Jon Griffith, Certified Short Sale Negotiator

As of now, we have a total of 43,705 single family detached homes on the market.  Our total number of residential listings is at 52,542.  A total of 1053 properties sold between August 18th and August 24th 2008, which was down from the 1200 that sold the previous week.

The average asking price for this week was $409,037 while the average sales price was $238,943 which was a slight increase over the previous week.  It’s time for the market to correct.  Prices over the next 12 months are expected to increase gradually, but not at the rate that we would normally expect of our real estate economy.

We’re currently

at an average of 112 days on market with roughly 9 1/5 months supply of inventory overall.

Sampling of a North Phoenix neighborhood sales history.

It’s hard to say whether or not our market is continuing to correct. I have updated my Market Statistics page this evening and as you can see from the graph below, we are at 2004 pricing. Draw a line from 2001 to our current average sales price today and you’ll see that we’re where we should be. The unrealistic gains are still falling off in certain market areas and people who sell now are still profiting, albeit not nearly as much as they could have.

If you’ll recall, everyone kept saying, “where would you go,” when asked if they should sell back in 2005. Not many people saw that we’d fall back to where we were in 2004. My question for the masses is whether or not we’re going to see an over correction, pushing prices into the 2003 range.

Every day I have the opportunity to meet people, to present my ideas, and to be successful.  Every day I also have the opportunity to fall victim to what many of us do when we have a vision for something great.  We wait for perfection.  A perfect website, a perfect presentation, a perfect, a perfect, a perfect.

Not going to happen.

The word perfect has been defined in many ways, but for the most part, the common understanding of perfect indicates absolute conformity with a standard or ideal, unimprovable, accurate or correct in every detail, etc.  It’s just impossible to be perfect.

I supposed one can expect to be perfectly imperfect in everything they do, which is why waiting around for that perfect performance, the perfect document, the perfect way to say something is only going to keep you from experiencing failure, which is what forces you to improve.  Without failure, you become stagnant, and without input from others, you’ll miss growth opportunities.

If you are on the cusp of a breakthrough but aren’t able to make that next step towards success, ask yourself if you’re holding out for perfection.  If you are, throw it aside and just take the leap of faith.

Whatever it is you’re working towards, you must expect to fall short from time to time.  Surround yourself with people who understand this, practice this, and can offer you constructive criticism to help you get better at whatever it is you fearlessly attempted to do, imperfectly.

Know what the statistics represent before making a decision.

Statistics help us know what happened so we might prepare for what could happen based on the patterns we’ve observed.  It is very easy to manipulate statistics to show results that will help us gain your trust and confidence.  One of the statistics that I’ve been looking at in the Valley is the percentage of sold price versus asking price.

When a home receives an offer, those of us who think statistically and mathematically will quickly determine what the percentage of the asking price the offer represents.  On a home that is listed for $300,000, if someone offers $285,000 they have submitted a 95% offer.  This information can be very useful for the buyer to determine what to offer the seller.  If the buyer were to look at this from the percentage angle as opposed to the dollar amount, and they were willing to put in a 90% offer, we’d know that their offer is going to be $270,000.  What the seller does at this point is up to the seller, but that’s not the point of this article.

With thousands of sales every month, it is becoming easier for us to compare your property to the rest of the market.  One of the comparisons we look at is the sold price to asking price, which helps our sellers understand what to expect when they receive an offer.  What has often been overlooked is the percentage result we obtain by determining the sold price versus the original asking price.  Most reports that we run are defaulted to show the list price at the time of sale, not the list price at the time the property was listed.

I conducted a simple comparison on 16 properties of a subdivision in the west valley that were all comparable properties.  In order to obtain enough results, I had to go back two years.  I compared the sold to list price of each property and then averaged the results.  What it showed was that on average, the properties that were selling in that neighborhood were selling for approximately 95.6% of their list price.

After calculating the percentage based on the original list price, which is the price for which the seller originally wanted to list their home,  the results showed that the sold price was actually  88.8% of the original list price.

Without conducting your own statistical analysis, it is difficult to understand what someone might be attempting to show you if they don’t disclose how they came up with their numbers.  On one hand, you could pitch to your buyer that it’s likely the seller will settle upon a price that is around 95% of the asking price.  Likewise, you could show a potential seller that their asking price is far too high and that they could expect on average to settle for 88% of their original asking price.

Make sure you know when you are presented with statistics what those statistics are actually measuring, and which statistics really matter to you.

As of the beginning of the week we had a total of 54,674 homes for sale, including all residential property types. By the end of the day on Sunday, our levels had dropped 1.6% to 53,767. The average asking price at the beginning of the week was $408,161 which increased less than one percent. Average days on market decreased by 5.1%.

1256 properties were sold over the past week which was 18.6% more than was sold the previous week. Word is getting out. It’s time to buy.

For properties that sold last week, the average asking price actually increased 2.83% over the previous from $241,098 to $247,941. The actual average SOLD price of the 1256 properties that sold last week was $237,968, 1.4% less than the previous week at $241,268. Those properties on average were on the market 116 days.