Q: When is a “new list” not new?
A: When it’s a re-list
“‘Insanity’ is doing the same thing over and over again and expecting different results.”
January in Minnesota is about snow, subtly lengthening days (finally!), and — to Realtors — re-lists. Lots and lots of re-lists, especially this year.
If you’re not familiar with the phenomenon, cancelling and re-listing a property is the preferred way for Sellers (and their Realtors) to raise the profile, however briefly, of a home that’s been for sale for awhile and starting to get “tired.”
Like Craig’s List, the Multiple Listing Service (“MLS“) database is a dynamic river of new information. The main difference is that the flow is vertical — specifically, top to bottom — not horizontal.
The vast majority of prospective Buyers (as well as Realtors) focus on the newest properties to hit the market. If you’re seriously shopping for a home, and your criteria are reasonably crystallized, you’ll quickly become familiar with all the existing inventory that meets your criteria (or doesn’t, as the case may be). So you keep your eyes on what’s new to market every day.
For Sellers, the catch is that so much comes on every day that any single listing is quickly buried. After 60-90 days in a market the size of the Twin Cities, it’s likely that thousands of listings have come on the market since yours.
So how do you get your home put back on top of the pile? By canceling and re-listing.
Three types of Re-Lists
In truth, there are really three kinds of re-lists.
One. The Serial Re-Lister.
If once is good, several times is better, right? Definitely, positively, not.
Re-listing doesn’t really fool anyone, at least not for very long. That’s because the MLS has two links, “CDOM” and “History,” which show what’s really going on. “CDOM” stands for “cumulative days on market,” and is exactly that. No matter how many times you cancel and re-list, you can’t re-set CDOM (the only way is to take your home off the market and wait one year).
“History” shows, line by line, every change in a home’s sales status. The categories include “Active” (same as new); “Pending” (there is a consummated contract, but the deal hasn’t closed); “Closed” (equals “sold”); and “Expired.”
When an experienced Realtor sees a property history with row after row of status changes, they know that: a) the property was seriously overpriced initially; b) the Seller isn’t serious about selling; or c) both a) and b).
Invariably, the answer is (c). When that’s the case, the inevitable, final row is usually . . .”Expired.”
“Line in the Sand?”
Two. “The Line in the Sand” Re-list.
One of the features of the current, Buyer’s market is frustrated, increasingly inflexible Sellers. When their home first doesn’t sell, such Sellers may respond by reducing the price in conjunction with making some cosmetic improvements, investing in better staging, etc.
Eventually, however, their willingness (or ability, depending on what they owe) to accept further price reductions evaporates. So, they instruct their realtor to cancel and re-list . . . but at the same price.
This time of year, the MLS database is clogged with homes that either were cancelled around Thanksgiving, and are now being brought back on as new, or, are simply being cancelled and re-listed on consecutive days, with no change in price.
Unfortunately for such Sellers, along with the economy generally, the housing market in most areas has continued to weaken the last few months. So an asking price that was too high in November is even more unrealistic now.
Such a mindset evokes Einstein’s definition of insanity: doing the same thing over and over again and expecting different results.
It also recalls an anecdote about Ben & Jerry, of ice cream fame. The two had the same sixth grade Phy Ed teacher, who told the students that if they couldn’t do that day’s required exercise –running a mile in less than 12 minutes — they’d have to do it over again until they did.
Ben and Jerry supposedly looked at one another (one can presume neither one would have been mistaken for Carl Lewis), shrugged, and asked the obvious question: ‘if we couldn’t run a mile in 12 minutes the first time, what makes him think we can do it the second (or third, or fourth)?”
Three. Which leaves the legitimate cancel-and-relist.
Whatever the initial asking price, the re-list price is now at — or even slightly below — current market value. Along with the new price, the Realtor freshens the listing’s marketing language, and updates any photos that may have become seasonally stale. The owner addresses any cosmetic, easily corrected objections from previous showings.
And perhaps most crucially, the listing agent couples the cancel-relist-price reduction with an aggressive marketing push. That includes networking the price reduction, putting the home back on broker tour (Tuesday’s), and holding the house open the next Sunday.
In my experience, such an orchestrated “surge” (oops, bad term) often results in a deal in relatively quick order.