August 3, 2015

It Can Be A Gamble For The Sellers

The Journal Gazette reports from Indiana. “In the Fort Wayne area, sales of existing homes are up. Median home prices are way up, and the percentage of list price garnered at sale is up. What’s going on? Nothing like Realtor J. Kyle Ness has ever seen in his 12 years selling the area’s residential real estate. ‘With our inventory so low, people are scrambling to get to it,” says Ness, who heads the Multiple Listing Service for the Upstate Alliance of Realtors. ‘It’s almost like a frenzy. When something hits the market, it’s gone in a couple of days.’”

“Ness says he recently closed a sale with one buyer who told him that the purchased home seemed ‘a little dirty and needed work,’ but she was happy to have it. ‘But she said, ‘If I had never seen it first, I never would have thought I’d go for it,’ Ness says. ‘There’s not a lot out there.’”

The Associated Press. “Once considered a last resort to dump a property that was distressed or couldn’t sell, auctions have become a viable marketing option for selling luxury homes. It can be a gamble for the sellers. Sheldon Good recently sold a house next to the 12th fairway of the Pebble Beach Golf Links for $14 million from a starting bid of $6.9 million. On the other hand, a seller in Seattle who previously had a home on the market for $25 million ended up selling for $12 million after no buyers were willing to pay the minimum auction bid of $15 million. Sellers can only back out of an auction if their minimum bid isn’t met. Otherwise, they are locked in.”

“‘The auction helped to identify the buyer and the marketplace,’ Craig Post, executive director of Sheldon Good, said of the home in Seattle. ‘In this case, the market didn’t feel the home was worth $15 million. The seller listened and accepted a lower price.’”

King 5 News in Washington. “The housing market is hot all over Western Washington, but not everywhere. Real estate broker Wayne Snoey of Coldwell Banker Bain in Kent blames media coverage focusing solely on the building boom in the area’s largest cities. He says it’s up to him and other brokers to temper some clients’ sky-high expectations. ‘They expect Seattle everywhere. It’s not Seattle everywhere,’ Snoey said, referring to some clients’ high hopes. ‘If it happens to be in those less robust areas, you have to spend a lot more time educating the clients as to realistic expectations.’”

“Valerie Stone lives in Shelton in Mason County and says she’s noticed some signs staying up for months – or even years. ‘They’re just there,’ Stone said, adding some signs start to blend into the scenery after a while.”

The Boston Globe in Massachusetts. “The Boston area’s red hot real estate market has suddenly become a lot more volatile, with price cuts and scuttled home sales both on the rise. That’s the takeaway of two new reports tracking the health of the real estate market in Greater Boston and across the state. The percentage of listings in the Boston area with price reductions is now up over 21 percent, compared to 20 percent last year, Redfin reports, with a growing number of listings in Boston and the inner suburbs sporting price cuts.

“Meanwhile, anywhere from 13 to 20 percent of all sales are falling through before they close, an analysis of monthly pending sales numbers put out by the Massachusetts Association of Realtors shows. When one sale falls through, it can disrupt a whole chain of deals, especially if it involves a move-up buyer who is planning to sell their house, brokers say. ‘It’s this kind of domino effect,’ said James Gulden, a Redfin agent working out of the company’s Boston area office. ‘If one piece doesn’t go forward, then the next piece won’t go forward.’”

“Arlington, Melrose, Concord, Lexington, Hopkinton, Andover, Wellesley and Winchester are some of the most prominent suburbs that have seen a surge in price cutting. Arlington has seen a 23 percent increase over last year in homes with price reductions, bringing the total of listings with at least one price cut to more than 45 percent, according to Redfin.”

New Jersey Advanced Media. “According to RealtyTrac, 1 out of every 544 homes in Newark was in foreclosure in June. In some areas concentrated in the South and Central Wards, the rate was as high as 1 in 331. The state as a whole is faring only slightly better, with a foreclosure rate of 1 in 584 last month. Roughly a quarter of those were so-called ‘zombie foreclosures’ — homes that have been vacated by their owners — the highest percentage in the nation.”

“In addition to foreclosures, a massive share of Newark-area homeowners are underwater on their mortgages, having purchased their homes at prices that averaged about $325,000 at the highest of the real estate bubble, but are now worth as little as half that.”

“When Grace Alexander bought her home in Newark, she thought she had finally reached the culmination of a long journey, one that began in her native country of Guyana nearly 20 years earlier. Before long, however, her dream appeared to have gone horribly wrong. She lost 2 of the 3 jobs she had been using to pay her bills, and was repeatedly turned down by Bank of America when she tried to modify her mortgage. Falling further and further behind, she turned to everyone she could for help, including politicians from the White House to Newark City Hall. ‘All I got (were) promises after promises. After all that I’ve done, I’m about to lose my home,’ she said.”

Bits Bucket for August 3, 2015

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