What’s a Sale?

An observant reader has been following sales at Brix and wonders why the number has fluctuated so much. I suspect the number has fluctuated because we (bloggers, marketers and real estate agents) have loosely used the word sales to refer to anything from reservations to closed transactions. Unfortunately not every “sale” actually results in someone moving into a unit.

To eliminate confusion going forward can we all never use the word sales again? My proposal:

Reservations: Interested buyers put money down but it’s refundable.
Signed purchase & sales: Committed buyers put money down. Typically 5%. This doesn’t mean they’ll close and moved in though.
Closed transactions: Sales that have recorded with the county.

Going forward I won’t ask condo sales agents for “sales” numbers. I’ll ask them for above.

About Matt

Matt , Urbnlivn's publisher, has a love for lofts, floating homes and mid-century moderns.

For years Matt resisted becoming a real estate agent preferring to be an executive in the startup world but he recently caved in the spring of 2014 and became an agent.

You can also find Matt on Twitter or skiing.

  • http://stroupecondoblog.com Justin Bowers

    I think this is a good standard to set. We’ll make sure we inquire & report the same before we post at StroupeCondoBlog.com.

  • GoCougs

    Matt,

    Good thought. This is exactly why the NWMLS loves to quote “pending sales” figures, because it creates an illusion that condo sales are increasing. I strongly believe that if one actually looked at closed transactions, activity has continued to drop precipitously. This is the same deal with “median price”. If a number of high priced condos close, it appears to increase the median price for the year/month, yet the actual sample set has shrunk substantially, creating another illusion.

    Mark Twain said: “There are three kinds of lies: lies, damned lies, and statistics.”

  • Peckhammer

    Next, I'd like to see the same honest approach taken with regard to inventory and MLS listings.

  • Dan L

    No reason not call a closed transaction a “sale” in my opinion. But I do agree that this is the only situation in which the term “sale” should be used.

  • Brett

    It is simple and an industry standard to break it into two categories; sales and closed sales. Sales include closed sales. The mls breaks it out into numerous categories; contingent, pending back up requested, pending feasibility, pending inspection, pending, and sold.

    “Sold” and “closed sales” helps determine active sales volume as well as the number of people living in the community.

    I'd be happy if they told about how many sales (sold) and homes available.

  • GoCougs

    Matt,

    Good thought. This is exactly why the NWMLS loves to quote “pending sales” figures, because it creates an illusion that condo sales are increasing. I strongly believe that if one actually looked at closed transactions, activity has continued to drop precipitously. This is the same deal with “median price”. If a number of high priced condos close, it appears to increase the median price for the year/month, yet the actual sample set has shrunk substantially, creating another illusion.

    Mark Twain said: “There are three kinds of lies: lies, damned lies, and statistics.”

  • Peckhammer

    Next, I'd like to see the same honest approach taken with regard to inventory and MLS listings.

  • Dan L

    No reason not call a closed transaction a “sale” in my opinion. But I do agree that this is the only situation in which the term “sale” should be used.

  • Brett

    It is simple and an industry standard to break it into two categories; sales and closed sales. Sales include closed sales. The mls breaks it out into numerous categories; contingent, pending back up requested, pending feasibility, pending inspection, pending, and sold.

    “Sold” and “closed sales” helps determine active sales volume as well as the number of people living in the community.

    I'd be happy if they told about how many sales (sold) and homes available.