Knoxville Tennessee Real Estate Blog

It’s been listed for 90 days now and not even one showing. What’s the problem?

The number 1 reason I see for homes not selling is most often the price (this could also be reasons 2,3,4 and 5).

It’s a tough new market out there folks; mortgages are tough to get these days, buyers are taking MUCH longer to make decisions about which house to even make an offer on, and the economy is in a shambles with high unemployment.

Even if the recent comparable sales and price points in your area and neighborhood support your asking price your house could still be overpriced relative to the market right now because that’s the market buyers are buying in.

Just because you refinanced last year or even 6 months ago, and got an appraisal equal to or higher than your current asking price, the market right now may be lower than those figures.

Generally the higher up you go on asking price the longer the time on the market becomes. Because of the credit crunch especially on jumbo or non conforming loans (in the Knoxville area that would be a loan over $417,000), large mortgages are even tougher to get than say an FHA loan on a median priced 3 bedroom house in the Knoxville area.

Below is a chart showing the absorption rates (months to sell) for price points in the Knoxville, Tennessee market.

Knox County, TN absorption rates for homes

The above graph shows that if your home is listed for sale for over 1 million dollars there is currently a 42 month supply of those homes at the current sales rates. Listed between $100,000 to $150,000 there is a 9 month supply of homes in that price point.

So what’s the answer? Have your agent update your market analysis. Take a look at homes that have sold in your neighborhood, your zip code, and similar homes in other parts of town. What is their list price to sale price ratio? Did those sellers make any concessions to the buyer, i.e. pay some of their closing costs, install new carpet, and any other inducements to get them to buy that house.

If they did maybe that’s something you should consider to get yours sold too but most often it’s the price.

Reason number 2: CONDITION Does your home show like a model home? Has it been “staged” to show in the best possible light to new buyers? Decluttered with overstuffed closets leaned out, excess ‘stuff’ packed up and out of the way? CLEAN, with everything including windows, front door, kitchen and bathrooms squeaky clean? Visit my website, www.KnoxvilleHomeCenter.com and click the “Selling” link to get my 40 Free or inexpensive tips can make your home show better, sell faster, and put more money in your pocket at closing.

The better your house shows the more buyers are willing to pay and the quicker it usually sells.

Reason number 3: LOCATION Ok, if this is your problem immediately call Acme House Movers and………of course I’m just joking here but one of the cold hard facts of life are that some locations are more desirable than others and others are less desirable.

If you’re in a location buyers seem to perceive as less desirable for whatever reason the only cure for that condition is to reduce your asking price.

You may enjoy living next to the railroad tracks and look forward to that 100 car coal train that comes by at 3:00 AM every morning but trust me, the average buyer won’t share your passion for railroading that up close and personal.

Reason number 4: ACCESSIBILITY You can’t sell it if buyers can see it. Showings are often requested on short, or sometimes no notice. As a serious seller you need to make your best effort to keep your home in showable condition at all times.  I’m continually amazed as I search through the Multiple Listing Service (MLS) looking for homes for my buyer clients and find agent notes like: “24 hour notice to show, no exceptions”, “no lockbox, listing agent must be present for all showings” (so what if the listing agent is not available?, and this favorite, “DO NOT GO IN YARD, dogs will bite”

So if I have a buyer that wants to see your house in 2 hours you want them to wait until tomorrow, hope your agent can let us in, and run the risk of being attacked by your darling pit bulls? Guess what, that’s not happening, there are hundreds of other houses for sale that we can see on our schedule and buy today. Which of those options would be best for you Mr. Seller?

Reason number 5: YOUR AGENT Yep, this could be one of your problems.

Even though all Knoxville area Realtors pay the same amount of dues some of them are frankly just better at marketing homes than others. So the first thing you should do is review your agent’s written marketing plan of what they’re going to do to get your house sold. Oh, you asked for their written marketing plan and got that ‘deer in the headlights’ look. Ooops, that could be a problem.

National Association of Realtors statistics show that over 85% of current homebuyers started their home search on the Internet so how is your homes Internet marketing presence? Does it have a virtual tour? Is your home displayed on multiple websites like Realtor.com, Zillow, Trulia, Yahoo, GoogleBase, BirdView, Vast, Homes.com, YouTube (yep, videos), and other websites including your agent’s personal website? If not that could be a problem.

Does your MLS and advertising descriptions paint a pleasing visual picture in a buyer’s mind or does it just say something like: “3 BR, 2 BA, darling, hurry, won’t last long”? Have you ever seen your homes MLS listing? If not that could be a problem.

Does your listing have a minimum of 20, well made and current photos of your house including the interior. Amazingly there are still photos in the Knoxville MLS of homes for sale with snow on the ground. When was our last snow? Buyers like to see lots of photos and if you don’t have them…….that could be a problem.

So here’ s the 5 reasons roundup:

1. Revisit your list price objectively and look at the most recent sales. If it’s not selling then adjust your price.
   
2. Go outside and walk through your house pretending you’re a buyer. Do you like what you see? Showroom condition is key.
   
3. Have a talk with your self about your homes location.
   
4. Make sure potential buyers can get in to see your home and feel safe and welcome while they’re there.
   
5. And finally, call your agent up and invite them over for a visit and review of what’s been done to market your house and what will be done in the future.

Visit KnoxvilleHomeCenter.com for lots of great selling tips, no charge, no obligation.

Please feel free to call, comment, or email any questions.

knoxville tn real estate listings

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October……..in east Tennessee the air is turning crisp and cool, the leaves are starting to turn to their fall colors, and real estate sales are in the air.

So what does the first week in October bring to Knoxville real estate news?

It looks like the average number of sales is still average; we had 152 closed real estate transactions reported by the Knox County Register of Deeds, here’s the price points breakdown:

Knox County, TN real estate transactions recorded

And as usual the lower pric points continue to dominate the sales figures. 35 in the $100,000 to $150,000 price ranges was the top number with 2 in the over $1,000,000 price range.

And if you compare an average week of sales to the absorption rates (how long it takes houses to sell) you’ll see the price point points above go hand in hand with sales.

Knoxville, TN home sales by price points and months to sell

And the year to date sales figures compared to the past 4 years

Knoxville real estate sales year to date compared to past years.

So which way are Knoxville area sales headed? My guess is down for few months until January-February 2010 when they have historically started their seasonal climb to the peaks in May-June.

Even though sales this year around 50% less than 2005-6 the sales trend still mirrors the peak years sales; there is just far fewer sales.

The $8,000 federal tax credit expires at the end of November this year and I believe that carrot has accounted for about 20-30% of our sales this year. If buyers want to have a chance of collecting that eight thousand bucks they need to plan on having a house under contract in the next 1-2 weeks. After there your odds of closing before the end of November are going to go way down.

There is talk and much action from real estate entities like the National Association of Realtors to extend the credit to keep sales going but what’s going to happen there is anybody’s guess.

Bottom line, if you want to buy a house, now is a great time if you have a stable job and can qualify for a mortgage. Interest rates are in the low 5 to high 4% range, you still might be able to collect $8,000 in tax credits if you buy soon, and there is a huge selection of homes for sale.

KnoxvilleHomeCenter.com is a great place to start you search as well as find school information, and lots of other Knoxville area information.

Please call or comment with any questions.

Knoxville, TN real estate

If you’re selling or thinking of selling a house in the Knoxville and Farragut, Tennessee area one important fact you must know is what is the current absorption rate in those areas for your price point.

Absorption rate is simply the time it will take a house to sell based on the number of current listings and the monthly number of sales in those price points.

A “normal” Knoxville real estate market usually has an absorption rate of 6 months and neither the Seller nor the Buyer is thought to have the advantage. A Seller’s market usually has an absorption rate of less than 6 months, and a Buyer’s market normally is thought to have an absorption rate of more than 6 months.

The 6 month number in this definition means it would take about 6 months to sell the entire amount of available Knox County inventory in the market if this were a so-called normal real estate market.

Currently in the greater Knoxville area it’s pretty long for the higher end of the market and getting closer to average in the lower end.

Remember:

Sellers market equals less than a 6 month supply of homes for sale

‘Normal’ market has a 6 month supply, give or take 2 weeks each way

Buyers market has more than a 6 month supply of homes currently for sale.

Knox County absorption rates (months to sell)

Spun any way you want, almost all of Knox County is still in a pretty strong buyers market with the upper end price points being a VERY strong buyers market, i.e. there is a 42 months supply currently for sale of homes priced at over 1 million dollars, and a 35 months supply priced between $300,000 to $500,000.

The figures above are why the $200,000 and below price points continue to dominate the sales charts and have all of this year.

Buyers, it’s still a great time to buy. Lots of Knoxville area homes for sale, low interest rates, and you can still get in on that $8,000 federal tax credit if you qualify. Call or mail me with any questions about how you can very easily become a homeowner in 2009.

Sellers, homes in Knox County are selling but they need to be priced very aggressively, in tip top condition, and you need to be willing to negotiate with buyers if you want to sell.

Visit KnoxvilleHomeCenter.com to see all of Knox County and the surrounding areas homes for sale.