[This week, market analyst Jonathan Miller uses a couple of illustrative metrics to figure out whether buyers are leading sellers, or vice versa. The full rundown below. Click on the image to expand.]
I wanted to provide some historical perspective alongside the current market to show how negotiability (listing discount) and marketing time (days on market) are not (yet) at the point we saw in early 2003, early 2001 and even the late 1990's. It would appear that we have a little ways to go to reach those thresholds if the market weakens further.
Days on market = no. of days between last price change and contract date
Listing discount = % the final sales price is below the last list price change
The increase in supply of inventory should continue to press these indicators upward (weakness). With more choices, buyers are taking longer to make decisions and the increased days on market may influence sellers to be more negotiable or at least price their listings more realistically. Overall, buyers still don't have the upper hand in the transaction, but many think they already do.
· Listing Discount vs. Days on Market [Miller Samuel]