Results Count: The Importance of Price Discovery

Pricing Strategies

Pricing strategies depend on tangible and intangible factors. They can include several drivers: supply, demand, local market dynamics, and the flow of information.

Recent research, based on MLS data and published by RedFin, clearly demonstrates that NAR’s average real estate professional does not have an efficient means of price discovery to support home pricing. The chart below illustrates this consistently since 2013, except for the COVID years:

• >60 percent of homes in the U.S. sold for less than the original list price. 
• ~15 percent of homes in the U.S. sold at the original list price.
• ~20 percent of homes in the U.S. sold for more than the original list price.

60 percent of homes selling for less than the original list price is poor performance and the portals do not do the seller any favors by posting days on market and price reduction timelines.

Inman Intel research says more than 70 percent of 1.5 million NAR real estate professionals did not have a closing in 2024. This suggests that home buyers and sellers are making the decision to consolidate their choice of professional representation to the best performing real estate professionals that are very active in the market.

This represents a flight to quality as we see in so many industries. I have been following Deloitte on this topic.

Many of you know Compass is my most significant client. Here are a few 2024 Compass statistics, included in Compass public reporting documents. 

• 94 percent of Compass listings trade through the local MLS.
• 81 percent of Compass Coming Soons that do not make it to the MLS sell at or over the original list price.
• 40 percent of Compass listings that follow the pre-marketing strategies sell for more than the original list price on the MLS.

94 percent of sales on the MLS are in line with nearly every research piece published in the last 12 months.

40 percent selling on the MLS for more than the original list price is fifty-two percent higher in 2024 that the industry average illustrated above.

Compass simply executes for its real estate professionals and their clients. 

Results count.

This is Where We Are Now!

Thanks!
Mark