"My Home Won't Sell Because the Economy is Bad Right Now!!!"
Anyone in the real estate market who has recently spoken with a seller has probably heard those words. Some Realtors may even agree with their seller because more then likely the agent doesn't know any better. I am not one of those Realtors. In fact, when I hear, "the sky is falling", I cannot help but laugh.
Now before you write me off as an unsympathetic Realtor who will always praise the market, take a step back and listen to reality.
I work in the Summit, NJ market. Summit, like the rest of the country, has been going through a period of depreciation. Why this is so shocking to people still puzzles me because real estate is cyclical. It goes up, it comes down, and one day it will rise again. To expect anything different is insanity because homes are driven by the same theory of supply and demand that you would listen to in Economics 101.
So if Summit, NJ is going through the same downward trend as the rest of the country, why won't I agree that homes will not sell because of the economy? The economy is bad, is it not? Good questions I suppose, yet the answers are not as complex as you may have hoped. Look at the facts and not what the media, your co-workers, and the used car salesman are saying.
This means you need to study your local real estate market. When I pull up the Summit market and search for every sold home in 2008, I find an amazing statistic that you would not see if the economy was so bad that homes were not selling.
This amazing statistic is simply an original list (OLP) to sale price (SP) ratio over 100 percent.
Doesn't sound too amazing? Let us take a look at how important this statistic actually is.
Anyone who knows anything about real estate could tell you that a buyer would not pay over the asking price unless another buyer was competing for the same home. Since we also know that a buyer would never make an offer unless they perceived value, we can actually draw interesting conclusions.
Let's call this formula of OLP/SP the litmus test for whether a market is "good". In fact, before you condemn your local market I want you to do you and your sellers a favor.
Pull up every sold home in any given town for 2008. List each of these properties in descending order by original list to sale price ratio. By the way, I use original list to sale price ratio because this clearly proves the fact that pricing it right from the start will end most lucratively. Using the list price is a flawed system.
Ok, now that you have this list of sold homes, you should separate all of those homes which sold above 100%, those homes which sold between 90-99% and every home which sold 89% and lower. This will give you three groups. Find the average for every statistic in each of these groups and compare the stats. If this doesn't restore your faith in real estate and the market, I don't know what will.
Below is a copy of what this chart would look like for the town of Summit. In today's market, 31% of Summit homes sold over their original asking price. Yes, that is a fact!
Summit Solds 2008 - Oct 21,2008.pdf
I've been around long enough to know that skepticism will occur. Indeed, I've heard many sellers try to claim that the reason these homes are selling quickly and for over the asking price is because they were priced at ridiculous values to begin with. "Of course they will sell fast and over the asking price, anyone can sell for a fire sale".
Well wait just a second Mr. Skeptical Seller; take a look at the average final sale's price for the each of the three groups. Do you think that it might be more then coincidence that the group of sellers who priced their homes correctly averaged over $300,000 more then every other group?
I don't know about what the media is saying or what your stock broker claims, but as a Realtor I let the market tell me what the answer is. The market doesn't have an opinion. The market doesn't think. The market just acts and with each change of the market we can interpret what needs to be done to successfully yield a seller top dollar for their home. This is what we, as Realtors, are being paid to do.
Imagine if a doctor walked into room where the patient was claiming to have a broken arm and said, "You know what, broken arms are on the rise this year, we can skip the x-ray because I believe you that your arm is broken. Let's cast that arm and send you away to wait until it heals." You would probably think he is the most incompetent doctor of all time.
The reality of the situation is that many Realtors make much more money then doctors and yet it is common place for Realtors to cave in to sellers on price because they don't want to argue in fear of losing the listing. The market is our x-ray and misdiagnosing a seller's home can be as costly as misdiagnosing a patient's arm.
Read the market because you might be surprised how positive the trends could be. It will also make it difficult for a seller to blame the market when 1/3 of the market sold over the asking price. What this approach really does is shift blame from the market to the true problem, the price is too high.
Sincerely,
Michael PennisiBurgdorff ERAReal Estate Sales AssociateCell (908) 656-38582007 Burgdorff ERA Rising Star Award RecipientFor all of your real estate needs please visit:www.MichaelPennisi.com
Summit NJ Sold Homes - March 2008
Summit, NJ's real estate market offers a wide variety of homes for every price range. Where else can a first time buyer be able to afford buying into a town filled with multi-million dollar homes of distinction?
It is this variety that allowed Summit, NJ to become the diverse community so many buyers find desirable. It also remains a place filled with long time residents proud of the town they helped shape.
This ideal New York City commuter community truly offers an environment fit for all. The perfect expression of Summit's ability to capture individuals of all walks of life is seen through a given month's real estate statistics.
Every price range is accounted for and sells like a well oiled machine. I hope you find these sold property statistics to be beneficial. If you are interested in find a Summit, NJ home currently active on the market please visit my GSMLS page. Here you will gain free access to the Garden State Multiple Listing Service.
| Close Date | Address | Original List Price | List Price | Sales Price | LP/SP | DOM | Rooms | Beds | Baths | Style | |
| 3/3/2008 | 328 | MOUNTAIN AVE* | $ 2,245,000 | $ 2,165,000 | $ 2,025,000 | 90% | 160 | 16 | 7 | 5 | Colonial |
| 3/3/2008 | 103 | Park Avenue B-5 | $ 459,000 | $ 429,900 | $ 390,000 | 85% | 141 | 7 | 3 | 2 | TwnIntUn |
| 3/3/2008 | 45 | HUNTLEY RD* | $ 389,000 | $ 389,000 | $ 397,000 | 102% | 7 | 7 | 3 | 1 | Ranch |
| 3/8/2008 | 67-75 | New England Avenue | $ 489,000 | $ 489,000 | $ 489,000 | 100% | 16 | 6 | 2 | 2 | TwnEndUn |
| 3/10/2008 | 28 | MONTROSE AVE* | $ 995,000 | $ 995,000 | $ 945,000 | 95% | 141 | 9 | 4 | 2 | Colonial,Custom |
| 3/10/2008 | 129 | Broad Street | $ 425,000 | $ 425,000 | $ 435,000 | 102% | 18 | 5 | 3 | 2 | Colonial |
| 3/12/2008 | 28 | Milton Avenue | $ 489,000 | $ 489,000 | $ 467,000 | 96% | 45 | 8 | 3 | 1 | SplitLev |
| 3/13/2008 | 25 | GLEN OAKS AVENUE | $ 1,049,000 | $ 1,049,000 | $ 999,999 | 95% | 16 | 11 | 5 | 3 | Colonial |
| 3/14/2008 | 11 | HILLVIEW TERRACE | $ 1,500,000 | $ 1,500,000 | $ 1,425,000 | 95% | 28 | 8 | 4 | 2 | Colonial |
| 3/14/2008 | 37 | Fairview Avenue | $ 729,000 | $ 699,000 | $ 660,000 | 91% | 37 | 8 | 3 | 1 | Colonial |
| 3/17/2008 | 43 | TANGLEWOOD DR* | $ 1,269,000 | $ 1,269,000 | $ 1,200,000 | 95% | 39 | 10 | 5 | 3 | Colonial,SplitLev |
| 3/25/2008 | 76 | New England Ave | $ 405,000 | $ 405,000 | $ 405,000 | 100% | 16 | 5 | 2 | 1 | TwnEndUn |
| 3/26/2008 | 35 | EDISON DR* | $ 459,000 | $ 399,900 | $ 390,000 | 85% | 143 | 7 | 4 | 2 | CapeCod |
| 3/26/2008 | 232 | OAK RIDGE AVE* | $ 2,795,000 | $ 2,795,000 | $ 2,650,000 | 95% | 19 | 14 | 5 | 5 | Tudor |
| 3/28/2008 | 777 | Springfield Avenue | $ 399,000 | $ 399,000 | $ 375,000 | 94% | 114 | 5 | 2 | 2 | TwnIntUn |
| 3/28/2008 | 241 | ASHLAND RD* | $ 645,900 | $ 645,900 | $ 625,000 | 97% | 86 | 9 | 3 | 3 | SplitLev |
| 3/31/2008 | 49 | Prospect Hill Avenue | $ 3,750,000 | $ 3,500,000 | $ 3,200,000 | 85% | 232 | 0 | 0 | 0 | SeeRem |
| 3/31/2008 | 26 | MOUNTAIN AVE* | $ 779,000 | $ 779,000 | $ 740,000 | 95% | 121 | 11 | 7 | 3 | Victrian |
| 3/31/2008 | 67-75 | New England Avenue, 73A | $ 489,000 | $ 489,000 | $ 489,000 | 100% | 160 | 6 | 2 | 2 | TwnEndUn |
| 3/31/2008 | 145 | Ashland Road | $ 769,000 | $ 769,000 | $ 747,000 | 97% | 115 | 9 | 3 | 2 | Tudor |
| 3/31/2008 | 9 | Bedford Road | $ 1,025,000 | $ 1,025,000 | $ 985,000 | 96% | 20 | 10 | 4 | 2 | Colonial |
Sincerely,
Michael Pennisi
908.656.3858
Interested in Learning More about Real Estate - Click Below
Summit NJ Sold Homes - February 2008
It is this variety that allowed Summit, NJ to become the diverse community so many buyers find desirable. It also remains a place filled with long time residents proud of the town they helped shape.
This ideal New York City commuter community truly offers an environment fit for all. The perfect expression of Summit's ability to capture individuals of all walks of life is seen through a given month's real estate statistics.
Every price range is accounted for and sells like a well oiled machine. I hope you find these sold property statistics to be beneficial. If you are interested in find a Summit, NJ home currently active on the market please visit my GSMLS page. Here you will gain free access to the Garden State Multiple Listing Service.
| Close Date | Address | Original List Price | List Price | Sales Price | LP/SP | DOM | Rooms | Beds | Baths | Style | |
| 2/1/2008 | 180 | Canoe Brook Parkway | $ 795,000 | $ 774,000 | $ 755,250 | 95% | 98 | 6 | 3 | 2 | Colonial |
| 2/4/2008 | 67-75 | New England Avenue | $ 489,000 | $ 489,000 | $ 465,000 | 95% | 15 | 6 | 2 | 2 | TwnEndUn |
| 2/8/2008 | 20 | RUTHVEN PL* | $ 1,245,000 | $ 1,195,000 | $ 1,150,000 | 92% | 98 | 9 | 5 | 3 | Colonial,Victrian |
| 2/12/2008 | 417 | MORRIS AVE UNIT 38 | $ 369,000 | $ 349,000 | $ 342,000 | 93% | 177 | 5 | 2 | 1 | TwnIntUn |
| 2/14/2008 | 18 | Druid Hill Road | $ 1,399,000 | $ 1,399,000 | $ 1,327,000 | 95% | 0 | 11 | 5 | 3 | Colonial |
| 2/15/2008 | 144 | Kent Place Blvd | $ 1,549,000 | $ 1,399,000 | $ 1,267,500 | 82% | 184 | 15 | 8 | 5 | Colonial |
| 2/15/2008 | 235 | ASHLAND RD* | $ 509,000 | $ 509,000 | $ 480,000 | 94% | 0 | 5 | 2 | 2 | CapeCod |
| 2/19/2008 | 67-75 | New England Avenue, 75E | $ 899,000 | $ 749,000 | $ 720,000 | 80% | 313 | 8 | 3 | 3 | OneFloor,FirstFlr |
| 2/27/2008 | 133 | Summit Avenue Unit #39 | $ 365,000 | $ 339,000 | $ 330,000 | 90% | 94 | 4 | 2 | 1 | OneFloor |
| 2/29/2008 | 10 | LEWIS AVE* | $ 469,000 | $ 449,000 | $ 430,000 | 92% | 120 | 7 | 2 | 2 | Colonial |
| 2/29/2008 | 281 | Kent Place Boulevard | $ 475,000 | $ 475,000 | $ 505,000 | 106% | 12 | 6 | 3 | 1 | Colonial |
Sincerely,
Michael Pennisi
908.656.3858
Interested in Learning More about Real Estate - Click Below
Real Estate and Politics - How the Game is Played
Realtors like politicians are faced with limitless possibility. I realize limitless may seem extreme, yet what other career fields can offer a one time soccer mom the ability to grow a multi-million dollar business in a few years time. No disrespect to soccer moms because that is an accomplishment for any individual; educated, experienced, or not.
The fact of the matter is simple; real estate offers competent people the ability to live up to their potential. Now although you may not feel all politicians are competent, politics also offers everyday people the ability to make a difference.
The interesting aspect about both politics and real estate is that there is not one way to the top. Some politicians are corrupt and lie and cheat to get to the top. This is similar to some Realtors who put their own interests above that of the client. Then there are those politicians who remain morally incorruptible and still achieve great things just like there are those Realtors who do what is right for the client first and attain a good reputation. I guess the biggest question then becomes how do you play the game?
Before I continue to delve into my correlation between politics and real estate, I think it is important to understand what triggered this thinking. Last night I watched the Republican National Convention and listened as Vice President hopeful, Sarah Palin, gave her speech. Regardless of political affiliation, I feel certain that anyone watching could agree on the fact that she gave a powerful speech and nailed it. What I found interesting is how she was a self proclaimed "hockey mom" and gracefully rose into a position of power. Now she stands before our country as the next potential Vice President.
To me this is symbolic of our great nation and the opportunity we are given daily. What I also liked about her speech was her ability to "play" the game. Whether right or wrong, politicians are masters at telling people what they want to hear in order to gain support. Now don't get me wrong, I am not suggesting Sarah Palin is just talking without plans to back it up. In fact, I don't want to even express my feelings towards her politics because it is irrelevant to my writing this article. The important part is that I watched a woman who stands for what she feels is right become a force in today's politics.
Now that I have explained the political setting, I need to talk about my real estate mind state. In the past eighteen months, I have lost nine listings due to my price being lower then the sellers wanted to hear. I cannot tell you how frustrating this becomes because in eight of the nine instances the sellers eventually sold lower then the price I gave them after sitting on the market for months and months. The only remaining home, of the nine, was actually a listing I lost last week and will undoubtedly sit due to overpricing.
With all of this being said I have come to the conclusion that I am a good Realtor but a really bad politician. Haha.
I feel as though I am terrible at playing the game because playing the game directly contradicts what I believe to be the right thing to do. What I mean is that I could easily have gone into these nine listings with an inflated number and walked out with a signed listing. Once that listing is signed I could then string my sellers along until they get frustrated and eventually drop the price to the point that the property sells. Then I can walk to the bank and cash my check. Instead I watch other Realtors do exactly that and walk away with a pot of gold. What am I left with then? Simple, I'm left with frustration and aggravation.
The sad part is I know how to price a home to sell. I know how to study a market better then most agents out there. I also have studied my market long enough to know that homes priced slightly under the market will sell quickly and sell higher. Those homes priced high will sit and the sellers not only get frustrated but will inevitably sell for a much lower price. I not only know this, but I can prove it with countless real life examples.
And now for the kicker; not only do I know all this, but I'm honest enough to be real with sellers about price. I risk thousands of dollars every listing presentation I go on because I know that correct pricing is best for the client.
The worst part about all of this is that sellers don't care. Sellers hear what they want to hear and get greedy. Even if it means losing thousands of dollars in the long run they will take that risk and sign with a less competent agent willing to list their home for more.
What's truly scary is that these same principles apply to politics. There are politicians out there that throw around grand ideas without the substance to back them up. Whether democrat or republican there are many people that get caught up in the games these politicians play with words rather then the integrity of the individual or even the plan they hope to act out.
It's crazy but our society has created a system where it pays to tell people what they want to hear rather then what they need to hear. The unfortunate reality is that by setting the standards higher in theory, people will accept it as reality, even without the facts to substantiate the theory.
The problem I have is that I disagree with the game because I care about the clients I serve. I want to give them the benefit of the doubt and ensure that they obtain top dollar for their home. It disappoints me to hear that I was the best candidate for the job, yet was not selected because someone else lied to win.
If nothing else, I think this coming Presidential election and my recent real estate disappointments have taught me a valuable lesson. I always wondered why politicians would say one thing and act out another, yet real estate has taught me that this is a very successful strategy in gaining a vote of approval. This is a very difficult lesson to learn and would probably change the outlook of most individuals. Fortunately, I refuse to allow this world of politics and real estate effect my integrity as a person. If anything this experience has taught me to grow thicker skin and not allow those who choose not to be saved from affecting how I conduct my business. Thankfully, the disappointments in those nine instances have been drowned out by my many positive real estate achievements. It all comes out in the wash and even those people who did not select me know that my advice was accurate to begin with.
I keep in mind that real estate, like politics, is all about public sentiment. If you continue to hurt your clients they will not continue to support you and eventually it will take its toll on your career. The reverse is also true because if you continue to do what is right, people will begin to recognize your expertise and value your input.
So how do you play the game? How do you interpret what you are being told? Do you listen to the facts or is it politics as usual?
Sincerely,
Michael Pennisi
908.656.3858
Interested in Learning More about Real Estate - Click Below
What is it about Summit, NJ that makes it so desirable?
If you are asking this question, then you probably do not live in Summit.
Summit, New Jersey is far from a cookie cutter town. It consists of remarkable architecture, beautiful landscapes, and old world charm with historical relevance. Although each of these aspects is true and sounds attractive, reality suggests that today's buyers need more from a town.
What do today's home buyers need?
In my experience, buyers are looking for a number of things from the place they decide to choose.
Thankfully, Summit, NJ appeals to each of these buyers. It is no wonder Summit homes are still selling quickly in this "terrible" real estate market. Next time the media claims the sky is falling, think of Summit as the umbrella.
To better serve those of you interested in learning more about Summit NJ, I have continued to update my website's Summit page.
Most recently, I have added a complete community report and the 2007 year-end broker statistics for homes sold in Summit, NJ. Also if you have not yet read my "Summit, NJ 2006-2007 Real Estate Analysis" I suggest you do so. The information is completely unique from anything else you will see online.
In the near future, you can expect to find virtual tours of the Summit area. I know that many of my clients and readers are from out of the area and may be interested in seeing what Summit has to offer. Since a picture says a thousand words, I plan on providing you with a visual journey into Summit, NJ real estate. I will make sure to update you as soon as this addition is complete.
Until then, enjoy the recent improvements. If you have any questions or comments, feel free to contact me. I look forward to speaking with you. Have a great day.
Again click here for the link to Summit, NJ
Sincerely,
Michael Pennisi
908.656.3858
Interested in Learning More about the Summit, NJ Area - Click Below
I am a full-time Realtor who specializes in the needs of my clients. I consistently net my sellers top dollar in the shortest amount of time. My buyers are well educated and always aware of new homes.
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