, and most comparable areas to see where you really stand in this market.
For an interview to anlyze your Memphis property’s marketability, and to review my Web 2.0 marketing tools call for an interview at 901-214-5563. Sometimes listing your property is not to best course of action. Let’s talk.
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Joe,
Need to reread this after a second cup of coffee this morning, might take me a week to deconstruct all those numbers in your post and compare them to Massachusetts. I’d like to share your analysis with fellow real estate consumer advocates around the country, and see what the “failed” listings ratio is in their markets. For years, I know that Erle Rawlins has monitored similar stats in Dallas and calculated something he calls the “shrinkage rates.”
Thanks for the link to Ardell, and please let readers know if hear any other “buzz” about expired and canceled listings in other markets. When the shadow market exceeds the number of MLS listings, can’t help but think that will have a transforming effect on the homebuying / selling process. More thoughts to come, and maybe a conference call for others interested in the topic?
Bill Wendel
Real Estate Cafe
617-661-4046
Bill, Ardell did a few posts on #fail listings starting 12/24. I am afraid that my post doesn’t answer my own questions. While I can pull lots of stats from the MLS, I can’t figure out how to get the “re-absorption rate” for #fail listings. What happens to the Fails after they fail is the critical metric, and I can’t get to that without pulling individual property MLS histories.
If you or anyone have any ideas on #Fail re-absorption, I think it would make for an interesting discussion.
Bill, Ardell did a few posts on #fail listings starting 12/24. I am afraid that my post doesn’t answer my own questions. While I can pull lots of stats from the MLS, I can’t figure out how to get the “re-absorption rate” for #fail listings. What happens to the Fails after they fail is the critical metric, and I can’t get to that without pulling individual property MLS histories.
If you or anyone have any ideas on #Fail re-absorption, I think it would make for an interesting discussion.
Joe,
Need to reread this after a second cup of coffee this morning, might take me a week to deconstruct all those numbers in your post and compare them to Massachusetts. I’d like to share your analysis with fellow real estate consumer advocates around the country, and see what the “failed” listings ratio is in their markets. For years, I know that Erle Rawlins has monitored similar stats in Dallas and calculated something he calls the “shrinkage rates.”
Thanks for the link to Ardell, and please let readers know if hear any other “buzz” about expired and canceled listings in other markets. When the shadow market exceeds the number of MLS listings, can’t help but think that will have a transforming effect on the homebuying / selling process. More thoughts to come, and maybe a conference call for others interested in the topic?
Bill Wendel
Real Estate Cafe
617-661-4046