How Many Make a “Meteor Shower?”
What’s a “housing market meteorite?”
Like the celestial kind, they burst onto the scene in a brilliant flash of light; descend (in price) through the night sky (housing market) quickly; then just as quickly disappear (they’re sold).
They often have these three additional attributes:
One. They’re top-to-bottom (bottom-to-top?) rehab’s;
Two. They’re vacant (goes with #1).
Three. They’re owned by investors who are bottom-line oriented, and will relentlessly cut the price until the property sells (goes with #1 and #2).
Buyer and Seller Responses
So, what should other market players do in response?
If you’re a Buyer looking for such a property . . . act fast.
Meanwhile, what should nearby, “non-meterorite” home sellers do while such a property flashes through the sky?
Watch, just like a real meteorite.
That means sitting tight (vs. cutting their price to compete) — and hoping that the nearby house sells quickly, for a good price.
“Comp” — or Not?
Post-closing, will such a property be a “Comp” (comparable sold property) for nearby homes?
It certainly passes the “recency test” (closed in the last six months — ideally less).
However, to be a genuine comp, the sold home must still be similar in size, style, and condition.
