[quote=CA renter][quote=CONCHO]For example, if a foreclosure appraises at 500K but a shrewd buyer negotiates a deal at 400K, a follow on buyer for a similar house will baseline his purchase price at 400K, not the correct 500K. In effect you have a circular death spiral in home prices to the benefit of the buyer.
Funny how no one complained about it when it was working the other way around. In a neighborhood of $400K houses, whenever any house on the block sold for $500K, everyone on the block was immediately $100K richer and would tell you all about it every chance they got. I guess it’s just not as much fun on the way down :-([/quote]
Funny! That’s the first thing that came to my mind as well.
When fraudulent transactions and no-down, neg-am loans were used by speculators with no skin in the game, the rising prices of comps were “based on fundamentals.” When prices drop as this fraud is wrung out of the market, somehow prices are “below market.” Funny how that works…[/quote]
There are many unwilling participants of this wild roller coaster ride who view a primary residence as a place to raise a family, not an investment. It is a reasonable expectation to sell at a price consistent with historical norms when life circumstances dictate. Moreover, it is understandable if not expected, to reject offers 100K-200K below historical norms. No one is asking to sell at inflated prices. Schadenfreude and other undesirable traits may obscure this very basic and obvious point.
Many will agree that all is fair in love and war and real estate investing. I do not envy folks who made a killing riding the bubble, nor do I have sympathy for those who purchased at the peak and lost everything. These are risk reward consequences of free choice. I pass no judgment on those that knowingly and eagerly sold an overpriced asset at the peak to a naive buyer. Some may call this an immoral act. However, I do find it insincere that the same people now have the audacity to complain that the same overpriced asset is not depreciating fast enough for their liking because they’re tired of renting coupled with the desire to make a second killing. I don’t personally know any of these nefarious people, does anyone?
Regarding our realtor, we picked that person simply because enough information and choice presented itself to make a decision. No need to complicate the process and fall into an analysis paralysis trap.
