Continuing our annual end of the year analysis of expired and canceled listings across Massachusetts, focusing this time on the 10 days before Christmas, 12/16-25/11.
Continuing our annual end of the year analysis of expired and canceled listings across Massachusetts, focusing this time on the 10 days before Christmas, 12/16-25/11. How much money can a DIY home buyer save by buying an expired or canceled listing directly from the owner? As the working graph above shows, commission savings on expired and canceled MLS listings dwarf the $8,000 federal tax credit that had some overeager home buyers rushing like fools (see our cartoon) into bidding wars in 2009 and 2010. (The Real Estate Cafe was outspoken critics of that policy, arguing that financially-savvy buyers who timed the market saved considerably more money.)
If you’ve been timing the market to avoid paying real estate commissions, now’s the time to “carpe diem” or “carpe discount.” As the graph above shows, commission savings (based on 5% off the last list price of an expired or canceled listing) are multiples of the $8,000 tax credit:
- Nearly 500 listing offer savings of one to two times the $8K tax credit;
- Approximately 300 offer savings of two to three times the tax credit; and
- Another 310+ offer savings of more than $24,000 — or more 3 times the tax credit!
- A surprising number of luxury listings are also expiring or being canceled offering commission savings over $100K!
The good news from the sellers’ perspective is that they can pass commission savings to potential buyers without lowering the profit on their last asking price. That’s why we’ve likened this seasonal opportunity to a “tax-free” or “commission-free holiday” for buyers and sellers. If you AGREE that expired and canceled listing can be a win-win proposition for DIY home buyers and FSBOs, as we wrote in our last blog post, should we talk briefly about what to do next?
Technical note / disclosure: Savings graphed above are based on approximately 1,300 MLS listings that expired or were canceled across Massachusetts during the ten days before Christmas, 12/16-25/11. Commisssion savings based on an estimated 5% of the last list price in the MLS. Actual savings will vary depending on price negotiations between DIY home buyers and homeowners selling for-sale-by-owner (FSBO) after their listings expire or are canceled.