“JJ, my overvaluation is based on economic fundamentals not on comps. It’s based on the trendline for the last 20 yrs. It’s based on the fact that there are absolutely no supporting factors to support the 120%+ price appreciation for the region in the last 6-7 yrs. And last but not least, it is based on the fact that carrying costs for a mortgage are approximately twice as much as renting the equivalent property ;-)”
That’s an example of “what should be” type of thinking, not “what is”. Based on the economic fundamentals, I agree with you that the pricing structure for the entire region is not supported or sustainable. However, within the context of the sales activity that is actually occurring, the price for this particular property may be a very reasonable starting point. For all I know, the list price might even be representative of the current market value of the property. Or not.
My point is that while we may be waiting for “what should be”, by definition what should be….isn’t.
