Using an expired listing

[Doug Wegener]

As a 5th or 6th comp. Have you ever done that? I've frequently included a listing as supporting evidence for credibility but I dont believe I have ever included an expired. At least it shows an upper range.

If you did it, did you have any problems with underwriters by including it?

 

[Lloyd Bonafide]

I have done it quite a few times, especially if it is a recently cancelled listing, and there are not any other more similar active listings nearby. I will just state something like "Comp #5 is a recently cancelled listing, and is the same floorplan as the subject. It was listed for sale 11-07 for $500,000, and the listing was cancelled 4-30-08 without selling, at a final list price of $480,000."

 

[CURT VAN HOOSER]

Doug,

Why in the world would you want to use an expired listing? Can we assume it ran its course for exposure and did not sell? If so, it's probably overpriced for the market. I suppose if you could use it as an example of what price won't work in the market. I have, in the past, looked at old expired listings on properties that have since sold, in order to get some insight about the property characteristics and amenities, but that's a different issue.

 

[Michigan CG]

Doug,

Why in the world would you want to use an expired listing?

Because that tells you what something isn't worth. A very comparable listing that has expired can show my idiot MB that "Here, as any idiot can see, the subject property isn't worth $zzz as shown by this comparable that was on the market 180 days and did not sell."

 

[Lloyd Bonafide]

Why in the world would you want to use an expired listing? Can we assume it ran its course for exposure and did not sell? If so, it's probably overpriced for the market. I suppose if you could use it as an example of what price won't work in the market.

Exactly - just like an active listing. To show what the subject is not worth.

 

[Wendy]

I have used them as supporting evidence, but not in the grid.

 

[The Sheriff]

I grid them when necessary to show what the subject is not worth... When your comps are dated (over three months in a declining market), it helps to utilize an expired or cancelled listing that was market tested if they are lower than the original sales prices of those comps. These also help shed light on the negative time adjustments... and keeps the idiot brokers from wanting more value.

 

[Terrel L. Shields]

Such an expired listing can tell you that that is a market top, but it doesn't tell you how much over the top it is... fallen contracts are much closer to unity with market top.

We have a ton of vacant land listings which are in the $10,000 plus per acre range. The only thing selling is in the $2,000 - $4,000 per acre range. I recently saw a 113 acre parcel sell for $112,000 - cheapest land sale in this county in several years. It was a rough woodlot but there simply isn't many buyers out there for such anymore. The same seller sold some flat open ground for $3,750 per acre across the road which had more utility for some agricultural buyers but woodlots don't pay for themselves and no one seems to want to speculate on them now.

I understand some Realtors are telling sellers that they don't want those listings anymore. They are simply an expense to list and unlikely to sell. Not worth the expense. A lot of them just want out and cannot sell without leaving money on the table... such is life.

 

[Mike Kennedy]

I have used them as supporting evidence, but not in the grid.

ditto.

 

[Kevin A. Spellman]

Review the data and make sure it did not sell as of the effective date of value. Confirm the status of the listing.