Here’s an anecdote from downtown. I apologize if this is a semi-threadjack.
I bid on a condo that I really wanted. Top floor of a mid-rise, great view of the bay and downtown, perfect size. Without getting into too many details, the list price was 60% off peak, about 9x current annual rents. I made a cash bid 10% above the list price… and lost. There were 18 other bidders. So, now me and 17 others will continue to look at other places. We’ll all buy (in my case, again – I already own a place that I’ll rent out) eventually.
My point is that at the right price, there’s TONS of demand out there. The problem is – as we all know – that most of the inventory is priced too high. Which is why sales are slowing. At the trough last year houses were reasonably priced in aggregate, particularly considering where rates were (are), and sales were strong. Now they’re too high again. I think if rates remain low, we’ll see increased home sales as prices fall (again).
