Listing strategies and housing busts: cutting loss or cutting list price?
||Liu, Xiaolong; Arno Van der Vlist
||Listing strategies and housing busts: cutting loss or cutting list price?
||24th Annual European Real Estate Society Conference in Delft, Netherlands
||Listing your house for sale has been referred to as ‘the most agonizing and among the most stressful decision’ that go with selling a home. This may seem particularly so for homeowners expecting to sell for less than their original purchase price. In this paper, we investigate whether listing strategies among homeowners who experience a potential loss differ from those not experiencing a potential loss. We use MLS data from the Randstad area of The Netherlands over 2008 - 2013 for which we have detailed information regarding the listing strategies. We find that those homeowners who expect a loss; set higher initial list prices, are more likely to and more aggressively revising their list prices downwards, and set final list prices still above those of homeowners not expecting a loss upon initial listing. Further, we find sellers' motivation to be an important underlying driver in listing strategies.
||housing; loss; property transaction; list price revision
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||Housing Markets & Economics
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