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June 22, 2006 at 12:07 PM in reply to: Housing market affected?? Nokia ends Sanyo venture plan, to ramp down CDMA #27316
sdrealtor
ParticipantSorry Nancy but you are completley off base and took my post completely out of context. Here is what I meant. If prices drop precipetiously, I might consider selling my current home (worth $1M but $400K tax basis) to buy a bigger nicer home in the same neighborhood (i.e. for 600 to 700K) when the increase in RE taxes would not be so great. If I moved today to a home that would be worth upgrading to, my RE taxes would triple or quadruple so I wont even consider it. If I could move up and have taxes less than double of what I currently pay, it would give me food for thought.
I would never ever consider moving to Texas…never…..EVER! The only way I will ever leave the community I currently live in would be in a pine box. Can I buy you a 1 way ticket there?
BTW, PS sold for more than just money. She built her dream house but realized that it wasnt her dream home because it was not the community she wanted to live in. That is one of the reasons she is happier now living in a townhouse she rents. Not only is she in a better financial position but she is now surrounded by nice neighbors in a nice community rather than living in a beautiful house on top of a mountain in the meth capital of the US.
ParticipantHomes are not as liquid as stocks LVnewlist. So even though the arrogant seller finds out their house is worth alot less than they thought they cant call Schwab to unload it today. To Docteurs point, many will admit missing the boat and will stay put.
CFO, I appreciate your perspective and find no problems with your logic other than the fact that RE markets are driven by emotion as much or more than logic. My experience is that scientific approaches to understanding it are frequently wrong. Leslie AY hasnt been right in years nor has the UCLA Anderson forecast. I also wouldnt consider moving at these prices due to increased RE taxes. If prices dropped precipetiously I might consider it though I love where I live and really want to pass this great home onto one of my children. However, things change in peoples live and sometimes they need more room, thus they buy the gap at the higher levels instead of waiting.
ParticipantI would estimate that I speak with anywhere from 50 to 100 productive, experienced agents every week. People with ethics, experience in bad markets and a real understanding of selling real estate. Solid agents that have been around for many more years than myself and who will be around for many more to come.
The best way to determine someone’s motivation is to simply ask them where they are going. People’s motivation generally comes from where they are going not where they are coming from.
They reason you take the listing might be a couple reasons. First, you think you might be able to sell it. Second, listings are what drives this businesss. Listings generate buyers for you and they generate more listings. Third, it’s your farm area and you want the visibility of having your sign up rather than a competitors. I’m sure there are more but those are the ones that immediately come to mind.
ParticipantThere is no reason they will have to wait 10 years for another bedroom as long as they bought more than 2 or 3 years ago and have siginificant equity. Moving up simply requires one to “buy the gap”. In a better market (by better I mean less inventory not necessarily higher prices) it will b easier to get their home in escrow and then search for the right home to “buy the gap” on. With lower prices the tax bite will also have less sting!
back to the point through….that right there proved my point. 3 sellers that were testing the waters, failed and are staying put. We dont know how many more like them are out there. It may or may not be significant but dont be surprised if we see inventory actually drop this Fall.
ParticipantThere is no reason they will have to wait 10 years for another bedroom as long as they bought more than 2 or 3 years ago and have siginificant equity. Moving up simply requires one to “buy the gap”. In a better market (by better I mean less inventory not necessarily higher prices) it will b easier to get their home in escrow and then search for the right home to “buy the gap” on. With lower prices the tax bite will also have less sting!
back to the point through….that right there proved my point. 3 sellers that were testing the waters, failed and are staying put. We dont know how many more like them are out there. It may or may not be significant but dont be surprised if we see inventory actually drop this Fall.
ParticipantBugs,
No problem. I was confused by CFO’s post and now realized he meant sales targets set by the sales persons themselves. In my experience selling for corporate America the unrealistic sales targets always came down from the finacial guys not vice versa. His situation must be different.ParticipantCFO,
I dont understand what you are trying to say, could you please calrify this statement. “I always need sales people but I have NEVER had one come in with sales targets that could be met and it’s always a different story why.”ParticipantYou miss the point. I never said that inventory would fall only that it could. To refuse to llok at both sides of an issue is to set oneself up to get blindsided. Personally I beleive it will stay pretty close to what it is now. But several long time successful agents that I greatly respect and who are sitting on a lot of listings believe a good portion of their sellers will stay put and take their homes off the market potentially reducing inventory levels.
ParticipantI guess we have 2 rocket scientists out there! Did you read the initial post? It started with “While it is safe to assume that prices will continue creeping down…..”
ParticipantI had a client that lost their job last year and fell prey to an unscrupulous lender. They refi’d out of a fixed into a cash out option ARM. They recently sold and got hit with a $10K prepayment penalty. Unfortunately they never called me to ask my opinion which would have been to get a HELOC to buy themselves time not to put $10K into some scumbag lenders pockets.
ParticipantNice try chump (CFO Not AN)! My feet are as firmly planted on the terra firma as anyone’s. Check my post and you will see that I did not say this WILL happen, only that it is a plausible scenario. We really have no idea of how many people are testing the market/don’t HAVE to sell. Inventory continuing to increase or at least stay flat looks to be the case. I was just introducing the possibility that it could actually fall, so those of you out there would not be completely shocked if this does happen. My suspicions are that the number of “unmotivated sellers” is somewhere between 10 and 30%. What they will choose to do when faced with a new market reality is anyone’s guess.
Inventory going up 27% when more people put their house on the market than any other time does not necessarily equate to 27% growth over the next 3 months. We typically see a fall off in the number of new listings around July.
We are in uncharted territory and I nor anyone knows what will happen. However, intelligent people like to look at all angles of things so as to avoid being blindsided.
ParticipantFunny but Bill sounds oddly like me. I have been saying all along that the data is a joke. What I find interesting is how an individuals bias impacts their interpretation of information. Another poster had a term for it but it’s escaping me right now.
It reminds me of an old joke.
A guy walks into his CPA and asks him what does 1+1=? The CPA walks over to the window, lowers the shade and says “Whatever you want it to!”
Use caution in interpreting any data…that which you don’t agree with as well as that which you do agree with.
ParticipantAny realtor worth a grain of salt knows DOM is a joke not just Jim. The main reason DOM stats are out there is because people ask for them. Calculating them accurately is nearly impossible. When people ask me I usually say I dont know followed by the statistics say about 50 to 60 days but I beleive 90 to 100 days is probably more accurate.
As far as manipulation goes, relisting may or may not be manipulation. The DOM is representative of how long the home has been on the market under the current listing contract. It’s a legal issue. When the contract expires and the property is unsold a few things can happen.
Extend listing and DOM keeps ticking (no manipulation).
Immediately relist with another agent (No manipulation)
Immediately relist with another agent that is part of the same team(manipulation- one very prominent Carlsbad husband, wife & child team is notorious in this practice)
Immediately relist with same agent (depends- some agents intentionally take short listings 45 to 60 days so they can do this. This is done by a great many of the high volume high profile agents so they can advertise that all their listings sell in 30 days.)
Take off market for at least 30 days and then relist with any agent (no manipulation)
I may have missed a few but it is not a clear cut issue.
ParticipantPretty accurate except the part about inventory not going down. It could easily drop as unmotivated sellers exit the market after Labor Day.
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