Local market knowledge is the expertise that moves a sale price, so build your business where you've already sold

By Liv Saville, Head of Growth at Worthington

Market knowledge·October 20, 2026·6 min read

A 2024 study in Real Estate Economics by Lu Fang and Darren Hayunga found that the agent expertise that mattered for a home's sale price was local market knowledge, tied to how close the home sat to where the agent had recently sold. My view is that agents should keep their listings and their past-client nurturing concentrated in those same neighbourhoods.

Sale prices tracked how close a home was to where its agents had recently sold

If you were asked to prove your expertise to a seller, the easiest numbers to reach for would be your years in the business and how many homes you've sold lately. Fang and Hayunga set out to test which kinds of agent expertise actually show up in a sale. In The Impact of Real Estate Agents' Expertise on House Prices and TOM, published in Real Estate Economics, they investigated whether agents' expertise affects two basic market outcomes: the transaction price and the marketing duration, meaning how long the home takes to sell.

The authors describe a primary contribution of their article as examining three knowledge categories together, for both listing agents and selling agents. They report that "instead of the length of agents' license periods or recent transaction volumes, the results demonstrate that the important expertise category is agents' local market knowledge."

They consistently found that the economically important determinant of transaction prices was the distance between the home being sold and the agents' micromarkets where they had conducted recent transactions. Agents with tighter market concentrations increased prices, and the authors report the reverse for agents working unfocused micromarkets.

Fang and Hayunga also looked at time on market and found that agents' expertise levels did not materially alter marketing durations. In their data, expertise went with the price a home sold for and left the time it took to sell largely unchanged.

Recent sales nearby give an agent knowledge a licence date can't

The authors report the pattern, and the explanation I'd offer for it is my own. An agent who has recently sold homes a few streets away knows what buyers in that pocket have actually paid and what they were paying for, and that knowledge goes straight into how a home is priced and presented. A licence date or an annual sales total can be earned anywhere in a region, so neither tells a seller whether you know their street.

The concentration finding makes sense to me for the same reason. An agent whose recent deals are spread across a wide area has less recent, close-by experience to draw on for any one home, and the study found prices went the other way for unfocused micromarkets.

The limits are worth stating. This study measured sale prices and marketing durations. It didn't study client relationships or referrals, so when I connect it to nurturing past clients below, that's my own reading. The time-on-market result is also a useful check on how far to take it: in this study, local expertise didn't buy speed.

How to put local market knowledge to work this month

Map where you've actually sold. Take your closed deals from the last couple of years and mark each one on a map. The clusters you see are the closest thing in your own business to the micromarkets the study describes, and they may be tighter or looser than the area you'd call your patch. That map tells you where your knowledge is freshest today.

Lead your listing conversation with nearby sales. When you prepare for a listing appointment, pull up the homes you've recently sold close to the seller's and what you learned from each, and spend less of the meeting on years licensed or total volume. In this study, local market knowledge was the expertise category that mattered for price, so it's the strongest part of your case to make.

Be careful about promising speed. Fang and Hayunga found expertise levels did not materially alter marketing durations. I wouldn't tell a seller that your local knowledge will sell their home faster, because this research gives you nothing to back that up.

Weigh listings far from your clusters honestly. The study found the reverse of the price effect for unfocused micromarkets. When a listing comes from an area where you haven't sold recently, consider referring it to a colleague who has. If you take it, I'd put real time into studying recent sales near the home before you set a price.

Nurture the past clients who live in your clusters. These are the people already living on the streets where your knowledge is strongest. My view is that keeping in touch with them through the year is one of the most natural ways to keep doing business in those neighbourhoods, because their own next move and the neighbours they talk to are both close to home.

Your past clients already live where your knowledge is strongest

I think of an agent's best neighbourhoods and their past-client list as closely linked, because every home you've sold leaves a client living in one of your micromarkets. This study says nothing about nurturing, so the link is my own reading: staying in touch with those clients keeps you present in the areas where your recent sales give you an edge, and the study connects that kind of edge to price.

That steady contact is the part that slips when live deals take over. Worthington keeps you top of mind with past clients month over month, year over year, and each suggestion comes with a reason the client would recognise, like the anniversary of their purchase. For news like an open house, Worthington picks who would care and why, you untick anyone you'd rather leave out, and he writes one note each for you to review and send.

Doing your deals close together builds the kind of knowledge that, in this study, went with a better price, and the clients you've helped in those neighbourhoods are the reason to keep showing up there. Keep both concentrated, and the case you make to your next seller gets stronger with every sale nearby.

Worthington draws on research like this to shape a nurturing strategy for each of your clients. Join the waitlist