A lot goes into pricing a home: location, size, and upkeep are all things that realtors take into consideration.
More and more, realtors are also using marketing psychology to price homes. Local traditions and superstitions are also considered when determining an asking price.
Ninety-six percent of home prices end in zero, and 91% end in a double zero. The most popular last non-zero digit is nine and 53% of home prices have nine as their last non-zero digit.
Jed Kolko, chief economist at Trulia, explains that sellers use the number nine in their prices to make homes appear cheaper. This concept is not unique; it's why .99-cent stores are so prevalent and why an item is more likely to cost $9.99 than $10.
The number nine tends to appear most often in homes that have been discounted from their original asking price.
"If a seller or their agent has decided to reduce the price of a home because it hasn't sold yet, they're more likely to throw a nine into that price to help signal the bargain," says Kolko.
More expensive homes tend to skip this trick."When you get above a million dollars, there are a lot less nines in the prices," Kolko tells The Daily Ticker. "Sellers clearly think that a buyer is not going to be fooled into thinking a $3,000,000 house is a deal if it happens to be priced at $2,999,999. "
Just as the thirteenth floor is often skipped in apartment and office buildings, and Friday the 13th is thought to be an unlucky day, home sellers tend not to include that number in their price.
This slot-winning combination is three-times more likely to appear in an asking price in Nevada (home to gambling meccas Las Vegas and Reno) than it is anywhere else in the country. The single-digit seven is 37% more common in Nevada than in other states.
"That's a huge difference," says Kolko. "It was even more than we expected actually."
3:16 vs. 666
It makes sense that 316 is a common occurrence in Bible Belt asking prices since John 3:16 is one of the most popular bible verses. The prevalence of 666, which is generally known as the numerical representation of the devil, is a bit more perplexing.
"Triple six is a series of numbers people know and people notice that," says Kolko. "I don't think people are throwing a triple six in their home price by accident."
Twenty-seven percent of homes for sale in the Bible Belt have 316 in their asking price while 666 is 39% more likely to show up in a home's price in the same region.
8 Is Great
Eight is a significant number in Chinese culture; it signifies prosperity and good fortune. This is evident in the asking prices of homes in neighborhoods that are predominantly Asian American. Eight may be the last non-zero digit in 4% of all homes for sale, but it is the last digit in 20% of Asian American homes for sale. That's five times more often!
The Bottom Line
"Sellers and their agents clearly know what they're doing," says Koklo. "They know their audience, the know the buyers, and they know what to signal. The fact that we see numbers show up in certain parts of the country, that's not just to be cute. Sellers and their agents are pricing homes to sell and it matters locally."
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