- This topic has 47 replies, 24 voices, and was last updated 18 years, 1 month ago by PerryChase.
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September 8, 2006 at 11:37 AM #7445September 8, 2006 at 12:20 PM #34689PerryChaseParticipant
I would say let them make their own mistakes. Wish them good luck and be there to listen when it crashes.
I have a friend in this situation. I just smile and tell them how great their house is.
Providing real estate advice (or financial advice in general) is like providing relationship advice. It’s a no win proposition. They hate you if you’re right and they hate you if you’re wrong.
September 8, 2006 at 12:28 PM #34693bob007Participanti agree with perrychase
September 8, 2006 at 12:41 PM #34695sdrebearParticipantI'm doing the same thing unfortunately. I'm watching 4 direct neighbors chase the market down.
Two (with the largest townhomes in the complex – 3 bd, 3 ba, 1,500 sq ft) have been trying to sell since spring. They are direct neighbors to eachother (share a wall) and are now in a price dropping war of sorts. Both started in the $450k range. One dropped to $425 after 3 months. The other held (it's a bit nicer). Then the $425k dropped to $395 (bottom of a "value range" of $395 – $415, ummmm… ok) Still no sale 6 months later (guess nobody saw the "value"). The neighbor (nicer place) finally dropped to $435k and now with a magic marker on the flyers (even the flyers won't sell) $425k. They obviously believe their granite counters are worth $30k more than the tile ones in their neighbor's place.
We then had two new places go up in the last month. One is a 3 bd, 2.5 ba with approx 1350 sq ft. They want $395 too. I guess they aren't watching their neighbors. View of the pool, but that's about it.
4th seller is a 2 bd 2.5 ba. It’s the exact same place I'm renting for $1,550/mo (yes, I think even that’s too much when you can get a full house for about the same in this area). He’s trying to sell for $360 – $380. Getting there, but probably needs to be in the $325k range for a quick sale (at least below $350k to catch more people looking “up to $350k”).
First month on the MLS and they've had a few lookers, but no one even close to making an offer. I've been there nearly 7 months now and nobody has sold a unit. One person even took his off the market and rented it out. That was back in April.
This is in Mira Mesa, by the way. Across from a brand new condo conversion which is also seeing vertually zero sales over the past 7 months. I expect to see the "Rent Now" signs replacing the "For Sale" signs over there very soon.
September 8, 2006 at 12:42 PM #34694JESParticipantI don’t talk about real estate anymore with family and local friends. If they own, they don’t want to hear about it, especially if you have cashed out like many of us and are presumably waiting for prices – their home prices – to fall. If they are selling, I also avoid getting in the middle, although I will make a few remarks about the current market conditions, some ideas, and then I shut up. If you tell them to lower the price, and they sell, they may hold it against you that they could have gotten more. If you advise that they keep the price where it is at, and they don’t sell, well, you get the point.
Since I cashed out earlier this year I’ve had a number of awkward conversations with family and friends about real estate, and most of the time they are completely close minded about what is actually happening. It’s purely psychological IMO. I tried referring a few to piggington, but noticed that they never checked out the site. Ironically, even if this thing crashes hard like many of us predict, I wont feel vindicated in any way, and I suspect that nobody will say that I hit it on the mark. If you cashed out you’re now an outsider, like an American citizen who leaves the country to gain citizenship somewhere else. Don’t expect that you can come back to the 4th of July parade, wave the American flag, and have everyone be happy about it. Very unusual situation I never thought I’d find myself in when I decided to sell. But I am content to let the chips fall where they may, try to help those close to me in subtle, non-offensive ways, and swoop in like a shark either here or elsewhere when everything hits the bottom!
September 8, 2006 at 12:48 PM #34697JESParticipantGood stuff sdrebear and I bet you are glad you are renting!
It’s clear to me that buyers don’t care about minor price reducations of 10, 20, even 30k right now and are only buying when sellers make huge discounts. Walk into the models at San Elijo and you will see that the new homebuilders have picked up on this and they are offering 100k+ discounts and financing just to unload properties. Will be interesting to see what happens here since many people need to sell!September 8, 2006 at 12:49 PM #34698JWM in SDParticipantI disagree about talking to to people about the state of the RE market in SD. It’s been dogma for too San Diegans for too long now. Time to burst their bubble(pun intended). Why you ask? Because somebody has to squash this nonsense out of the public consciousness and wake them up. They don’t like, then tough shit. It’s time for So Cal to stop living in fantasyland and I have no qualms about faciliting the end of this mass delusion or Housing Psychosis that we’ve been living in for the past 5 to 10 years. The FBs have to learn somehow, and if my prodding can amplify the message that your house is not supposed to be your retirement plan, then why not openly discuss it?
September 8, 2006 at 1:16 PM #34700RomanParticipantI couldn’t restrain from not putting my 2 cents into this subject. Talking about giving financial/RE advice to friends/family is a sure bet to make new enemies. People love to ignore the problem, and I do admire them for that. And DENAIL/IGNORANCE is bliss.
I’ll keep my story short, but for the 3 day long weekend (Labor Day weekend), I’ve had a couple frieds in town from Sunnyvale. They’re great people and highly educated (I mean they’re are both PhD’s in their fields). Talking about rocket scientists…..one of them is indeed that. Needless to say, the couple purchased a home after their school and got great jobs in 2004.Purchased a house for about $550k, and one mentioned (the guy)over the weekend that the house has appreciated more than their sallaries …..aka now on zillow about $740k (4 beds, 2 bets…aprox 1444 sqf..old house).
Anyway, since the subject came up, WHY am I still renting….and I’ve made my argument with my expectation of prices further declining, with a smile on my face.
CONCLUSION: you could sense the reaction and the comeback that….”I don’t think prices will fall”..I mean, even the MOST educated “yes, rocket scientist” are in denial. What could we expect from less educated & comon folk? Not much…..just to ride the market down to reality. In fact, I’ve read a great story from Asian news on US RE market, and it was called “UNREAL ESTATE”…..LOL
September 8, 2006 at 1:17 PM #34704CAwiremanParticipantPoway seller,
As always, good post.
By the way, the link to the 1st property in your post is no longer available on Zip. I wonder what happened?
Did the listing time out or did she pull it off the market?
Or, did it….. sell?
September 8, 2006 at 1:24 PM #34707powaysellerParticipantoops, sorry, it expired and she relisted it last week, so the first link didn’t work, but I gave the new link. Now, just a couple hours after looking at it, I can’t find it on ZipRealty at all….hmm, did it sell?
September 8, 2006 at 1:49 PM #34714BugsParticipantSeveral households in my wife’s extended family are involved in RE in one way or another. Including ours. Over the weekend I had a conversation with one of my brothers-in-law, who is a landscaping contractor. I gave him the “piggington lite” version of it and told him that many people currently involved in RE and construction and related occupations were going to be struggling. I wasn’t trying to scare him but I could see the wheels turning in his head. By the time we were done, there was some talk about diversification. Mission accomplished.
I didn’t bother discussing the subject with the other relatives. They’re not ready to consider how fragile their positions are just yet.
September 8, 2006 at 2:48 PM #34727JWM in SDParticipantFamily members are one thing, but I have no qualms about discussing it with a stranger. For example, I was at a Padres game several weeks ago and struck a conversation with a woman after some exchanges about the half completed condo building peeking out over the top of the stadium. Of course her response was, “I don’t think prices will go down because too many people want to live here..” I brought up the census stats on 40K people leaving SD county as well as the difficulties many companies are encountering in recruiting people to move to SD because of the high cost of living. I got the glazed look and the conversation ended there…but the seed was planted.
The only place I don’t bring it up at (unless it’s a fellow bear) is the workplace. I suspect several of the senior managers are FB’s.
September 8, 2006 at 2:51 PM #34728AnonymousGuesthalf completed condo building? which one? lol
September 8, 2006 at 2:54 PM #34729anParticipantI stopped discussing it with friends who are still bulling/hopeful and have position in RE. I treasure their friendship, so I don’t want to ruin that. Like someone said earlier, giving RE/investment advice is like giving relationship advice, it’s a lose/lose situation, especially if they’re not ready to accept it and you’re pushing it down their throat. I only talk about it to people who are at least open to the idea of RE bubble. As soon as I sense pressure, I back off. No point in making enemies. I’ve been following many townhouse and SFH in Sorrento/Mira Mesa area and I see many chasing the market down too. It’s actually quite fun to watch :).
September 8, 2006 at 3:01 PM #34730ChrispyParticipantMy cocktail party warning system (ie, talking to strangers):
Before I broach the subject of RE, I ask the person if they are a friend of Ben Jones or Professor Piggington. If not, then I ask what they think of David Lereah, real estate agents, mortgage brokers… any of the above. Once I get a reaction I go from there, but if I get NO reaction or familiarity with what’s happening, I change the subject.
I did manage to give my opinion to a friend who recently sold a rental property on the East Coast. After much discussion with me and others, and looking at available properties to do a 1031 exchange with, she and her husband decided it was preferable to pay cap gains then buy something in today’s market.
Not only will they be able to buy something better and cheaper later, their money will not be all tied up in the meantime. I felt that giving a “gentle” opinion in this instance was helpful.
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