Price war on my street

[powayseller]

I’m witnessing a price war on my street. Three 1875 sq ft townhomes, 3/3, adjacent to each other. 3 listings , #3 is first, #2 is second, #1 is last.

#1 listed February, $540K, reduced after several months to $530K. Vacant and listed by heirs (owner died in house).

#2 is a corner lot, listed end August. Even though #1 did not sell at $530K, #2 thinks his backyard is so good (all 50 sq feet of it, LOL), that he’s asking $540K. Reduced one month later to $530K.

#1 expired and relists in September. They realize that #2 is now a competitor, so they set the new listing price at $499K. DOM shows the nice low number…

So far so good. #1 is motivated, because it’s an estate sale, but they can take their time. #2 would like to sell to cash out and move someplace cheaper, but they can wait it out. Both seem to think the market will turn around this spring, and #2 is even considering renting out the property for a year, until the market rebounds.

Now it gets interesting. A few weeks ago, #3 got a job offer and must move to another city. She must sell. So she undercuts the other two. She’s also on a corner lot, but her lot is the best. She asks for $495K. I’d say of the three properties, hers is the best.

Two days later, #1 lowers his price to $470K, to undercut the new listing #3.

#2 is not joining the price war. Yet.

[Anonymous]

Good to have you back, PS. Thanks for the links and anecdotes.

[justme]

Yes, welcome back. Good story.

[Anonymous]

Welcome Back PS!

Let’s tie this in with the Zillow thread just for the fun of it. Since you know the addresses, could you go to Zillow for each one of these townhouses and tell us the 1]most recent sale price 2] property taxes paid on each and 3] current Zillow estimate of each.

What fun!

[no_such_reality]

Wow, that’s confusing to beat everything. #3 is 1st, #1 is 3rd, #2 is 2nd.

#1 listed in February, so I think #1 is #3 because #1 last and #3 is first and #2 listed in August and that’s after February.

Now Who, who’s on first. What’s on third …

Care to clean that up a bit PS, maybe making #1 the first seller (lister), #2, 2nd, #3 the 3rd.

While #2 may not think they’re in the price war, their boat has already been torpedoed.

As a side note, I was cruising through a neighborhood by my house last night. Previously 3 homes were for sale, $1.595M, $1.55M and one $1.495M (M as in Million). All are 3 or 4 Bed 3+ baths.)

One is listed for sale still the $1.595M. One is listed sale or lease, one is lease only at $3900/month and one new is lease for $3400/month. Three of the four are vacant.

Now really, who rents out $1.5 million dollar home long term? And if you think it is worth $1.5M, how do you rationalize getting only $45,000.

[VanMorrisonFan]

Powayseller…

Can you see if there have been any recent sales on your street?

I’m wondering when and for how much the last actual sale took place. I’ll bet the last sale was in the mid-500K range, right?

[PerryChase]

powayseller, good story of what’s happening on the street. Your zip realty link only works for you (it took me to my saved houses on ziprealty). If you give use the MLS #s, we can look them up ourselves.

BTW, just for kicks I looked-up what you can rent for $2,500 – $3,000 per month. The money goes kinda far. No need to buy in my view. I have a friend who pays $3,000 in mortgage for a lousy townhouse in East San Diego. I’m not sure what she was smoking when she bought earlier this year! She never shared her purchase plans with me and by the time I heard about it, it was too late to warn her.

[farbet]

PS where is your street located?

[Anonymous]

HAHA…Yeah tell me where you are located. I love you.

[barnaby33]

Ok malfred, minus context, your comment is stalker scary.

Josh

[powayseller]

1st listing, MLS 066080619, paid $430K March 2004 (Nov 94, $204K). This one is now reduced to $470K; estate sale.

2nd listing, MLS 066072181, paid $182K, July 1990 (any MEW in the meantime?). Couple nearing retirement.

3rd listing, MLS 061088282, paid $328K, Dec 2002 (Dec 1999, $212K). She’s the one who is relocating and must sell.

We’ve had a few sales, but they were smaller units. The peak price was $588K in January 06 for the 4 bedroom model.

I tried hard to clean up this story, but sorry if it was unclear.

[poorgradstudent]

Nice anecdote, and good post.

I guess the expectation that things will turn around in the Spring is based on the seasonal nature of real estate? If you were selling these properties right now, what might you price them at?

[powayseller]

Since these are just tract homes, I’d price at 5% less than the most recent townhouse sale in my area. The most recent sale, 1 block away, is a unit only 10 years old with brand new roof and a larger garage, also a corner lot, but smaller (1575 sq ft). Final list price was $440K – $470K, and it just closed a few days ago. Based on that sale, the $495K price seems reasonable. However, if one of the realtors is around, they could better say what it is worth.

[no_such_reality]

The most recent sale, 1 block away, is a unit only 10 years old with brand new roof and a larger garage, also a corner lot, but smaller (1575 sq ft). Final list price was $440K – $470K

Well, the canary will sing when the numbers post. Hopefully the holder got $400 or more. At $400, they’re only 10% below asking price, a real possibility in today’s market.

The slightly larger place adds some, but that’s partially cancelled by the new roof and garage.

[kev374]

I think the situation in Boston is far worse than in SoCal right now but SoCal will follow shortly. Things are going to get real REAL ugly. People refusing to believe it chant the same rubbish..that the job market is so strong. First off, incomes from these jobs can’t pay for homes even with a 50% decline in prices so why does that matter at all, secondly layoffs have already started first at Ameriquest, then Washington Mutual and now 2500 cuts at Countrywide.

The last 5 yrs was a deck of cards and it will come crashing down. “The gains of the last 5 yrs will be erased” as Peter Schiff would say 😀

[Author]

Posts