A different kind of Tsunami

[sdduuuude]

So I was looking at Redfin the other day, looking for interesting plots of land. Just for fun, I typed in “Rancho Santa Fe” and looked at everything for sale – houses, land, condos, etc.

It came up with 136 results !!!! Just in Rancho Santa Fe alone. Pretty much everything was over $1M, with a couple up in the 9M +/- 1M range.

Much has been said about the foreclosure tsunami, which I don’t really see coming as an actual tsunami, but does anyone else see this as a high-end inventory tsunami? I don’t really know this market, but 136 homes for sale in RSF seems extraordinarily high with 5 sales in August 2011. Anyone? Anyone ?

This has to affect the health of the markets underneath it.

By the way, back in 2003 or so, I remember running a search in my area (92117) as my parents were thinking about moving here. There were 11 SFR homes for sale. Today there are 116.

Again – seems “tsunami-ish” even without the mythical foreclosure event.

[UCGal]

To quote Jim the Realtor: “Nothing price won’t fix”.

I think a lot of homes listed in RSF or Clairemont would actually go pending or sell if they were priced more appropriately.

A lot of sellers out there still listing with “wishing” prices. Well priced homes DO sell. No matter the zip.

[sdduuuude]

Yes – nothing price won’t fix. Agreed.

I guess that is the difference between the foreclosure tsunami and the private seller tsunami. The private sellers will hold out for an unreasonably high amount while the banks will just sell it.

Still, the number of people who want to sell is very telling, methinks. The burden of making monthly payments for a house priced x on a house worth 0.7 * x is starting to take its toll and there truly is no way out. The future implications to the economy are bad.

People will either continue to divert funds (that could otherwise go into the economy) toward paying off that debt; sell the house at a loss; or get foreclosed on.

Different people have different pain thresholds/timelines and so the pain gets spread out over a long time.

So, the private seller tsunami isn’t really a tsunami. Just a slowly rising tide.

[UCGal]

[quote=sdduuuude]Yes – nothing price won’t fix. Agreed.

I guess that is the difference between the foreclosure tsunami and the private seller tsunami. The private sellers will hold out for an unreasonably high amount while the banks will just sell it.

Still, the number of people who want to sell is very telling, methinks. The burden of making monthly payments for a house priced x on a house worth 0.7 * x is starting to take its toll and there truly is no way out. The future implications to the economy are bad.

People will either continue to divert funds (that could otherwise go into the economy) toward paying off that debt; sell the house at a loss; or get foreclosed on.

Different people have different pain thresholds/timelines and so the pain gets spread out over a long time.

So, the private seller tsunami isn’t really a tsunami. Just a slowly rising tide.[/quote]
Interesting analysis. And it fits what I’m seeing.

I’ve seen a lot of houses go on/off the market with only inconsequential drops in price. A lot of denial about what the market is – and enough desire to sell that they keep their houses on the market. (Lets face it – keeping a house “on the market” clean is a PITA – so you wouldn’t keep relisting if you didn’t feel some pressure to sell.)

[sdrealtor]

While I dont follow it, every time I have looked in RSF since as long as I could remember the inventory has been about 2 years worth or more. Its just the way that market is. Much more for sale than selling.

[CA renter]

[quote=UCGal][quote=sdduuuude]Yes – nothing price won’t fix. Agreed.

I guess that is the difference between the foreclosure tsunami and the private seller tsunami. The private sellers will hold out for an unreasonably high amount while the banks will just sell it.

Still, the number of people who want to sell is very telling, methinks. The burden of making monthly payments for a house priced x on a house worth 0.7 * x is starting to take its toll and there truly is no way out. The future implications to the economy are bad.

People will either continue to divert funds (that could otherwise go into the economy) toward paying off that debt; sell the house at a loss; or get foreclosed on.

Different people have different pain thresholds/timelines and so the pain gets spread out over a long time.

So, the private seller tsunami isn’t really a tsunami. Just a slowly rising tide.[/quote]
Interesting analysis. And it fits what I’m seeing.

I’ve seen a lot of houses go on/off the market with only inconsequential drops in price. A lot of denial about what the market is – and enough desire to sell that they keep their houses on the market. (Lets face it – keeping a house “on the market” clean is a PITA – so you wouldn’t keep relisting if you didn’t feel some pressure to sell.)[/quote]

Yep. Still lots of delusional sellers with their wishing prices out there. We’ve also seen a lot of people who have been listing/desliting for a few years. They are “waiting for the market to come back.” Unfortunately, what they’re really waiting for is the bubble to come back, and that is very unlikely to happen in their lifetimes. It’s amazing how long some people can live in denial.

Of course, the media is largely responsible for this level of ignorance. They’ve gone from calling the housing bubble a “bubble” to calling it a “housing boom.” They don’t explain that the “foreclosure crisis” is a DIRECT result of the high housing prices; instead, insinuating that the “foreclosure crisis” could somehow be solved by higher prices! Someone has told them to change their talking points, so we’ll probably have to live with the ignorance for a few more years.

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