November 10, 2014

Sellers Seem To Be Nervous

The Fresno Bee reports from California. “A master-planned Fresno community west of Highway 99 is on hold for what could be another decade. Developer Darius Assemi, president of Granville Homes, said the timing isn’t right for his Westlake development. Once the pieces come together, Assemi hopes the real estate market will also have recovered from the dismal housing downturn. Assemi said he believes the market is only halfway through the recovery. ‘We need to develop Westlake at the beginning of an economic recovery cycle,’ Assemi said. ‘Once we break ground it takes two years to get it off the ground. We want to be at the beginning of the next cycle and have product ready to go. We believe we have missed the boat on this cycle by at least two years.’”

The Seattle Times in Washington. “The median price of single-family homes sold last month in King County was $447,250, about 3 percent lower than in September, the Northwest Multiple Listing Service said. After local sales came to ‘a screeching halt’ in August, they picked up a bit in September before slowing again in October, said Bob Papke, a RE/MAX agent who covers Issaquah and Sammamish. ‘Our second selling season was pretty short-lived,’ he said. ‘Buyers have gotten a lot more picky in terms of what they want.’”

The Boston Business Journal in Massachusetts. “The market’s third-quarter downshift was apparent in communities from Cape Cod to the Berkshires, as sellers in high-end as well as lower income areas of the state resorted to deep price cuts to lure buyers their way. According to Zillow, some 42.7 percent of all homes listed for sale saw a reduction in their list prices during the three-month span that ended Sept. 30, while the average price cut per listed home was 5 percent. In the Western Massachusetts communities of South Chesterfield and Brimfield, more than 70 percent of listed homes saw price cuts in the third quarter. In Lawrence, where 49 percent of listed homes saw pricing reductions, the average cut was 8.8 percent. Further south in Newton’s tony Nonantum neighborhood, some 38 percent of listed homes combined for an average price cut of 8.2 percent.”

“Tina Sachs, a broker with Coldwell Banker Residential Brokerage in Newton, agreed price cuts are more common as the year advances, largely due to a dwindling number of buyers. Sachs said that has helped goose the market as it heads into the final months of the year. ‘A house looks a lot different when the price is lower.’”

The Free-Lance Star in Maryland. “Though the third quarter of 2014 saw significant contract activity, with more units sold during any other quarter since 2006, the Fredericksburg Area Association of Realtors urged caution in light of decreases in the median sale price and longer time on the market for most homes. The 2,199 new listings added during the third quarter represented an increase of 6.8 percent over the same period last year and was the highest third quarter level since 2008.”

“‘Agents across the region are reporting a slowdown in market activity in residential real estate sales,’ said 2014 FAAR President Debbie Irwin. ‘While the numbers show continued growth, agents are experiencing a slight softening in the market. Seasonal fluctuations can account for some of the issue, but agents report some erosion in consumer confidence with the continuing stagnation in the national economy and fears about further government spending reductions and how that would impact Virginia.’”

In Maricopa from Arizona. “The average home in Maricopa is taking more than 106 days to sell, compared to less than half the time last year, resale expert Dayv Morgan of Maricopa said in reviewing September sales figures. ‘Sellers seem to be nervous when their home does not sell in the first few weeks, but three months is not very long, said Morgan. ‘Back 2006, they were not selling at all. It does feel a little slow compared to a year ago,’ he said.”

“‘New homes have done better,’ said Amy Jo Schoeberl of Province Active Adult Homes in Maricopa. ‘You can buy a new home for the same or less than an old one.’”

The Reporter Telegram in Texas. “The air is coming out of the balloon. It feels more like blood draining from our face. The price of oil is plummeting, and we’re getting flashbacks to 30 years ago. Are developers building skyscrapers that will sit empty? Will those Inner Loop apartment complexes go Gulfton? Is this panic just an overreaction?”

“Petroleum industry analysts say things are different this time. Fracking wells have a shorter lifespan than traditional oil wells, meaning supply can naturally shrink to accommodate demand instead of flooding the market. Long-term contracts and proper hedging will prevent any sudden corporate collapse. Cost-cutting and new efficiencies mean many wells can remain profitable even if oil continues to drop. Plus, Houston’s economy is more diverse than during the early 1980s. This time, it is different. Famous last words.”

Bits Bucket for November 10, 2014

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