bubbleinfo.com

The latest spin on the market is that it’s ‘getting back to normal’.

The last eight years of real estate boom, combined with the internet, has changed everything forever, and we’re not going back to ‘normal’, unless you’re moving to Illinois.

(Normal, IL, population 50,485)

When I started selling real estate in 1984, we received our MLS books every Friday - detached homes one week, attached the next.  Plus, the agents had a tight grip on the information - if you wanted to know what was for sale, you had to go through an agent.  Because of these two facts, you could probably say that the slower dissemination of the market data was the reason it took longer to sell.

You can’t say that now, the data is available to everyone in an instant.

As a result, agents and buyers alike watch the ‘days on market’ as the first indicator of value.  If the property has been on the market for longer than 30 days, buyers figure that it’s overpriced, and move on to the newer, fresher listings.  Even with price reductions, it’s hard to recapture the urgency and enthusiasm created by a fresh listing.

That’s why the ‘days on market’ statistic is the most manipulated number on the MLS.  Listing agents regularly ‘re-fresh’ their listings by cancelling the old one and re-inputting it as new, hoping to fool those who don’t check the listing history.

What does the longer average market time really mean?

It means that sellers (and agents) are TAKING LONGER TO GET THE PRICE RIGHT. 

In other words, TO GET THE PRICE LOW ENOUGH.

I have yet to hear anyone explain what they mean when they say ‘back to normal’.  It’s being used as some vague, general term – I’d love to see somebody explain it logically, and have facts to back it up.