October 7, 2014

Reality Is Setting In For Sellers

The Sacramento Bee reports from California. “The median price of new homes in Sacramento County has gone from about $200,000 in 2000 to nearly $400,000 this year, CoreLogic DataQuick reported. The median household income for the region was just over $57,000 in 2013, down from about $57,500 in 2012 after adjusting for inflation, according to census figures. Median incomes have fallen nearly every year since 2008. Joe and Jaime Dempsey had limited money for a down payment. They looked at house after house priced from $250,000 to $300,000, many of them being flipped.”

“‘They buy for $150,000, and do cosmetic work, and are trying to make 150 grand,’ Joe Dempsey said. ‘You can almost spot them from the moment you walk in. They are staged. They’re trying to hide the flaws. You don’t know what kind of shoddy workmanship has been done.’”

“Beth Sherman said buyers competing for homes in the median price bracket should come armed with a preapproved mortgage, a good loan officer and a hardworking real estate agent. She also recommended prospective buyers write a personal letter to sellers, saying why they want the house, and think carefully about what repairs they might be willing to make themselves. ‘This way, when the right home is found,’ Sherman said, ‘they can act quickly, which can mean the difference of getting the home they want or not.’”

From Fox 10. “Gwen Pickering, who is looking to stop paying rent and buy a home, went to an open house in East Sacramento that is going for $330,000. ‘The flippers are coming in, so even if you wanted to buy a house, say, I wanted to get a house for [$229,000], and you go in and the stuff is all cheaply done, or not done right, but people bought them.’”

“It’s a trend real estate agent Josh Amolsch says was bad the last couple of years, but he believes things are starting to improve for individual buyers. ‘There’s been a lot of price reductions,’ Amolsch said.”

“Amolsch says sometimes sellers will reduce their price if the home is going to the right buyer. ‘I’ve won deals from a letter, having my buyers write a letter. And if you can get the sellers to fall in love with the buyers and want them to have the house then that works,’ he said.”

The Los Angeles Daily News. “As we head into the final stretch of 2014 one component of the San Fernando Valley’s economy is coming into sharp focus. The residential real estate market will have one of its worst years sales-wise since the Southland Regional Association of Realtors began compiling statistics 30 years ago. And there is a good chance it will be the worst.”

“‘Right now we are down in terms of sales and it’s not going to improve. We always have a slump starting in August and stretching through February or March,’ said economist William W. Roberts, director of the San Fernando Valley Economic Research Center at Cal State Northridge. ‘And there is nothing out there in the economy that suggests the housing market is going to boom.’”

The Orange County Register. “Reality is setting in for home sellers across Orange County. Rather than holding out for the big price gains seen a year ago, most sellers are cutting their prices to get their homes sold. ‘It seems like 80 percent to 90 percent of the sales are reductions,’ said Bart Smith, an agent with Evergreen Realty in Orange. ‘(Sellers are) overpricing them. They’re looking at listings and not at closed sales.’”

“‘There are countless units on the market, and more become available on a daily basis,’ said Nicole Vazirian, who sold her Placentia townhome last July only after cutting the price by more than $47,000 after six months on the market. ‘I still see homes that are overpriced, and those are the ones that … either will sit for too long or drop off entirely.’”

Bits Bucket for October 7, 2014

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