The Listing That Sits: Use AI and MLS Data Before You Cut the Price

The typical seller in North Texas right now is closing about 6% under what they first asked on a $400,000 house.That is around 24 grand.And most of it traces back to one decision that was made before the sign ever went into the yard.The starting price.So today I'll show you how to use AI and real data to have that conversation upfront and what to do if it's already too late.So let's get to it.Welcome to Texas Real EST and finance podcast.Every week we look at what's actually happening with rates and housing right here in Texas, and then how to use AI to do something about it.I'm your host, Mike Mills.I'm a North Texas mortgage banker with about 17 years in, and I'm the guy who keeps telling everybody to take the closing costs.I got into AI because it gave me back hours in my own business, so I started teaching it to realtors.Now, I don't have it all figured out.Nobody does, because it changes almost every single week.I'm just testing it in the real world and telling you what works and what doesn't.So thank you for spending part of your week here.I don't take that for granted.Okay, so here's what's on the board for this week.Rates come down a little, and I'll tell you why.It all comes back to us.Debt.A buyer tip on why knocking 10 grand off the price might be the wrong win.The North Texas numbers for September and how much sellers are giving up right now.And a seller tip on finding the problems before the buyer's inspection does.And this week, Mike's mind has seven year car loans, Gen Z betting their retirement, and a congressman talking about summoning UFOs.And for listing agents, the one question to ask when a buyer wants 10 grand off the price.And the big one at the end, the listing that sits and how to use AI to build the case for your seller.Now, quick, cool little plug.Before we get going, if this show helps you subscribe, and if you're feeling generous, leave me a review.It helps more people find us.The podcast is the fun part, but the mortgage business is what pays for this microphone.So if you've got a buyer who needs the real math on price versus closing costs, or a deal that needs a lender who will actually pick up the phone, give me a call and I'll run the numbers for you.All right, plug over.So, leading things off, let's get to the question that every realtor and every client asks me.Every Single week.Hey Mike, what are the rates?Well, they're better than three weeks ago, but worse than a year ago, so pick your headline.So according to the Mortgage News Daily index, as of October 20th, the 30 year fixed conventional loan sits at about 7.4%, the 15 year fixed conventional sits at about 7.05%, the 30 year FHA is about 7.02.The 30 year VA is about 7.04 and the 30 year jumbo is sitting around 7.65.Now these are market averages provided by Mortgage News Daily, not a rate quote.Your actual rate depends on your credit, loan type, down payment and a handful of other factors.So talk to a licensed mortgage professional like me to get your actual rate based on your actual situation.Compliance nerds satisfied?So three weeks ago the 30 year was sitting right around 7.58%.And today as of this recording, it's about 7.4.So there was a little relief.But a year ago it was sitting around 6.23.So right now we're still more than a full point higher than this time last year, but still a far cry from where most consumers will start to feel comfortable again about buying a home.So then the question is, what moved it down this past week?Short version is it rides on top of the 10 year Treasury.And the 10 year comes down to one thing, U.S. debt.You see, the government keeps borrowing and it has to pay more to get more people to lend it money.So high mortgage rates are really a debt issue and it's always going to be a debt issue.But here's what happened in the middle of last week.On October 14, the Nasdaq dropped 1.9%, its worst day since July.And a lot of that was worry about how much borrowed money was going into AI, data centers, chips, all of it.So money came out of stocks and ran into treasuries, and the 10 year dropped about 5.09% and that was a three week low.And truly that is the normal flow of markets that we've seen for decades.When the market gets shaky, money runs to bonds because bonds are considered safer.But right now we have competition for the money that would flow into bonds in mortgage backed securities.AI companies are now more and more competing directly with Treasuries and mortgage backed securities for the exact same investors.So money chasing AI is money that could have been buying mortgage bonds.So the question is, how will rates actually come down?What has to happen in order for that to be the case?Well, recently Treasury Secretary Scott Besson said that rates and bond yields will come down once the Iran conflict ends.Maybe some.If the conflict does stop, oil prices probably will calm down.And that gives us a little bit better rate environment.But compared to what?Right now we're at seven and a half.We going to get to six and a half.That's where we were a year ago.What most people are really waiting for is that 3 or 4% like the good old days.But I really don't see that coming back anytime soon unless it's artificial.And that means that the Fed would be buying mortgage backed securities again like they did in 2020.And if they do that, then we'll probably get a whole lot more inflation once again.So then where does all this go?Well, the way I see it, there are three things that'll get rates down in any real way.Number one, the government borrows less.But I wouldn't hold my breath on that one.Every presidential administration has promoted reduced spending and then gone on to spend more than the previous administration every single time.Number two, the Fed starts buying mortgage bonds again and we pay for it in inflation.You know, this way you will get lower rates.But that $400,000 house is now going to cost you 500,000 to buy.Number three, a real break in the stock market, probably tied to AI.Then money will run for safety into bonds.Which of the three is the most likely scenario?And it's good for mortgage rates, but it's bad for everything else in the economy.Now, none of these things you want to sit around and wait for because either you'll be waiting forever or the home prices will go up or a lot of people will be without a job.So stop trying to time the rate.You can't control it, nobody can.What you can control is the cash.So buy a house when the timing in your life calls for it and your budget allows for it.And one more thing.If you ask AI what rates are today, it'll tell you confidently and it'll be confidently wrong because it doesn't know your credit, your loan or your house.That is still my job, at least for now.All right, let's move on to our buyer.Tip of the week.So here's something that I've never understood.Buyers love getting the price of a home knocked down.It's like a badge of honor.They're saying I got them down 10 grand.And agents, they love it too.But let's run the math on the 10 grand.At today's rates, $10,000 off the price of the home saves you about 69 bucks a month on the payment, $69, that's it.And it would take you about 12 years of saving $69 a month just to add up to that same $10,000.Now take that same $10,000 and have the seller put it towards your closing costs.That 10,000 is in your pocket today on the day that you usually actually need it.You can use it for the move, the paint, the fence, or whatever the house needs.And here's one other piece.You can always change your rate later.If rates come down, and nobody can promise that, then you refinance.But you only pay for the house one time.So that badge of honor for the 10 grand price cut, just flip it around.Skip the I got them down 10 grand and go with, the seller paid me $10,000 to buy their house because that's actually what they did.Now, if you can get both a lower price and closing costs, awesome.But if you have to pick one, I'd pick the closing costs almost every single time.But no matter how many times I say this, people still offer the lower price first.I don't understand it, but it is what it is.So I'll just keep showing you the math each and every week.All right, let's move on to a little housing data for DFW.So if you only look at one number this month, make it this one.93.9%.That's how much of their original asking price the average North Texas seller got in September.So that means the typical seller is closing about 6% under where they started.And most of that is tied to starting too high in the first place.Now here's the rest of it for you, Metrotech.September 2026, single family home numbers.So there were 6,759 homes sold in September, and that's down 7% from last September.The median price was sitting around 385,000, which is down about 1%.The average price was around 509,000, and that's up about 4%.Right now we're sitting at about 62 days on market on average.And that's two days faster than a year ago.And we currently have about 4.3 months of inventory.But Mike, you ask, how does the median go down and the average go up in the same month?Well, it's which homes are selling.See, metrotech says their mix of homes that sold is moving the numbers around a little bit.So most likely higher end homes closed, which pulls the average up while the middle of the market drifts a little bit lower.And that is a really good thing to know if you need to adjust your marketing.Higher priced homes are moving more than lower priced homes.But here's another number that you should be paying attention to.Pending sales were down 19% last month.And those are the contracts that turn into closings over the next month or two.So the slowdown probably isn't done yet, at least not for the rest of the fall.And you can thank mortgage rates for that one for sure.And oh, by the way, it isn't just fewer buyers.New listings are also down 5% from last month and active listings were down 2%.So fewer people are buying, fewer people are selling, and prices are mostly flat.That is a transaction recession, not a housing crash.So what do you do with all this information?Well, if you're working with buyers, they have room.Sellers are negotiating, and that 6% is proof.And if you're working with sellers, price it for the market that we have today, two years ago, it's not coming back.And here's a tip on getting some of these numbers yourself.Pull the real report from your mls, or you can grab Metro Texas Monthly update off their site.Then you're going to hand it to AI and ask what changed and why you bring the data.AI tells you what it means.Look, a slowing market is survivable.It just means you need to know your numbers even better and dial in your marketing efforts.All right, next up, our seller tip of the week.So if you are selling a home right now in Dallas Fort Worth, here is what you're up against.Buyers have options.There are over 30,000 homes for sale right now in North Texas.So your buyer is probably looking at your house and a handful of others on the same weekend.So if you want to be the one that's easy to say yes to and stands out among the crowd, move in.Ready wins.Now, that doesn't mean a remodel.It just means the small stuff like paint fixtures and a clean yard and the thing that's been broken so long that you stop seeing it.But guess what?Buyers see it.And if you really want to be prepared for a picky buyer, get an inspection before you list.In Texas, the buyer's inspection usually happens during the option period.And that's exactly where deals get renegotiated or or completely fall apart.So if you inspect first, you and your agent already know what's coming.And you can fix a lot of it ahead of time or even just price for it and then have the answers ready when the buyer's inspector writes it up.So then you got no surprises on day five of that option period.Now, there is one caveat to this.Once you know about a problem, it must go on the seller's disclosure.If you're aware of something, then you have to disclose it.Now, you might feel better not knowing, but most inspectors are going to find it anyway.So it's better to know the size of the train coming at you than to stand on the tracks and hope for the best.So the goal is to fix what you can before anybody else finds it.And if that inspection report comes back 40 pages long, hand it to the AI, ask it to sort everything into a fix now, fix if asked, and leave alone.Then go over that list with your agent because the house that's easy to buy is the one that sells.Next up, we're gonna dive into my brain, if you're ready for that.So this is the part of the show where we peek inside this warp skull of mine and find out what I spend my nights doom scrolling about.Fair warning, my thoughts aren't very well organized.They never have been, but at least they can be somewhat entertaining.So with all that said, these are the things that I read this week and I just can't stop thinking about.Most of them have nothing to do with mortgages.So let's start with cars.CNBC says that car buyers are stretching loans out to seven years or more just to afford the monthly payment.An average new car payment right now is about $787 a month.And the average amount financed is a record 44,664 as about 7% interest.So seven years on one car and it'll be worth about $9 once you actually pay it off.And speaking of payments, the Federal Reserve says almost one in five families with debt was laid on a payment this last year.And that's the highest since 2010.And families more than two months behind over 8%.And that number was only 5% in 2022.So we're stretching car loans to seven years and we still can't make the payments.And payments to who, you might ask?Well, the wonderful banks, of course.The ones that run the world.And bank of America just got fined $1.2 billion for money laundering violations.They admitted to willfully violating the Bank Secrecy Act.And regulators say they failed to report more than $5 billion in suspicion activities.5 Billion.Meanwhile, I need a letter of explanation from my borrower for why a 400 Venmo landed in their account.Different game, different rules.And speaking of reporting, to the government.The treasury repealed the rule that made companies report who actually owes them to FinCEN.So the bank gets fined for not reporting and the shell companies don't have to report at all.And remember, we all worried about red team versus the blue team.But the powers that be all play on the green team and we weren't invited.And here's another green team nugget for you.Remember the tariffs.Well, those refunds are starting to roll out right now just to not you and I.The Wall Street Journal says that Apple got almost $2.2 billion back.Nike 986 million, FedEx about 800 million.And Amazon got about 640 million refunded.But don't worry, I'm sure that's going to show up as lower prices at the store any day now.Speaking of big companies with big money, since July, Amazon and Alphabet sold about $70 billion in debt bonds.Every other emerging market government combined sold about 45 billion half of what they did a year ago.So two tech companies out borrowed the entire developing world.That is the AI build out on borrowed money and that is competing with your mortgage for the same investors.Now onto the conspiracy side of my brain.Many economic commentators on the Internet suggest that the US has engineered a global dollar shortage on purpose.The energy crisis plus five years of inflation and eventually other countries have to start selling their reserves, the reserves that they hold in dollars.Now do I know if that's true?Of course not.But do I think about it way more than I should?Absolutely.Because so many things that we think are just crazy conspiracies keep coming up as being absolutely true.Green team strikes again.Now some good news.If you live in Texas, that moving money keeps coming this way because Wall street might have a new rival and it's right here in the Lone Star State.The Texas Stock Exchange is pulling companies, capital and financial talent right into the Lone Star State here.And it started trading back in July.So come on down and join the money boom.We got lots of houses.Just don't ask about the August weather.And speaking of Texas, Austin's property tax rate is up about 31% since 2017 and it's the highest in the last decade.So remember that the next time somebody brags that Texas has no income tax, the man is still getting his money just on your house instead of your income.All right, this next one has me a little more concerned than almost all of this.Betterment recently surveyed.Gen Z and found that 52% say they've moved money.They would have invested into sports betting.And about a quarter of those say that sports betting is part of their long term financial plan.Their long term plan.Look, I absolutely love sports, but I am not building a retirement on the over under.But that is what you get when every other ad on TV and YouTube is from DraftKings.Okay, last one.And you knew this one was coming.Congressman Eric Burleson.Yes, I said.Congressman Eric Burleson posted recently on X that our government agencies went back through every past UAP sighting, figured out what draws them in, and then recreated those conditions on purpose at a site with prior activity.So the odni, the CIA, FBI, and military intelligence all together in the same place.And in his words, something showed up.Then just last week, former intelligence officer Jay Stratton went on Fox News.Yes, Fox News with Brett Bear and said the world deserves the truth along with a bunch of other wild stuff.You should really check that interview out.Now, I don't know who or what showed up, but this is possibly the biggest story in the history of mankind and it still shows up as a footnote to mortgage rates and picking the right parlay on DraftKings.We live in some wild times, my friends.And that, folks, is probably more than you care to know.But welcome to my silly little brain.All right, moving on to our agent.Tip of the week.So listing agents, this one's for you.Your phone rings and it's the buyer's agent.She says, my buyer loves it, but they want $10,000 off the price.Now, before you talk to your seller, ask them one question back.Do they want to save 69 bucks a month on the payment or do they want $10,000 now?Because that is the real choice.10,000 Off the price saves the buyer about $69 a month at today's rates.$10,000 Towards closing costs is $10,000 in their hands at the closing table.Your seller nets the same either way.But the list price holds.And that matters for the appraisal.It matters for the next sell on the street.And it matters if the deal falls apart and you're back on the market or without showing a price cut in your history.And most buyer's agents just haven't run the math.Trust me, I know.So run it for them.One thing you do have to check first, though, how much a seller can actually contribute depends on the loan type for the borrower and the down payment.So have the buyer's lender or the buyer's agent confirm the number before anybody writes it up, but it's the same money and it's a better deal and nobody had to cut the price.And finally, our AI segment of the week, the listing that just sits.And you know that listing still there around day 40 something showings have slowed to a trickle.The feedback is nice house, but not for us.And then your seller texts you and says, what's the plan?Well, we all know how we likely got here.But just to review, the agent walks into the listing appointment with the data that says one number.The seller has a different number sitting in their head.The agent wants the listing and wants a happy seller.So they go with the seller's number because what are you going to do?Turn the listing down?Course not.But you also know what comes next.Showing momentum dies, it sits and then the price gets cut.And then when buyers do show up, they offer less than the price you just cut to.So today we're going to use AI and real data to build two things.The case you take to that seller and the plan for what happens next.So let's start with some data.Realtor.com looked at this exact scenario back in June.Homes that closed around the four week mark sold for 1.8% more than the average home.And homes that sat for eight weeks or longer sold for 1.3% less.That's about a three point swing just from sitting.And on a $400,000 house, that's $12,000.And here in North Texas, Metrocheck says that homes that sold in September average 62 days on the market and they closed at 93.9% of their original asking price.So the typical DFW seller right now is taking about a 6% hit under from where they started.And by the way, your seller needs to know this information up front because a stale listing costs your seller money every week that it sits there.But here's why it's a little easier said than done.Most sellers aren't clueless.If they bought five years ago, they probably know that the market isn't great for sellers right now.But knowing that and turning it into a number they'll actually list at are two very different things.And that is where you come in.And that's also where the data has to do the talking.So it isn't just your opinion against theirs.So let me tell you about a listing in Mansfield that I know pretty well.Great neighborhood, great schools, has a pool and it's sat.It's actually still on the market as I'm recording this.So I can't tell you really how it ends yet.But I can tell you how we built the case.We gave AI everything.The listing sheet, how long it'd been on the market, the price history, every showing comment, and the agent's own notes, what the buyer's agent said and what they could read between the lines when they didn't say anything.Then we gave it the updated numbers, a fresh MLS report of that neighborhood, what sold since the house was listed, what they sold for, how fast and how those homes were different from this one.And just so we're clear, you pull that data from your mls, AI can't go find it, or if it does, go find it.It's not the data that you need.And then you hand it over and your large language model does the sorting.So here's what it found.It gave us the answer in about 30 seconds.Every home that sold in that area moved in 30 to 60 days.And every one of them had the primary bedroom downstairs.Not one had it upstairs.But this one does.And that's basically why it's sitting.It's pretty obvious once you see it laid out like that, right?And that is what you put in front of your seller.The homes that sold since they listed, what they sold for, how fast and why.Now, one little tip here, spot check two or three of those comps yourself, because it feels like primary bedroom floor gets typed in by an agent.And agents can fat finger stuff all the time.We're all guilty of.So when we asked Claude what to do about it, two things came back.First, before you cut the price, offer seller concessions money towards the buyer's closing costs.Because in that case, the buyer gets real money and the seller keeps their list price, which matters for the appraisal and the next sale on that street.Because 10, 000 towards closing costs moves a buyer a lot more than 69 bucks a month off the payment.And if concessions don't do it, you still have the price cut in your back pocket, and that's move two or three.Now, most people do it backwards.They cut first, then throw in concessions when that doesn't work either.Second thing, stop marketing the house's features market to the buyer who'd actually want to buy it.And in this case, a primary bedroom upstairs is usually a problem for most buyers, but just a problem for some buyers, not all buyers.And that's the point.All the bedrooms upstairs means that the floor is your private space.Downstairs is for having people over, friends, parties or whatever.Or you could say it's for someone who works from home and Wants a work and life balance on separate floors.Add in the pool and you're entertaining outside also.So you write the listing to that buyer.And in this case, I got one thing exactly right.You describe how someone would use.Use the house.Never who should live in it, because Room to Entertain is great.Perfect for young families.Could get you a call from your broker.It's just a fair housing issue.And it applies to AI prompts, too.So how long do you give the next plan before the next move?Well, I say you look at days on market for the homes that have sold around you.If they're sitting at 30 to 45 days, honestly, I'd give it about that long.If your sellers have the stomach for it, of course.But that's one full cycle.Buyers who already saw it could possibly see it again with the new description.And new buyers are going to see it for the first time.I really don't think two weeks is enough right now because like I said before, we're in a transaction recession.We are not in a housing recession.Now recently reported that existing home sales are running under 4 million a year right now.And in 2021, it was almost 7 million.But prices are still up over last year and they're up 39 months in a row nationally.So the buyers are out there.There's just fewer of them and they take a little longer.So plan for that.And the best version of all this happens before the house ever sits.A good listing agent can spot the glaring problem at the listing appointment.Primary bedroom, upstairs, not updated.An investor who never put a dime into it.So you have the entire conversation right there.Here's plan A, here's plan B, and here's plan C. And here's when we move from one plan to the next.That way, on day 40, it isn't the first real conversation that you've had with your seller.It's the next step in a plan that they already agreed to.So if you want to set this up yourself, have AI automate your marketing and communications.It's really not that complicated.And I built all of this into the listing kit for my latest class.You load all of your files into AI at once.Then you just type it's sitting and the address.And it's going to ask you three things.It's going to want the MLS report for the neighborhood, the showing feedback, and your read on why it's sitting.And then it's going to hand you back two things.A relaunch plan for buyers and the conversation for your seller.With options and the numbers listed for each one.So the price decision stays with the seller.You just bring the numbers and if you want this kit, just shoot me an email or a text and I'll send you the link.But one thing before you go build it.AI doesn't know your market or you, unless you tell it.Feed it last fall's comps and it'll tell you about last fall with absolute confidence.But it doesn't sit at the kitchen table with your seller.You do.You're the one looking at that seller when the numbers aren't what they had hoped for.AI just makes sure that you walk in with the number structured in a way that anyone can understand.So listings sit because they get priced to make the seller happy.And every week they sit costs the seller money.So pull the homes that sold, find the difference, hand it to I offer concessions before you cut market to the buyer who wants exactly what this house has.And have a plan A, B and C. And talk to your seller on day one about each one before you ever get to day number 40.So that's it this week, guys.Mortgage rates are a debt story and probably will be for a while.If you're buying, then take the ten grand in closing costs over the ten grand off the price.And if you're selling, price it right from day one.Have a plan A, B and C before you need them.And if a listing is already sitting, pull the homes that sold, hand them to AI and walk into the seller conversation with numbers instead of opinions.If you want the listing kit, text me or email me and I'll send it your way.And if this episode helped you at all, send it to one agent who's got a listing that's sitting right now.Until next time, be good humans.Just keep grinding.Life is what you make it, so make it great.See you next time.