[quote=eavesdropper]
While I do firmly agree that the “worth” of a property is what someone is willing to pay, I don’t believe that this is the dynamic at work when a lender preemptively sets a price that is far below most of the recent sales in a neighborhood. And forcing appraisers to cherry pick sales is not a way to “normalize” the market – no more so than when it was done when prices were on the upswing.
Sorry it took so long for me to state my concerns. I really should do this during the day, instead of 1 am, when it takes me 5 times as long to form a cogent argument (or perhaps not quite cogent).[/quote]
Trust me, if the house is worth $400K (or more) and the lenders are listing it for $300K, they will get multiple offers in the $375K to $425K range. I’ve seen this over and over and over again this past year. However, if the lenders are listing homes for $300K, and other hopeful sellers are listing for $450K (and not selling within the first 60 days), then it’s the lenders who are getting the prices right, while the “regular” sellers are having a difficult time coming to terms with the real market values of their houses.
It’s very difficult to have an “underpriced” sale **as long as it’s an open-market sale.** There have been plenty of buyers out there in the San Diego area. I see them swarming new listings all the time. There are flippers, organic buyers, and people who want to become landlords; and they are all competing for the very limited inventory on the market right now.
This is NOT a slow market. It’s been on fire since about February 2008, and it’s been gaining steam throughout 2009. The only slow period was the second half of 2007, and even then there was plenty of activity if a house was priced right (we had to sell a few properties during that time, and sold everything fairly easily because we weren’t wed to a particular price). If I were a potential seller, I’d be listing right now. This is a seller’s market, not a buyer’s market.
