August 17, 2006 at 11:25 PM #7235powaysellerParticipant
VCJIM suggested a poll. Once I started asking the question that we all agreed on, people were puzzled and I had to rephrase it to: Do you think home prices will rise or fall, and for how long?
I asked 10 people.
8 said prices would fall and take off again in the spring.
2 said prices would fall for 2 years and take off again at the next presidential election.
3 of these 10 are new to piggington and may be reading this tonight 🙂
The funniest answer: “Don’t buy, don’t sell”. Buyers should wait for lower prices, and sellers should wait for a rebound.
Everyone had stories of neighbors and friends whose homes languished on the market for 8 – 18 months. But a general feeling is that this is temporary, prices go up in the long run.
Based on this, how many sellers are waiting for the spring selling season?August 17, 2006 at 11:46 PM #32286SD RealtorParticipant
I know of 3 sellers who will be relisting in the spring.August 18, 2006 at 12:08 AM #32291powaysellerParticipant
OK, so in the spring our inventory will double to 46,000, putting even more downward pressure on prices.
What would make the buyers come off the fence in the spring? The mood is turning darker among the buyers, and we’ve discussed the role of psychology.
Better sell now, before prices drop further.
What are those 3 people thinking? Or smoking? Is it that south-of-the border stuff or the good stuff from up north (just quoting another forum member from earlier today…)August 18, 2006 at 10:15 AM #32335PerryChaseParticipant
I talked to a friend a few days ago. He said that he’s going to fixed-up his house some more to get it ready to relist in the spring.
He’s not a very good friend, otherwise I would’ve told him about the bubble, Piggington and SD Market Monitor.
I’ll be watching the spring #s carefully.August 18, 2006 at 1:24 PM #32341JESParticipant
I couldn’t be happier. I sold in Feb/March of this year and at that time there were no other homes for sale in our area. Now there are 12+, all discounted, none pending and panic has set in. But enough boasting about me, allow me to instead consider what I would do if I were them.
Two things make sense to me, depending on the situation. First, hanging in there has merits if you plan to stay here long term and can make payments even if it gets ugly.
Otherwise I would list it right now and price it 10% below comparable homes. Homes are still selling and if you are in the lowest say 10% of similar homes (location, sqft., etc.) I assume you’d have a good shot. I would tell people I’m selling because of a job transfer and I would market the value of the house by comparing the house to previous comps which are likely 10%+ higher than my price. I would go with a realtor I know who charges 1% if I find a buyer and 2% if he does, and offer 2.5%-3% to buyers realtors. I would have open houses every weekend day from 10-6, and weekdays too if I had time, and do most of them myself. I would hope to find unrepresented buyers and I would sell them hard on the fact that I can go even lower for them since I wont have to pay for a buyers side realtor. EG: I would immediately offer to split that 3% with the buyer, and I would even offer to pay $1,000 for them to have a real estate lawyer of their choice look over the paperwork if they have concerns about using my realtor.
For a 700k home that 90% of people out there are trying to sell at near full comp prices, I would list at 630k. And if I found a buyer without a realtor they would get an additional 10k off.
Unless of course homes were selling in my area, in which case I would shoot higher.August 18, 2006 at 1:37 PM #32342SD RealtorParticipant
Poway I agree with your statements.
However my job is to give people my opinion, and the honest truth.
So it is my opinion that you are 100% correct. I do think there will be an inventory explosion, and I do not think buyer psychology will change.
That is my opinion but not fact.
Now what is a true fact is that real estate has cyclical trends within secular trends like any other market. So yes it is absolutely in a secular downtrend however, the strongest cyclical component in real estate is the spring.
It is backed up with hard data and it is my job to point that out.
Now I DO BELIEVE that slashing pricing now and getting out sooner then later is better. However it is only my opinion but I do tell them that. Also they get lots of other information from other Realtors who may be more optimistic about the spring then I am.August 18, 2006 at 1:59 PM #32345sdrealtorParticipant
It’s easy to say that is what you would do today yet much harder to actually do it. Then again its not your problem as you were fortunate to get out before the mess started in earnest.
SDRAugust 18, 2006 at 2:14 PM #32346no_such_realityParticipant
I agree SDR, if you can absorb the additional 10% cut on asking price and subsequent negotiation cut, odds are your in good enough shape to weather the store to make transaction costs outway the benefit of doing it.
If you bought 2005 you probably can’t absorb the cut and get out without a loss. In 2004, you may be breaking even. If back in 2003, well, free taxes helps, but housing has a ways to go to make it worth that kind of reset.August 18, 2006 at 2:16 PM #32347JESParticipant
You’re right, one thing I would still do is use a realtor though. And I would definately be aggressive if my intention was to sell in this market. I would want potential buyers to think, “Wow, I know that the market is soft right now but look at this deal.”
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