Of all Sequim homes sold in Sequim, Washington, which price category has the most overpriced listings?  Very few people would know the answer to this question, and I would bet that very few Realtors know the answer.  The issues I address about Sequim homes are questions that clients regularly ask, and which homes are priced the best and which ones are priced too high is very relevant if you are a buyer.  This kind of knowledge can give you a substantial edge when it comes to negotiating to get the best possible price on your retirement home.

Sequim Homes Sold by Price

Sequim Homes Sold and Surprising Price Pattern

I love to put together charts like this one, because a visual aide can clearly present an entire story instantly, and with a little analysis, this information can be very helpful.  This chart shows Sequim homes sold during the calendar year 2011 starting at $200,000.  There were 97 homes sold for less than $200,000, and there were 99 homes sold from $200,000 to $300,000.  Above $300,000 is where sales drop off dramatically.  But it is in the price category of $400,000 to $500,000 where I saw a surprising pattern that was not found in any other price category.

Sequim Homes Sold Most Overpriced

We all know some Sequim homes are overpriced.  That’s not front page news.  (Of course, there are many Sequim homes in the MLS that are listed at incredibly reasonable prices, too.)  If I do a search for Sequim homes that have been on the market for 270 plus days, I get a long list.  Believe it or not, there are homes on the market as of today that have been on the market for 2,103 days, 1,178 days, 1,115 days, 1,092 days, 1,079 days, 1,009 days, 1,001, and over 100 that have been on the market for more than 270 days.  It is a no-brainer that these homes with such long DOMs (Days on Market) are most likely overpriced. 

I show homes in every price category, although the vast majority of my retired clients are looking at homes above $200,000.  For several weeks I’ve been showing a lot of homes in the $400,000 to $500,000 price category, and I have been very surprised to find so many of these homes substantially overpriced.  Nearly 50% of these homes have been overpriced, and several by as much as $75,000 to $150,000.   Why?  How could this price category be so dramatically overpriced?

I discussed this with my clients (Bert and Sally) while looking at these homes this week, and I think Bert hit the nail on the head.  He suggested that homeowners who built or purchased their homes in the early 2000′s (or before) had homes with high assessed tax values, perhaps $600,000 or $675,000.  These are people who built their dream homes with all the features they loved, and for years they would say things like, “It’s worth $600,000.  You bet.”  They had planned their homes for years, and they were proud of their homes, and they certainly were entitled to be proud.  Now in this recession, they want to sell it for what they may have in it, or a little less, and that price may be $450,000.  The problem is, it may only be worth $375,000 in this market, but they cannot mentally comprehend that.  They are stuck at $600,000, so in their minds, they think they have reduced the price already by 25% or 30% to $450,000.  That kind of thinking is getting them in trouble.  It is the wrong way to think about selling a home in this market.  (It is extremely difficult for a listing agent to be able to break through this mental barrier and help their clients, and in many cases it is simply impossible.)

Buyers are looking at Sequim homes and comparing floor plans, features, and the views.  Then they compare the prices, and the single price category most outrageously overpriced is from $400,000 to $500,000.  Unfortunately, the sellers don’t know this.  They don’t realize their homes are grossly overpriced, and they haven’t seen this chart or the reasoning.  Buyers are the ones doing all the due diligence on sites like this one.  Sellers do not seem to be doing their due diligence on listing prices, marketing, and the reasons their homes have not sold.  Far be it from me to try to educate all the owners of Sequim homes out there.  That’s not my job.  My job as a buyer’s agent is to help my clients, not other agents’ sellers.

Possibly Related Posts:

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• Sequim Listings vs. Sequim Homes Sold in 2011
• Sequim Homes Sold by Price Range
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In this article I compare Sequim listings (active listings) in the current inventory to the homes sold in that same price range.  This is important for sellers to know.  Here’s why.  If there have only been a small number of Sequim listings sold in a particular price range, it makes a big difference if there are a large number or a small number of active listings in that same price range.  A large number of active listings with a small number of sales means many DOM (days on market).  And a buyer’s market like this plays against the sellers getting the price they would have expected in a better market.  Click your mouse on this chart below to see an enlarged version.

Sequim Listings vs. Sequim Homes Sold in 2011

Sequim Listings in Active Inventory

In a prior article I included this chart with Sequim listings sold, but in this chart I added the active listings in the inventory.  It’s a busy chart, but I think sellers and buyers will find this information very helpful.  Here’s how to read this chart.  In the price $500,000 to $600,000, there have only been four sales in Sequim in all of 2011 (the first 9 months), and there are 12 Sequim listings actively for sale right now.  This translates into a three year inventory based on sales this year.

Sequim Listings in Higher Price Ranges

You can see that in the higher price ranges this difference between hard sales and the inventory is more pronounced.  Above $900,000, only two have sold and there are currently 12 homes for sale above $900,000.

What does all this mean?  It is proof of something we already intuitively know–that luxury homes are more difficult to sell in a small real estate market like Sequim’s.  I would add that selling luxury homes is also different than selling homes in the lower price ranges.  Marketing to buyers of foreclosures or short sales or affordable manufactured homes is a different marketing system and reaches to a different segment of the buyer market than buyers of luxury homes.

These are challenging times.  Sequim listings are selling, but it takes much more to sell a home in this recession than it in 2005.

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How many Sequim homes sold by price range during 2011 (January through September)?  So glad you asked.  I’ve pulled together the numbers from the Olympic Listing Service, and this chart shows the total number of Sequim homes sold by price range starting from $100,000 and up.  It’s no surprise that the majority of homes (including mobile homes) have sold below $200,000, but the primary price range for retirees is the next price range from $200,000 to $300,000.  It’s more than just interesting that above $300,000, the sales drop off dramatically.

Sequim Homes Sold by Price

Sequim Homes Sold by Price v. Port Angeles

More homes sold in Port Angeles than Sequim in the lowest price range.  In the upper price ranges, almost all the homes purchased were in Sequim.  No homes sold in Port Angeles above $600,000.  Ten Sequim homes sold above $600,000.  Clearly retirees who are buying luxury homes have chosen Sequim rather than Port Angeles in 2011.  This is very significant.

The average price of  homes sold in Port Angeles is $197,689, and the average days on market (DOM) is 104 days.  The average price of homes sold in Sequim is $256,829, and the average DOM is 144 days.  Sequim homes sold are an average of almost $60,000 more than Port Angeles homes sold.

Sequim Homes Sold by Price Implications

When you look at Sequim homes sold by price, and you examine this chart, it becomes apparent that there are a very small number of buyers for homes priced above $500,000.  Port Angeles is not even in the game.  Not only does this tell homeowners with luxury homes that there are very few buyers for their homes, but it also tells me that to market and connect with qualified buyers of luxury homes, there must be a marketing system in place that will reach those select buyers.  Homeowners cannot rely on the MLS, the newspapers, listing agents, or luck.  They will need much more to successfully reach qualified buyers and close a sale.  Buyers of luxury homes are few and far between.

Possibly Related Posts:

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Chuck Marunde is pleased to announce that he acted as a Buyer’s Agent in the sale of another home in Port Angeles.  This home is a four bedroom, two bath,  two story home with 2,600 square feet on a Port Angeles city lot.  It’s a nice neighborhood.  This home is a Bank of America foreclosure and was listed at $177,000 and sold for $128,000.  Don’t expect to find many deals like this.  This was one of the best prices I’ve seen in this area.

Port Angeles Home

You can search for both Port Angeles homes and Sequim homes for sale with one of the best online MLS search sites, and it requires no personal information or registration from you:  Sequim Homes for Sale (includes Port Angeles).

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Chuck Marunde is pleased to announce another Sequim home sold.  Today a beautiful Sequim home sold after being on the market for a long time.  Some homeowners have taken their homes off the market during the winter months, but my argument is that buyers are arriving and asking me to help them find a home.  Sometimes the timing for a buyer means they are looking and ready to buy in November, December, or January.  The y may have retired or sold their home, but I am representing many buyers looking for and qualified to buy nice homes in Sequim.  Homeowners who want to sell their homes should not take them off the market.  They might miss the one buyer that comes to town during this time.

Sequim Home Sold

Sequim Home Sold in Winter

This Sequim home has a nice panoramic view of the Olympic Mountains looking across the Sequim valley to the mountains on the south side of Sequim.  This photo was take earlier, because believe it or not, Sunny Sequim is raining today.

Sequim Home Sold in Great Neighborhood

One of the great attractions to Sequim for retirees are the great neighborhoods.  We have traditional neighborhoods like Sunland or Bell Hill, and we have many developments with larger sized lots, from a half acre to 20 acres and more.  One comment I get from clients  all the time is that people in Sequim are so friendly.  While looking at homes my clients often meet neighbors, and it is true that people in Sequim are friendly and the kind of people you would love to have as neighbors.

“I love representing buyers and helping them find the ideal home and negotiate the best possible price, and that’s what we did with this home,” says Chuck Marunde.  Another Sequim home sold by Sequim & Port Angeles Real Estate, a branch office of eXp Realty.

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What is the price range of Sequim homes sold (and Port Angeles homes) sold in 2010?  This is an important question, because it shows us the probability of homes selling based on price.  If you have a home for sale  now or  one that you want to sell that is in the upper price brackets, you can see how many have sold in this chart and, therefore, the probability that you will sell your home.  There is much more to statistical analysis and probabilities, but most homeowners don’t know how many homes have sold in their home’s price range, so this chart will be helpful to gauge the likelihood that you will get your home sold, or perhaps a better way to say that is the “reality check that homes in your price range are not necessarily selling every month” (or this year).   Armed with this information, you can put together a plan to market your home and get it sold, considering the realities of this data.

Site built Homes sold are represented in this chart, showing homes sold monthly from January 1 to August 31 in 2010 by price category.  Starting with $200,000 to $300,000, this chart shows how many homes have sold in each $100,000 price range.  [Click on the chart once and then after a few seconds again to enlarge it.]

Sequim Homes Sold

Sequim Homes by Price

Clearly the most Sequim homes sold are in the price range from $200,000 to $300,000.  This has been the biggest market for buyers from out of state who have found an opportunity buying Sequim homes at the lowest interest rates of their lives, and with the price reductions, a large inventory of homes fit in this price bracket.

Sequim Homes by Price Brackets

Sequim homes in the $300,000 to $400,000 price bracket represent some of the best values for buyers in this market.  Beautiful custom homes are being sold in this bracket that were as much as $450,000 to $500,000 in 2005.

Above $400,000 it gets interesting.  Only 23 homes have sold above $400,000 this entire calendar year in 2010.  And only 3 homes have sold above $600,000.  Of all the Sequim homes sold, only one has sold above $700,000, and zero Sequim homes have sold above $800,000.   This means that less than one-half of one percent of homes sold this year are above $700,000.

For buyers who can afford a home in the upper price brackets ($500,000 plus), there are some extraordinary buys right now in this market.  A home in 2005 that might have sold for $900,000 may be listed on the market now for $580,000.  While this segment of the market speaks to a very small percentage of buyers right now, it may be the greatest opportunity for buyers who want an extraordinary custom built home at a bargain price.

There are a number of conclusions that one may draw from this data, but one rational conclusion or deduction one can draw from this data is this:  Sequim homes in the upper price brackets must be marketed very effectively to connect with the potential buyers who are few and far between.

Possibly Related Posts:

• Sequim Homes Sold – Most Overpriced Price Category
• Sequim Listings vs. Sequim Homes Sold in 2011
• Sequim Homes Sold by Price Range
• Another Port Angeles Home Sold
• Another Sequim Home Sold