Dignowity Hill Real Estate - How close is the selling price to the listing price and how much does a house listed for $400,000 typically sell for?
This week I decided to investigate is the current Sale Price to List Price ratio (SP/LP) because lately, I’m finding that sellers are wanting to list properties for unreasonably high prices - not only in Dignowity Hill but in other parts of San Antonio as well and of course listing too high at the beginning can lead to a much longer time on the market, price drops, and a listing going “stale” - none of which are good for sellers.
Graphs are a good way to visualize patterns, make better predictions and better decisions so let’s take a look at the SP/LP ratio for Dignowity Hill from 2009 to 2019. The data includes homes built before 1940 and we’ll leave new construction for another set of graphs. The data I used includes homes that have been rehabbed and homes that have not.
It’s pretty clear that for the past few years, the ratio seems to have stabilized right around 91%, which means for example that a house originally listed for $399,900 will typically sell for about $363,000 and a house originally listed for $299,900 will typically sell for about $272,000. Not every house will follow this pattern of course but at least this gives us an idea of how it all shakes out. The r-sq value in the top right corner tells you that the red curve representing our model fits the data very well. That curve comes with an equation (not shown here), and I could “plug in” values (for example 2020 or 2021) and the result would be the predicted SP/LP ratio for those years, but this graph is pretty clear and I’m sure you can all come up with the ratio for 2020 or 2021 without actually going through the calculations.