Home › Forums › Housing › San Diego Home Sales about to be revised downward BIGTIME (89% to 6.5% increase in May)
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capeman.
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July 1, 2009 at 3:25 PM #424225July 1, 2009 at 4:35 PM #423534
Anonymous
Guestsdr, here is the Econ 101 explanation for your situation:
The buyers who can’t get financing aren’t really legitimate buyers. They are making bids with money they don’t have. They don’t really exist on the demand curve, they just contribute to misinformation about the exact nature the demand. (Remember, economic demand is not the same as personal want. Just because somebody wants something doesn’t mean that they are creating real demand.) And it doesn’t matter if the reason they can’t get financing is not their fault – they still aren’t legit if they can’t pay.
The sellers that won’t budge on price do exist on the supply curve. They are real. But they represent the part of the curve that is above the market price, and therefore don’t trigger any transactions. So you may have some information about the supply curve, but it only tells part of the story.
The economic models assume we know everything up front. Of course in the real world we don’t, and there is a mix of good and bad information out there. But the models are still useful.
Your frustration with the market is a result of the fact that you have to filter out the misinformation through a process of trial and error. A buyer who cannot get a loan is a bad data point, and it’s tedious and time consuming to discover this. This is the basic theme of all the realtor anecdotes here. There is more misinformation now than ever (see the title of this thread), so there is more frustration for folks who rely upon it.
The problem that you are facing is not due to the fact that the rules of economics are not incorrect, or that they have fundamentally changed. It is because you only have limited information to work with, much of it is incorrect, and it is difficult to distinguish good data from bad.
July 1, 2009 at 4:35 PM #423765Guestsdr, here is the Econ 101 explanation for your situation:
The buyers who can’t get financing aren’t really legitimate buyers. They are making bids with money they don’t have. They don’t really exist on the demand curve, they just contribute to misinformation about the exact nature the demand. (Remember, economic demand is not the same as personal want. Just because somebody wants something doesn’t mean that they are creating real demand.) And it doesn’t matter if the reason they can’t get financing is not their fault – they still aren’t legit if they can’t pay.
The sellers that won’t budge on price do exist on the supply curve. They are real. But they represent the part of the curve that is above the market price, and therefore don’t trigger any transactions. So you may have some information about the supply curve, but it only tells part of the story.
The economic models assume we know everything up front. Of course in the real world we don’t, and there is a mix of good and bad information out there. But the models are still useful.
Your frustration with the market is a result of the fact that you have to filter out the misinformation through a process of trial and error. A buyer who cannot get a loan is a bad data point, and it’s tedious and time consuming to discover this. This is the basic theme of all the realtor anecdotes here. There is more misinformation now than ever (see the title of this thread), so there is more frustration for folks who rely upon it.
The problem that you are facing is not due to the fact that the rules of economics are not incorrect, or that they have fundamentally changed. It is because you only have limited information to work with, much of it is incorrect, and it is difficult to distinguish good data from bad.
July 1, 2009 at 4:35 PM #424043Guestsdr, here is the Econ 101 explanation for your situation:
The buyers who can’t get financing aren’t really legitimate buyers. They are making bids with money they don’t have. They don’t really exist on the demand curve, they just contribute to misinformation about the exact nature the demand. (Remember, economic demand is not the same as personal want. Just because somebody wants something doesn’t mean that they are creating real demand.) And it doesn’t matter if the reason they can’t get financing is not their fault – they still aren’t legit if they can’t pay.
The sellers that won’t budge on price do exist on the supply curve. They are real. But they represent the part of the curve that is above the market price, and therefore don’t trigger any transactions. So you may have some information about the supply curve, but it only tells part of the story.
The economic models assume we know everything up front. Of course in the real world we don’t, and there is a mix of good and bad information out there. But the models are still useful.
Your frustration with the market is a result of the fact that you have to filter out the misinformation through a process of trial and error. A buyer who cannot get a loan is a bad data point, and it’s tedious and time consuming to discover this. This is the basic theme of all the realtor anecdotes here. There is more misinformation now than ever (see the title of this thread), so there is more frustration for folks who rely upon it.
The problem that you are facing is not due to the fact that the rules of economics are not incorrect, or that they have fundamentally changed. It is because you only have limited information to work with, much of it is incorrect, and it is difficult to distinguish good data from bad.
July 1, 2009 at 4:35 PM #424112Guestsdr, here is the Econ 101 explanation for your situation:
The buyers who can’t get financing aren’t really legitimate buyers. They are making bids with money they don’t have. They don’t really exist on the demand curve, they just contribute to misinformation about the exact nature the demand. (Remember, economic demand is not the same as personal want. Just because somebody wants something doesn’t mean that they are creating real demand.) And it doesn’t matter if the reason they can’t get financing is not their fault – they still aren’t legit if they can’t pay.
The sellers that won’t budge on price do exist on the supply curve. They are real. But they represent the part of the curve that is above the market price, and therefore don’t trigger any transactions. So you may have some information about the supply curve, but it only tells part of the story.
The economic models assume we know everything up front. Of course in the real world we don’t, and there is a mix of good and bad information out there. But the models are still useful.
Your frustration with the market is a result of the fact that you have to filter out the misinformation through a process of trial and error. A buyer who cannot get a loan is a bad data point, and it’s tedious and time consuming to discover this. This is the basic theme of all the realtor anecdotes here. There is more misinformation now than ever (see the title of this thread), so there is more frustration for folks who rely upon it.
The problem that you are facing is not due to the fact that the rules of economics are not incorrect, or that they have fundamentally changed. It is because you only have limited information to work with, much of it is incorrect, and it is difficult to distinguish good data from bad.
July 1, 2009 at 4:35 PM #424275Guestsdr, here is the Econ 101 explanation for your situation:
The buyers who can’t get financing aren’t really legitimate buyers. They are making bids with money they don’t have. They don’t really exist on the demand curve, they just contribute to misinformation about the exact nature the demand. (Remember, economic demand is not the same as personal want. Just because somebody wants something doesn’t mean that they are creating real demand.) And it doesn’t matter if the reason they can’t get financing is not their fault – they still aren’t legit if they can’t pay.
The sellers that won’t budge on price do exist on the supply curve. They are real. But they represent the part of the curve that is above the market price, and therefore don’t trigger any transactions. So you may have some information about the supply curve, but it only tells part of the story.
The economic models assume we know everything up front. Of course in the real world we don’t, and there is a mix of good and bad information out there. But the models are still useful.
Your frustration with the market is a result of the fact that you have to filter out the misinformation through a process of trial and error. A buyer who cannot get a loan is a bad data point, and it’s tedious and time consuming to discover this. This is the basic theme of all the realtor anecdotes here. There is more misinformation now than ever (see the title of this thread), so there is more frustration for folks who rely upon it.
The problem that you are facing is not due to the fact that the rules of economics are not incorrect, or that they have fundamentally changed. It is because you only have limited information to work with, much of it is incorrect, and it is difficult to distinguish good data from bad.
July 1, 2009 at 9:10 PM #423660sdrealtor
ParticipantWhat absolutely horrible assumptions you have made. Where o where did I say the buyers couldtn get loans? Getting loans is not the problem. Finding a property they can buy is the problem.
Most of the offers I see or write myself are from very well qualified individuals that have plenty of money to put down and can easily document their incomes. You seem to suffer from the same disease many piggs do which is not understanding that there are lots of people out there that have more money in the bank and make more money than you do. Again, financing is not the problem. There i9s plenty of real demand for homes. Supply, i.e. Finding homes ot buy is the problem.
Lastly, I am not facing a problem as I have plenty of listings. The problem is for all the buyers out there trying to buy them.
Looks like you’re gonna fail Econ 101….
July 1, 2009 at 9:10 PM #423889ParticipantWhat absolutely horrible assumptions you have made. Where o where did I say the buyers couldtn get loans? Getting loans is not the problem. Finding a property they can buy is the problem.
Most of the offers I see or write myself are from very well qualified individuals that have plenty of money to put down and can easily document their incomes. You seem to suffer from the same disease many piggs do which is not understanding that there are lots of people out there that have more money in the bank and make more money than you do. Again, financing is not the problem. There i9s plenty of real demand for homes. Supply, i.e. Finding homes ot buy is the problem.
Lastly, I am not facing a problem as I have plenty of listings. The problem is for all the buyers out there trying to buy them.
Looks like you’re gonna fail Econ 101….
July 1, 2009 at 9:10 PM #424169ParticipantWhat absolutely horrible assumptions you have made. Where o where did I say the buyers couldtn get loans? Getting loans is not the problem. Finding a property they can buy is the problem.
Most of the offers I see or write myself are from very well qualified individuals that have plenty of money to put down and can easily document their incomes. You seem to suffer from the same disease many piggs do which is not understanding that there are lots of people out there that have more money in the bank and make more money than you do. Again, financing is not the problem. There i9s plenty of real demand for homes. Supply, i.e. Finding homes ot buy is the problem.
Lastly, I am not facing a problem as I have plenty of listings. The problem is for all the buyers out there trying to buy them.
Looks like you’re gonna fail Econ 101….
July 1, 2009 at 9:10 PM #424238ParticipantWhat absolutely horrible assumptions you have made. Where o where did I say the buyers couldtn get loans? Getting loans is not the problem. Finding a property they can buy is the problem.
Most of the offers I see or write myself are from very well qualified individuals that have plenty of money to put down and can easily document their incomes. You seem to suffer from the same disease many piggs do which is not understanding that there are lots of people out there that have more money in the bank and make more money than you do. Again, financing is not the problem. There i9s plenty of real demand for homes. Supply, i.e. Finding homes ot buy is the problem.
Lastly, I am not facing a problem as I have plenty of listings. The problem is for all the buyers out there trying to buy them.
Looks like you’re gonna fail Econ 101….
July 1, 2009 at 9:10 PM #424400ParticipantWhat absolutely horrible assumptions you have made. Where o where did I say the buyers couldtn get loans? Getting loans is not the problem. Finding a property they can buy is the problem.
Most of the offers I see or write myself are from very well qualified individuals that have plenty of money to put down and can easily document their incomes. You seem to suffer from the same disease many piggs do which is not understanding that there are lots of people out there that have more money in the bank and make more money than you do. Again, financing is not the problem. There i9s plenty of real demand for homes. Supply, i.e. Finding homes ot buy is the problem.
Lastly, I am not facing a problem as I have plenty of listings. The problem is for all the buyers out there trying to buy them.
Looks like you’re gonna fail Econ 101….
July 1, 2009 at 9:18 PM #423664Guestsdr, what I don’t understand is why would these pre-qualified buyers with lots of cash (and high income) be interested in purchasing sub 500K homes? They have to be investors or it doesn’t make sense.
If I had a lot of cash (which I do), I wouldn’t be wasting time competing for some foreclosed house in ChulaJuana. Bottom line, I am not denying what you are seeing, just something doesn’t make sense.
July 1, 2009 at 9:18 PM #423894Guestsdr, what I don’t understand is why would these pre-qualified buyers with lots of cash (and high income) be interested in purchasing sub 500K homes? They have to be investors or it doesn’t make sense.
If I had a lot of cash (which I do), I wouldn’t be wasting time competing for some foreclosed house in ChulaJuana. Bottom line, I am not denying what you are seeing, just something doesn’t make sense.
July 1, 2009 at 9:18 PM #424174Guestsdr, what I don’t understand is why would these pre-qualified buyers with lots of cash (and high income) be interested in purchasing sub 500K homes? They have to be investors or it doesn’t make sense.
If I had a lot of cash (which I do), I wouldn’t be wasting time competing for some foreclosed house in ChulaJuana. Bottom line, I am not denying what you are seeing, just something doesn’t make sense.
July 1, 2009 at 9:18 PM #424243Guestsdr, what I don’t understand is why would these pre-qualified buyers with lots of cash (and high income) be interested in purchasing sub 500K homes? They have to be investors or it doesn’t make sense.
If I had a lot of cash (which I do), I wouldn’t be wasting time competing for some foreclosed house in ChulaJuana. Bottom line, I am not denying what you are seeing, just something doesn’t make sense.
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