What Sells a Home: Vacant, Seller, or Tenant Occupied?
2020 Real Estate Market Update. You’re getting ready to sell your home and you wonder, should I move out and vacate the property for the real estate market, or should I stay and not worry about it? Or let’s say you’re getting ready to sell your investment property with tenant inside. Should you wait until they leave to put it on the real estate market, or is it better to sell with a tenant inside?
A lot of articles we write might have a 10% – 15% impact on selling a home, such as picking the right time of year to buy or sell. Even a 10% difference in being able to sell a home is huge. But occupancy, who is or is not in the home, can have up to a 20% to 30% impact!
These numbers are pulled from RMLS, Jan. to the end of July 2020. Target is the greater Portland Metro area as defined by RMLS and property type is all residential homes.
Even in a Seller’s Market Not all Homes Sell – Nearly 20% Do Not Sell
From Jan. to the end of July 2020 there were 23,430 new residential homes listed for sale in the Portland metro area. Of those 18,904 were pending or sold by the end of July. That is a success rate of 80.6% and a failure rate of 19.4%. This means if you were one of those homeowners that listed a home for sale in the Portland area sometime in the first half + of the year in 2020 there would be about an 81% chance you’re pending or sold by now and a 19% or so chance that you canceled and gave up.
Vacant Portland Homes Sell Best
Of the 18,904 homes that sold or went pending, 7750 were vacant. Of all the listings that were cancelled or expired in that same time period, 2240 were vacant. (Notice the cancelled and expired rates are a little higher in each category due to some homes cancelling and relisting multiple times prior to selling. However, we can still get the exact numbers in each category and see the clear difference in success and failure rates.)
Seller Occupied Homes Sell Second Best
Of the 18,904 homes that sold or went pending, 7938 were owner-occupied. Of all the listings that were canceled or expired in that same time period 2873 were owner-occupied.
Tenant Occupied Homes Hardly Sell
Of the 18,904 homes that sold or went pending, 389 were tenant occupied. Of all the listings that were cancelled or expired in that same time period 319 were tenant occupied.
Sold Home Percentages
- 18,904 total pending or sold
- 41% were vacant
- 42% were owner-occupied
- 2% were tenant occupied
- 7% were under construction (1,297 homes)
- 8% misc. (No occupancy status listed in the MLS)
Relative Failure Rates to Sell
Again the overall failure rate to sell from Jan. to the end of July 2020 was 19.4% for all residential categories. Fail rates listed here are higher due to some properties going active, being taken down (canceled or expired) then listed active again within the same timeframe. But we still get averages of success in each category.
- Vacant Home Relative Failure Rate = 22%
- Seller Occupied Relative Failure Rate = 27%
- Tenant Occupied Failure Rate = 45%
Estimated Failure Rates to Sell
This would be trying to take out the bloated numbers from sellers who occasionally relist the same properties.
- Vacant = 17% Failure Rate
- Seller Occupied = 22% Failure Rate
- Tenant Occupied = 40% Failure Rate
Selling Investment Property
It is clear from this report that if you have a detached home, condo, or townhome – anything RMLS deems residential – then your best bet is to wait until the tenant is out before selling. Only sell while vacant. This opens up your property to the entire (massive) home buyer pool, not the slim investor pool. The success vs. fail ratios are clear as day. Now, if you have a multifamily apartment building for sale, that is completely different. Those properties are typically only purchased by an investor pool and that investor pool wants those buildings full of tenants.
Selling Your Own Home
There is an advantage to selling a home vacant, but it is a few percentage points. It is still okay to sell owner occupied. One thing we often recommend our clients do – if possible – is vacant the first long weekend the home is on the real estate market. Often we are able to sell a home in the first weekend, which means it essential sold with all the advantages of being vacant. Even if the home doesn’t sell in the first weekend, it is still best for the seller as that is the main rush of buyers and afterward it will be easier to schedule one appointment at a time.
Sell a Home with the Best
We are top ranked seller’s agents in the greater Portland metro area every year, often number one overall. Check out our pay less, get more home selling program here. We have the experience and marketing you need to be successful.September 1, 2020