What Do Sold Listings Tell You?
Not much. It does depend on the age of the information. What is lost in the translation of reviewing past sold listings is an understanding of the circumstances at the time of sale. Often there are conditions that exist that impact the moment of sale that isn’t reflected when the numbers are studied at much later dates. I am referring to events like the sub-prime debackle and resulting implosion, significant events that impact our nation like New Orelean’s Katrena, Sept. 11, dollar devaluations, changes within the fed….Greenspan to Bernanke, interest rates, and inventory levels, etc., etc. Now much of this is remembered but the actual impact on the housing market isn’t always known when looking at historical sold listings.
What can be studied looking at sold listings are apparent incorrect list prices and the number of days needed for a sale. The market is meticulous, exacting, and ruthless about the price a property brings at closing time. There is no Mr. Nice guy….it’s all about value and what someone is willing to pay at that moment. Checking sold listings should reveal that its not prudent to mess with “mother market”…she has a mind of her own. Reviewing sold listings should hammer home the point that a buyer’s personal financial needs has nothing to do with what a property is worth on the open market. Thinking otherwise is mistake.
These revelations reviewing and studying sold listings may be more obvious to real estate professionals than buyers or sellers. Professionals in any industry tend to be less emotionally impacted by the informaion gleaned than the ultimate consumer. When the review of sold listings are digested in the right context taking into account the circumstances at that time this information can be somewhat helpful. The best advice is to review current information about current listings with an eye on current circumstances and estimate as best you can where real estate prices and value are going in the future. The rest is probably a waste of time. It’s all about today.
Joe Parsons
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