Here’s more evidence that the Masachusetts real estate market is softening.
Home won't sell? Some cancel and relist
Agents aiming for fresh appeal
By Kimberly Blanton, Globe Staff | July 22, 2005
To remove the stigma attached to a house that won't sell and make a fresh appeal to home buyers, some real estate agents reset the clock on the number of days a property has been listed — a practice critics liken to resetting the odometer on a used car.
Agents can cancel a listing and create a new one for the same house in the central database of Massachusetts homes for sale, the MLS Property Information Network. The ''new” listing is then dispatched, electronically, to agents who generate a ''hot sheet” for clients of new houses coming on the market.
''We see it everywhere,” said Patrick Lashinsky, vice president of California-based Zip Realty Inc., which makes regional MLS databases around the country available to customers, including home buyers. ''Agents know that if they're at the top of the list as being a new listing, that's when you generate the majority of your client traffic for the home you're selling.”
The number of canceled listings in Massachusetts has nearly tripled since 2001, a sign that one of the hottest real estate markets in the country is beginning to cool down, said real estate specialists. It ''tells you is the market is softening. Demand is declining,” said Karl Case, professor of economics at Wellesley College.
The practice of canceling and relisting a property, which shortens its days on the market, makes it difficult for analysts and economist to gauge the strength of the real estate market. ''I rely on that data,” Case said. ''I'd prefer they not do it.”
On June 30, Massachusetts houses sat on the market, unsold, for 70 days, on average, unchanged from June 30, 2004, MLS data show. But May home sales in Massachusetts were 11 percent below May 2004 sales, and agents are bemoaning a growing inventory of houses for sale in some Boston suburbs.
To improve information for its member agents, MLS Property Information Network and similar services in other regions, including the Washington, D.C., area, recently made it easier to determine total listing days, known as ''cumulative” days, to its listings. MLS Property's aggregate ''days on market” statistic continues to be calculated using the incomplete information for some houses.
MLS Property said 6.5 percent of all houses sold since January had been canceled and relisted with the same agent. ''That's very low,” said Melissa Lindberg, MLS Property spokeswoman.
Maggie Tomkiewicz, president of the Massachusetts Association of Realtors and a Dartmouth agent, said the practice is not widespread, because agents can look up a house's history on MLS and convey to a buyer how long it has been for sale.
''That's what they hire us for, to interpret the data and to know those things,” she said. Home buyers don't have direct access to MLS data; agents must look up a property for a buyer. Commissions for agents representing the buyer and seller in a transaction are based on a percentage of the sales price of the property.
Michelle Ferranti is ''shocked” that neighbor Christopher Daleo's house on Arbor Lane in Woburn has not sold. Another neighbor, Michelle Palumbo, says his four-bedroom home, with extras like underground sprinklers, a centralized vacuum-cleaning system, oak-spindled staircase and light fixtures purchased in Manhattan, is viewed as the best one on a cul-de-sac of similar houses.
It has been on the market since March 8. Yet, on July 9, it appeared as a new property on MLS, said Daleo's agent, Pam Dooley. She had canceled it July 8 and renewed it the next day, erasing in several keystrokes information that might cause house hunters to wonder why the house wasn't selling. ''When it shows up as new it catches people's eye,” said Dooley of Prudential Preferred Realty in Woburn. Her client, who is relocating to Alabama for a research position at a biotechnology institute, dropped his price five times. ''It's priced to sell,” Dooley said.
The number of MLS Property cancellations is rising, an indication that agents are refreshing listings on tough-to-sell houses or frustrated homeowners are pulling houses off the market because they can't get their asking price. MLS had 10,606 cancellations in the first six months of 2005 compared with 9,722 in the first six months of 2004, according to an analysis of MLS data by Bill Wendel, owner of The Real Estate Cafe in Cambridge. In the first six months of 2001, just 3,736 listings were canceled.
In a recent spot check of houses for sale on MLS in Middlesex County, Barry Nystedt, president of the Massachusetts Association of Buyer Agents, said one in four listings canceled between May 25 and June 25 was recreated by the same firm with a new MLS number. The problem for buyers is that if their agent is unfamiliar with a neighborhood, the agent ''may convey to your buyer, 'This is a new listing, let's go look at it,' when in fact it's not a new listing,” said Maribeth Boisvert, with Coldwell Banker Residential Brokerage in Shrewsbury.
Jonathan Cohen, who will relocate from New York to attend Harvard Law School this fall and was briefly house-hunting, said knowing how long a property has been for sale is essential when placing a bid. The securities trader said it is more important for houses than for securities, because ''every house is different, every neighborhood is different.”
MLS rules permit agents to cancel a listing if they and their client agree to cancel their sales contract. A newly created listing is assigned a new MLS number. John Breault, MLS director of customer support, said his organization doesn't control how agents do business. ''We just try to look at the data and make it as accurate as we can,” he said. In the past, agents had to dig into a property's history in the database to find cumulative days on market. Last year, MLS made cumulative days more visible. When members look up a property on the database now, they immediately see both the current number of days for a new listing and, next to it, cumulative days on the market.
Jim D'Angelo, Century 21 agent with Travis Realty in Billerica, said the strategy of canceling and creating a new listing worked for him in selling a Billerica split-level: The owner is scheduled to sign a purchase-and-sale agreement later this month.
He negotiated the sale in early July, days after canceling the listing on June 20 and putting the house back on the same day with updates to the interior. Since December, the price dropped from $434,900 to $398,900. ''After a house sits for a little while,” D'Angelo said, ''it gets overshown.”
Kimberly Blanton can be reached at firstname.lastname@example.org.
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