What Is a Real Estate Hot List?
A real estate agent often starts her day by browsing through the latest hot list, a report generated by the Multiple Listing Service (MLS) that shows all of her market's real estate activity for the last 24 hours. The hot list is instrumental for several reasons. It allows buyers’ agents to spot listings for their buyers almost as soon as they come on the market; it helps listing agents price homes they're marketing; and it helps all agents and brokers identify trends in their local markets. Some MLS systems allow agents to send customized hot lists automatically to their customers.
Each day's hot list shows all of the new listings that have come on the market in the last 24 hours. An agent may be able to customize the active-listing hot list to show only those properties that meet specific, predefined criteria, such as price, geographic location, number of bedrooms and other items that correspond with the agent's or his customer's preference. Customization capabilities depend on the MLS system the agent uses, but generally speaking, the system can display both the full active-listing hot list and any number of customized lists.
The hot list shows as "pending" any listings that have gone under contract in the last 24 hours. A pending sale is one for which an offer has been accepted and an agreement of sale executed. The sale hasn't closed yet. Pending sales are a useful forecasting tool, as they represent future earnings much as pre-orders do for retail businesses.
An expired listing is one for which the seller's listing contract with the real estate broker has reached its ending date without the house having been sold. Expired listings are off the market, but sellers often renew or extend their listing contracts. In some cases, they relist their home with a different broker. Agents and brokers use the expired-listing hot list as a marketing tool to identify potential customers who may be in the market for a new broker or agent. Expired listings serve as a pricing tool as well. Agents assume that the primary reason a home failed to sell is because the price was too high. They know, then, that prices of comparable listings should be lower.
A hot list's closed sales are those that closed, or were completed, in the last 24 hours. Ownership has transferred from seller to buyer, and the buyer's mortgage loan, if he is financing his purchase, is in effect. In addition, monies associated with the transaction, like broker commissions, taxes and other closing fees have been paid and are in the process of being disbursed by the closing agent or attorney who handled the closing. Listings for closed sales show the closing date, the final sale price and the value of any concessions the seller made on the buyer's behalf. Agents use these data in the comparative market analyses they perform to determine the best list prices for new listings. The closed listings' value in this regard lies in the fact that the most objective predictor of a home's sale price is the recent sale prices of similar homes in the same area.
Withdrawn and canceled listings are those whose owners took them off the market before the end of their listing contracts, without the properties having sold. Sellers withdraw and cancel listings for any number of reasons. Some decide against relocating, for example, while others run into financial problems and are forced by their lenders to take their homes off the market as a prerequisite to refinancing or modifying their mortgage loans.