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  • October 1, 2006 at 9:50 PM #7655
    powayseller
    Participant

    More good advice from realtor Jim Klinge. If someone needs to sell, they ought to interview and SD Realtor (Adam Rappaport)for the listing, because these guys understand how to position a house for sale in this market. It’s so important to list with a realtor who understands this market, who is not just in denial (like the realtors who got the listings in my neighborhood that are still sitting after 8 months).

    “If nobody is buying your house, it’s because your price is wrong.

    If your price was right, somebody would buy it. There are still plenty of sales happening, and plenty of buyers on the sidelines, waiting.” – Jim Klinge

    Jim predicts by November, his areas will have 1700 listins and 100 solds. Is that enough to convince these sellers to get it right on the price?

    October 1, 2006 at 10:46 PM #36985
    barnaby33
    Participant

    No probably not, lest they wouldn’t have reached that inventory number in the first place. I realize the answer is a bit pendantic, but the question seems pure rhetoric.

    Josh

    October 2, 2006 at 1:19 PM #37033
    MH
    Participant

    I think – based more on assumption than personal research – that many of those sellers are simply UNABLE to lower their price.  If you bought a house for $750k and put 5% (37.5k)down, even if the market stayed flat you'd still owe at least $7,500 to get out from under it (assuming 6% commission).  Now, if you put down < 5%, took out a HELOC, add in the other seller's costs, or have the property drop by a percent or two, pretty soon you've got to come up with a lot of "right now" cash to pay for it.

    That, I suspect, is the reason for the inventory build-up.  That's also why I think this will go on for some time… those that can sell (have equity) might go ahead and do so, but think that many others might well end up turning theirs into rentals to avoid bankruptcy.  At least that way they could write it off and wait for better times (don't hold your breath).

    What I don't know – is how short-sells will factor in.  IF you short-sell, I assume that shows on your credit rating, no?  Is that significantly different than declaring bankruptcy in terms of final result?

    October 2, 2006 at 1:38 PM #37036
    BikeRider
    Participant

    I think I read that the main concern with the short sale is that the seller is still responsible for paying taxes on the money the bank forgave them. Right? The bank basicaly lets the seller off the hook for some amount of money. But, the seller is still liable for the taxes on that, which could be substantial.

    ABOUT has info on the short sale.

    http://homebuying.about.com/od/4closureshortsales/

    Exerpt-
    “Be aware the I.R.S. will consider debt forgiveness as income, and there is no guarantee that a lender who accepts a short sale will not legally pursue a borrower for the difference between the amount owed and the amount paid. In some states, this amount is known as a deficiency. A lawyer can determine whether your loan qualifies for a deficiency judgment or claim”

    “Now if everything goes well, the lender will approve your short sale. As part of the negotiation, you might ask that the lender not report adverse credit to the credit reporting agencies, but realize that the lender is under no obligation to accommodate this request.”

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