Home Sales Success Rate Graph

One statistic that we have been maintaining at The Market Bulletin is a measurement that we refer to as the “Sales Success Rate.”  Recently, the one-year trend has dropped from a two-year high, after returning from a low of 30% reached in June of 2009.

By dividing the total number of closed sales by the total number of new listings, over a specific time period, we can show a trend that gives a hint at how many homes (as a percentage of the total) are actually selling.

Conversely, we can measure the home sales failure rate as the total number of listings that failed to sell over the past 365 days divided by the total number of listings taken during that same period of time.

Sales Success Rates Still Too Low

So, in simplified terms, we can say that over the past year, roughly 43% of the homes that were listed actually sold, while 57% of the listings taken failed to sell.

The success trend currently appears to be on the rise, though we know the normal seasonal surge of new listings is just hitting the market and might put a damper on this observation.

The failure trend once rose to 70% in June 2009 and it might be heading back to that level when these listings enter the market. We will keep a close eye on these activities because this trendanalysis points the way to the speed in which the recovery will take.