Pricing your home is one of the trickiest parts of the selling process. Often, sellers turn to the local expertise of brokers to help set the price in order to maximize the best return or, in some cases, to lower the time the home sits on the market.
Another useful tool for establishing price is knowing how much of the initial asking price was actually received in your neighborhood.
In the May StreetEasy Manhattan Condo Market Report, we introduced the median sale-to-list price ratio for condos sold in Manhattan neighborhoods. The sale-to-list price ratio represents the percentage of the initial listing price the seller received in the final recorded sales price.
For example, if a seller listed a property for $1 million and the property ended up selling for $900,000, the sale-to-list price ratio would be 90 percent. A relatively lower sale-to-list price ratio indicates more negotiating power for buyers, whereas a higher ratio indicates that there is greater competition among buyers.
A neighborhood with a sale-to-list price ratio greater than 100 percent is among the most competitive for buyers. In these markets, buyers engage in bidding wars against each other, which raises the price above the seller’s initial ask.
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In May, the median sale-to-list price ratio in Manhattan was 99.4 percent, up 1.0 percent from last May.
Neighborhoods with the highest sale-to-list ratio included Lower East Side (104.9 percent) and Midtown West (100.1 percent). Neighborhoods with the lowest ratio in May were Midtown (91.9 percent) and Murray Hill (97.1 percent). If you are homeowner in the Lower East Side or Midtown West and you are thinking about selling, you may want to sell while demand still far exceeds supply in your area.
For all Manhattan neighborhoods in which enough data was available, median ratios exceeded 90 percent in May, highlighting the strength that sellers wield. Low inventory in Manhattan means more competition among buyers for available units, which in turn means less negotiating power in brokering a discount.