Central Ohio Real Estate Market Hampered By ‘Selleritis’
“Hey coach, I can play.”
“Hey coach, I can play.”
“Nah Jimmy, we’re going to let you sit this one out. Doc says you got a case of ‘selleritis’.”
“Nah Jimmy, we’re going to let you sit this one out. Doc says you got a case of ‘selleritis’.”
Okay, so maybe that conversation has never taken place, but one that has all over Central Ohio between Realtors and buyers is — “where are the rest of the houses at?”
It is a condition that I’ve coined as selleritis.
One of the biggest challenges of “Selleritis” is that it creates a dynamic where both buyers and sellers think they have the upper hand. This chart shows how the original list to sale price and the final sale to list price percentage has changed very little over the past five years which you would not expect if it were a true seller’s market. (information from Columbus Board of REALTORS, chart created by Toby Boyce and all rights reserved)
Oh great, the fat man is playing doctor again … “what is selleritis?” he probably expects us to ask…
Oh, I’m so glad you asked!
Selleritis is a condition where sellers receive good news about how the real estate market is recovering and everything is moving. The picture sure looks rosy, but when they attempt to move, something hurts, so instead of actually doing anything the seller holds tight paranoid about what to do.
While the title “selleritis” and the tone of this post are relatively funny, the situation that selleritis creates is anything but.
You can tell if you have signs of selleritis if you talk consistently with your co-workers about selling your home and then within 15 minutes have reversed course and are rehabbing the bathroom. Your spouse and you are often discussing a new place to live but never talk about actually selling the one you have. Or my personal favorite, you’ve decided the only way to sell your house is based upon the appraisal you received in 2004 and just pretend the past eight years never happened.
What Makes Selleritis Bad?
- Shows False Positives. We are a people driven by the sound bite and statistics are awesome for sounds bites. And selleritis screws up the statistics. There I said it. It is a big-fat asterisk, just like the monthly jobs report. “Monthly Inventory in Powell is down to 2.9 percent” would be amazing if it wasn’t largely driven by the fact that August 2012 listings in Powell were down by more than 52 percent in the past five years. Add those listings back into the market and the inventory is running about 6 months – exactly where it was in Powell in August 2008.
- Seller Confidence, Buyer Confidence. The buyer makes that offer being told by her Realtor it is a buyer’s market, while the seller looks at the offer thinking “What? This is a seller’s market! No way, I’m agreeing to all that!” Who is right? Well the statistics again say … both.
So we can see that the situation has created a unique situation where there is a bubble of demand for homes that are priced right in the market. Yet, sellers have to still think it is a buyer’s market to succeed and that is confusing to me as a real estate agent … and I do this every single day.
What Causes Selleritis
- Too Many Voices in My Head. We live in a 24-hour news world where if you don’t believe something just use Google and you’ll find its counter-argument published – probably by the same – media source. This becomes an issue when a seller wants to sell a home and looks at these pundits and the varying arguments begin to cancel each other out and creates a sense of fear … and fear leads to paralysis which leads too … doing nothing.
- Clowns in Washington, D.C.. I don’t care which side of the aisle you are on and this is a political point only in that we need cooperation to solve the nation’s ills. America became the greatest nation in the world via compromise and bi-partisan working together. Not by extremists burying in their heels and threatening to throw the country into an abyss if they don’t get their way. Would you try to sell a house knowing that with a 90 day marketing period you’d be in the middle of closing when the “Financial Cliff” comes to realty? Me neither.
- Too Much Debt. You have options. Stop going out to eat every night and pay down your mortgage. It’s pretty amazing the things you can do when you buckle your belt a notch tighter. Not the answer you wanted, but you don’t come here for me to give you sugar coated news.
- Fear. This is the most relevant and the “worst” of all these issues because it is irrational and there isn’t a response I can give to you to fix the issue. I can explain the situation to you in plain English and calm down the voices, we can talk about your liability and your exposure should the “financial cliff” become a reality, and we can evaluate if you have too much debt. But if you are afraid the only thing that we can do is talk about it … and even then it will probably not work.
Facing selleritis? Don’t worry, there are ways to face it. The best way is to sit down with a professional and talk about your home and your current concerns. You can contact Toby by phone at 740-990-9748 or via our handy contact-us form through the Web site.
[...] all the way down to 214. This has created a “problem” in the real estate market – I’m calling it Selleritis — in which buyers are still are still asking for the world while market stats attempt to tell [...]