When planning to list their home, sellers often ask how much
of their asking price they can expect. One
place to start is to look at statistics detailing the average percent of list
price sellers in your zip code received during the past quarter. This is called
the average list-to-sale-price ratio, and though useful, it is just one factor
to consider when thinking about your list price and potential proceeds.
The Average List-to-Sale-Price Ratio
The average list-to-sale-price ratio aggregates all sales in an area during a specific period to generate the average percent of listing price buyers paid. It does not mean that all houses in that area sold for that percent of their asking price—some sold for more and some for less. For example, during the fourth quarter of 2019, the 19460 Phoenixville zip code had 137 sales and an average list-to-sale-price ratio of 96.4%. Some of the 137 homes sold for less than 96.4% of their asking price, and some sold for more.
The larger the number of sales in an area, the more meaningful the ratio. If a zip code had only a few sales during the past quarter, then the list-to-sale-price ratio is less useful than if the zip code had 75 or more sales.
Factors Affecting the Percent of Asking Price You Can Expect
Two of the biggest factors that affect whether you’ll sell for more or less than the average percent of list price received in your zip code are:
- How your home is priced
- The condition of your home.
Over the past ten years, we’ve seen an increase in buyers with little or no interest in houses that need updating. Houses with fresh paint, new flooring, an updated kitchen, and a well-tended yard are in high demand and tend to sell quickly and for a relatively high price. Sellers whose houses need updating and who do not plan any improvements before listing can expect a lower price and should price their house accordingly.
Houses in need of significant updating may sell for much less than sellers hoped. One reason is that so many buyers with work and family responsibilities don’t feel they have the time to renovate and don’t want the hassle of dealing with contractors. Another reason is that among the group of buyers willing to take on such a project, the sale piece has to reflect not only the actual cost of the required renovations, but also the considerable amount of their own time and effort the buyers will need to invest to get the home back into shape.
Statistics from Chester, Montgomery and Bucks Counties
Here are list-to-sale-price ratios in selected local zip codes for the fourth quarter of 2019. The selected zip codes each had at least 75 sales during that time period.
19382, West Chester 98.2%
19355, Malvern 97.1%
19460, Phoenixville 96.4%
19426, Collegeville 97.8%
19446, Lansdale 96.4%
19438, Harleysville 95.9%
18944, Perkasie 98%
18901, Doylestown 95.4%
19067, Yardley/Morrisville 95.1%
If you’re planning sell your home, contact Annette Nelson for expert advice at (610) 247-7892 or firstname.lastname@example.org.
Data is from BrightMLS.
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