Listing strategies and housing busts: cutting loss or cutting list price?

Xiaolong Liu and Arno van der Vlist

ERES from European Real Estate Society (ERES)

Abstract: 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.

Keywords: Housing; list price revision; loss; property transaction (search for similar items in EconPapers)
JEL-codes: R3 (search for similar items in EconPapers)
Date: 2017-07-01
New Economics Papers: this item is included in nep-ure
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Journal Article: Listing strategies and housing busts: Cutting loss or cutting list price? (2019)
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Persistent link: https://EconPapers.repec.org/RePEc:arz:wpaper:eres2017_366

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