‘Sellers Are Starting To Realize, Buyers Don’t Have To Buy’
It’s Friday desk clearing time for this blogger. From Florida, “The number single-family home sales in Escambia and Santa Rosa counties dropped significantly from June to July, while median sales prices have dipped just slightly. ‘I’m noting more price reductions,’ said veteran Pensacola realtor Alexis Bolin, an outspoken critic of high home prices. ‘Reality has set in to the marketplace, and sellers are starting to realize that buyers are educated about this market, and that a lot of buyers don’t have to buy.’”
From Virginia. “Languishing ‘For Sale’ signs sitting for months in front of homes in Falls Church are not a problem for well-to-do long-time homeowners not burdened under the pressures of a ballooning adjustable rate mortgage. But for all those young families who bought into the binge, the viability of the lives they hoped to construct with in a $700,000 home will quickly vanish.”
“Morgan Stanley’s Roach calls this a ‘pull back.’ It could more readily be called ‘chaos.’”
From Wisconsin. “Dane County’s real estate market continues to cool from the frenzied pace of 2005 to what industry officials consider a more ‘traditional’ market. ‘There’s inventory out there that we’ve never seen before,’ said John Deininger, director of the RASCW. ‘The concept that it can go up every single year is naive.’”
From Illinois. “Echoing national housing trends, the Rock River Valley is turning from a sellers’ to a buyers’ market, complete with a growing supply of, and shrinking prices for, existing homes. ‘Have you heard the saying the little pig gets fat, but the fat hog gets butchered?’ asked Jim Barbagallo, president of the Rockford Area Association of Realtors. ‘People who price their homes too high hoping to cash in are seeing them sit out there.’”
From Texas. “More and more North Texas homeowners are in big trouble. Residential foreclosure postings are at record levels. More than 3,800 houses are threatened with foreclosure next month in the Dallas-Fort Worth area. ‘This is bringing back nightmares of 1988 and 1989,’ when thousands of Texas homeowners lost their properties during a regional recession, said George Roddy. ‘The average number of postings in 1989 was about 2,000 a month,’ Mr. Roddy said. ‘And that is when we saw a massive devaluation of residential properties in some areas.’”
From Arizona. “The Arizona State Land Department is reconsidering its asking price for a potentially lucrative property in Fountain Hills after a similar high-profile land auction failed to draw bidders last week.”
“‘We may have an auction, but we’re obviously analyzing the changes in the market as evidenced by (Aug. 8’s) unsuccessful (Desert Ridge) auction,’ Land Commissioner Mark Winkleman said. “We’re certainly concerned the appraised value may not reflect that current market value.’”
“Summmer’s winding down, and you may have begun toying with the idea of a second home. And so you wonder: Are you letting your heart run away from your head? Should you even be considering a vacation home? Probably not, unless you can accept that you’re no longer going to get rich quick by buying a second home.”
“Many U.S. homeowners continue to take cash out of their homes even as mortgage rates climb and home sales slip, helping to brace the economy, economists said. With existing home sales off 7 percent in the second quarter and mortgage rates climbing, some economists see the ongoing refinancing spree as the once-hot housing sector’s last gift to the nation’s economy.”
“Art museums have long rented paintings to art lovers who want the real thing on their walls, but lately, museum officials say they’ve seen a spike in demand from home sellers. At New York City’s Agora Gallery, director Angela Di Bello says she fields at least five calls and e-mails per day from inquiring real estate practitioners, up from ‘none’ a few years before. ‘I’ve been in this business 25 years, and I’ve never seen anything like it,’ she says.”
The Australian. “The economic soft landing used to be up there with the cure for cancer. It featured prominently in the rhetorical promises of policymakers but rarely in the harsh reality of a world that refused to conform to wishful thinking.”
“Now we are about to discover, with great consequence for the world, whether this run of successful soft landings can continue, or whether the US, the screaming engine of global growth for the past five years, is heading for a crash. The Federal Reserve’s decision to leave interest rates unchanged underscores the degree of uncertainty in the US economic establishment about the near future.”
“Many Americans are desperately refinancing, finding themselves with thousands of dollars less a year in disposable income than they had last year. Debt levels are sky high and the savings rate is negative.”
“(One) view might be called fatalistic realism. It accepts the proposition that, on current policies, a recession is coming, but insists that it is absolutely necessary. A recession may well simply be unavoidable. For the Fed, and the world, a recession may be the price that now needs to be paid to avert a longer-term catastrophe in the global economy.”
Another great week! My thanks to those who support this blog. Please check back this weekend for news, your market observations and topics. Tomorrow from 2-3pm PST, this blogger and Rich Toscano will be on San Diego radio live, on KCBQ with host and bankruptcy lawyer Mark Miller. So call in.
Ben-
Knock-em dead off their feet,
and take no prisioners.
Is this the show you were on last year? If so, I think I remember the lawyer was actually a bite bearish at that time?
Is there a link to a stream available?
Congrats, Ben. The MSM attention is well deserved, and long overdue.
Absolutely 2nd that vote!!!
KCBQ that used to be a teen rock station when I lived in Escondido in the 70’s, I forgot what are their station numbers?
1170 am
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Ben - can you have them record it as a mp3 podcast and post it here or somewhere for replay????
I am going to listen online at http://www.kcbq.com. Good luck Ben.
Link doesnt work for me
Just delete the . in the url.
Yay!! Week end time. School starting next couple of weeks. Just in time for the back to school real estate rally. Better buy before you get priced out or all those pesky sellers raise prices on you. You know they’re not making any more land….. have a great weekend y’all.
School started last week here in the Ozarks.
At the most remote end of the wine cellar there appeared another room less spacious. Its walls had been lined with construction debris, piled to the ceiling overhead, in the fashion of the great catacombs of Paris. Three sides of this interior nook were still ornamented in this manner. From the fourth side the debris had been thrown down, and lay promiscuously upon the earth, forming at one point a mound of some size. Within the wall thus exposed by the displacing of the debris, we perceived a still interior crypt or recess, in depth about four feet, in width three, in height six or seven. It seemed to have been constructed for no especial use within itself, but formed merely the interval between two of the colossal supports of the roof of the McMansion, and was backed by one of their circumscribing walls of solid granite.
It was in vain that Watts, uplifting his dim bulb, endeavoured to pry into the depth of the recess. Its termination the feeble light did not enable us to see.
“Proceed,” I said; “herein is the Amontillado. As for Lereahcci –”
“He is an prophet,” interrupted my friend, as he stepped unsteadily forward, while I followed immediately at his heels. In niche, and finding an instant he had reached the extremity of the niche, and finding his progress arrested by the rock, stood stupidly bewildered. A moment more and I had fettered him to the granite. In its surface were two iron staples, distant from each other about two feet, horizontally. From one of these depended a short chain, from the other a padlock. Throwing the links about his waist, it was but the work of a few seconds to secure it. He was too much astounded to resist. Withdrawing the key I stepped back from the recess.
“Pass your hand,” I said, “over the wall; you cannot help feeling the stucco. Indeed, it is very damp. Once more let me implore you to return. No? Then I must positively leave you. But I must first render you all the little attentions in my power.”
“The Amontillado!” ejaculated my friend, not yet recovered from his astonishment.
“True,” I replied; “the Amontillado.”
As I said these words I busied myself among the pile of debris of which I have before spoken. Throwing them aside, I soon uncovered a quantity of building stone, granite blocks, and mortar. With these materials and with the aid of my trowel, I began vigorously to wall up the entrance of the niche…
EAP fan? Nice adaptation.
Edgar Allen Landlord. Funny! Gad, we have a lot of talented folks on Ben’s blog.
Nice work. EAP and Twain are my two favorite American authors.
“For the love of God, Montresor!”
“Yes,” I said, “for the love of God!”
MAD!!??
tis not I who is mad……..
therin lies the head realtor of Orange County, walled up in the very McMansion he sold to the FB…. Late at night one can somtimes hear the plantitive echo of the past ” 15% its in the bag”
‘Reality has set in to the marketplace, and sellers are starting to realize that buyers are educated about this market, and that a lot of buyers don’t have to buy.’”
I always said if you buy over the last 2-3 years your dumb in thinking that prices wont drop under 2001-2 prices… This is just the beginning.
I agree with your take on the matter, wholeheartedly. But, of course, to say “your dumb” is, well…
There’s a booming fear running though these stories. Agents are getting rattled, and the realization that something’s really wrong is being verbalized. This has a calm before storm sense to it, and though I accept that the posters here were right all along, the end game is approaching. Here’s to being forewarned.
Had lunch with a commerical realtor who is doing some work for us on a small development. What a riot. This guy brought along a contractor and they kept saying things will pick up in February or March of next year. LMAO - are we back to the Super Bowl rally again??? Last year at this time these clowns kept saying - new fundementals, prices will keep going up, etc… - now its just slowing to a normal market. I said “What exactly does that mean”. Dead silence… Uh well things will pick up in Feb/Mar 2007. I wanted to agrue with them but I just shut up - the contractor recently finished his million dollar home and I am sure that deep down inside he knows the truth. Why do I even argue. I need to just shut up!
Yeah…or they might just shoot the messenger!
A classic example of whistling in the dark.
Yeah, and I’ll be a well hung white man by next Spring……it just ain’t gonna happen.
From 8/8/2006 to 8/15/2006, there were 9 homes sold in ZIP code 90274 for an average price of $1,710,889.
1) $3,450,000 on Paseo Del Sol
$1,900,000 on Via Media
2) $2,575,000 on Paseo La Cresta
3) $1,360,000 on Pepper Tree Ln
4) $1,290,000 on Pleasant Hill Dr
5) $1,450,000 on Rousseau Ln
6) $153,000 on Via Carrillo
7) $1,575,000 on Via Media
9) $1,645,000 on Via Pinzon
There are still buyers with lots of money in 90274. I wonder how many could have saved 100K or 200K had they waited assuming escrow began 30 or more days ago. Too late.
I did the cabinets for the 33 homes in the ‘Pepper Tree Ln’ developement….they started around 600k and are mostly Asian owners. The builder did nice quality work.
“…wonder how many could have saved 100K or 200K…”
Sounds like (choke) chump change for these folks.
90274 and 90275 are very nice.
In the last downturn they lagged the market by ~30 months and then tanked.
I wonder what they’ll do this time.
How do I know that? I remember friends of my family crying due to losing their homes in 1993 and 1994 in those zip codes. Several BK’s.
You wouldn’t believe the number of flips for sale I saw in 90275. Really nice views and well redone homes (mostly, some were crap).
Oh, I’m certain a zero was left out from home #6.
“Art museums have long rented paintings to art lovers who want the real thing on their walls, but lately, museum officials say they’ve seen a spike in demand from home sellers. At New York City’s Agora Gallery, director Angela Di Bello says she fields at least five calls and e-mails per day from inquiring real estate practitioners, up from ‘none’ a few years before. ‘I’ve been in this business 25 years, and I’ve never seen anything like it,’ she says.”
So renting a Picasso for the living room wall on my staged 2Bdm Brooklyn row house will help me fetch that $3.5 million I’m asking? So I guess I’m looking for a complete idiot with ecclectic taste in art, but lousy taste in housing.
Last I heard … The Donald (a RE Bull among Bulls) is saying Harlem, NYC is a hot spot. LOL! Well Donald, why not YOU Set up shop there and call it home. If there ever was a RE pimp
he be called the “The Donald” today.
Like RE bear Jim Rogers said a few months ago when asked by one of the financial journalists about The Donald being bullish on real estate (slight paraphrase): “Well, yes, I suppose that’s because he’s got a lot of real estate to sell.”
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Billionaire Jimmy Boy was calling RE Bubble in April 2002
19 Apr 2002 Unreal Estate
http://www.jimrogers.com/content/stories/articles/Unreal_Estate.html
Donald Trump has a history of throwing away his father’s hard earned real estate fortune. This is keeping with his past.
If Trump had not been bailed out by his dad in the early 90’s to pay the bankrupcy attorneys he would be living in Harlem today.
Don’t forget the bank forgiving him $600 million in bad loans. Don’t know what the hype is about this guy. He’s not a very good business man and seems to try waaaay to hard to make everyone believe he is the greatest. Anyone seen the article about his $100 florida property that was renovated and is just sitting waiting for a buyer? Bet that one is eating a hole in his pocket.
You people really must stop slandering the Donald.
I have seen him asked this very question. He claims it is his business prowess that allows him to make money at times and have others take his losses in bad times. He says it is shrewd business or maybe just Daddy’s blind trust.
Harlem has been a hot spot for years. Ronald is getting old, slipping… However, for years, since about 1995 there has been rehabbing all over Harlem.
If I were an art thief…
Think of it. You rent a place using a stolen identity. You pretend to “sell”. The RE agent brings the goods to you. And you’re gone…
I wonder if it really is just that easy.
Isn’t it “amantillago”?
No, no it isn’t.
Amontillado is a very nice wine. It was featured, so to speak, in my all-time favorite movie, “Babette’s Feast.” You can buy Fondillon’s Amontillado at Du Vin in Alameda.
‘The concept that it can go up every single year is naive.’”
And my god do we have a wealth of the naive around to fleece.
pimf Amontillago
Teh second link in Ben’s post, “From Virginia,” is well worth reading in its entirety, IMO. Assuming the publication has any decent circulation in the Falls Church area, it must be sowing panic right now. Roach is super-bearish about housing and the U.S. and world economies — he writes/speaks as if he were a poster here.
The last link is also well worth reading in its entirety. Is it just me, or are the foreign papers far superior to American newspapers in their coverage/analysis of economics?
Probably “survivorship bias”. Do you think the crap foreign articles bother getting reposted here?
Yes, that was a good one, especially for the amount of content in its brevity. Unlike most USA Today pieces, which are usually brief and content-free.
One subject that foriegn news sources are almost alway better about is currency and trade issues, since Americans are not ususally concerned with those topics, while most of the rest of the world pays close attention. Imagine if California farmers had to deal with trade issues with New York - Oh, wait, there’s still that little problem with wine, right?
Seriously, we don’t often stop to appreciate how nice it is to share a common currency and have free trade across such a diverse economy as we have in the States.
Roach served up a triple helping of the Good News to the people of Falls Church today that’s for sure. I bet there are a few people walking around stunned.
Actually I should give the credit to Nicolas Benton for putting such a hard hitting piece together.
Didn’t Roach turn Bullish a year ago or so? No he is back to a bear. The article will send a chill down the spine of every resident in No. Va. - Va_investor, Dc_Bubble, Lance, etc… enjoy!
I sold a lower-end (but still bubbly market) house I fixed up in the Shenandoah Valley in Va. in May (and decided to move to Fla. and rent for a year) and told my RE agent on the day of the closing that that house would never again sell for the $$ I got. She almost laughed at me. Sure, the recent price increases have been unusual but the market will always go up 5 or 6 per cent a year, she said. Of course it even goes without saying that the buyers had zero money, and got a 103%+ loan since I had to of course to pay the closing costs and add them into the sell price.
Remember when people in the stock market were saying, oh, sure the recent increases are unusual, but we can expect a steady 10-12% in normal years?
Rappahhannock County VA
July 2006 market statistics:
Properties for sale: 70
Properties sold: 5
Properties sold last year: 12
Median Sold Price: $ 285,000 vs. $ 473,000 - 39.75 %
Here is what’s available on http://www.ft.com from the Roach piece. Unfortunately I don’t have a subscription - anyone else? I’m still burning from WSJ charging me four times for both online and paper for both Barron’s and WSJ - guess I need to cut one of those and subscribe to the FT - anyway:
Not much fizz left in the global economy
By Stephen Roach
Published: August 13 2006 18:31 | Last updated: August 13 2006 18:31
“There is nothing like the seduction of a boom. The recent vigour of global economic growth is a siren song. By International Monetary Fund metrics, world gross domestic product growth probably averaged 4.8 per cent over 2003-06, the strongest four years since the early 1970s. As tempting as it is to extrapolate this into the future, that may be a serious mistake. There is a much better chance that global growth has peaked and the boom is about to fizzle.”
“The world’s main growth engine, the US, is slowing. That is the verdict from the labour market, with job growth in the past four months running 35 per cent below average since early 2004. It is the verdict from the housing market, where an emerging downturn in residential construction activity is knocking at least 1 percentage point off the GDP growth trend of the past three years. And, notwithstanding July’s temporary bounce-back in retail sales, it is a message from the consumer, whose inflation-adjusted spending growth fell to 2.5 per cent in the spring period – one percentage point below the heady trend of the past decade.”
Read your Roach here, lads:
http://www.morganstanley.com/GEFdata/digests/digests.html
Wow — that’s a gold mine. Thanks, Judy.
It feels to me like sales prices are in this black box of quantum uncertainty; the same one Schrodinger’s cat was in. Who can know what the market value of a house is? It’s not the current asking prices in major markets- that is, the peak market values- as a buildup of inventory and decline of sales seems to be a pattern everywhere for properties asking for that kind of money. But it’s not fundamentals either, as anything selling at fundamentals now I bet would be quickly snatched up. So where is it? It’s an interesting and, I think, unknowable question at the moment. Let the standoff…er… continue!
BTW, I would guess right now we would have a pretty active and healthy housing market if prices droped consistently 20% below peak. It would go down further however once subprime lending standards are tightened up.
When are the standards going to be tightened??? I remember something about “new” recommendations coming out Sept. 1st. Is this still the case?? I heard an idiot punk kid on the Metrolink train the other day talking about closing a house with no $$ down and a 1% loan. This kid definately did not look like he had the $ to buy at today’s prices. I can’t wait until only people with a stable income, down payment and a high credit score can borrow money for a home. These punks/fools are still driving the market!
Great question but one with multiple answers.
The same factors that drive a market up also drive it down, fear and greed. On the way up most of the greed lies with the seller while the buyer fears missing out. When the market turns there is a short term equilibrium commonly catagorized as a stand off or paralysis which eventually gives way and for those people who have to sell, this includes home builders, fear takes over and panic sets in. For this group who have limited options the effect can be both rapid and brutal with reductions from the peak as much as 50/60%.
Potential buyers then get greedy and are convinced the entire market is going down forever in much the same way sellers in an uptrend belive the market can only keep on going up. This results in a second equilibrium where sellers who don’t have to sell their property take it off the market or use the fall in price differentials (where a larger more expensive house has fallen by more than their own) to upgrade. Sellers who don’t want to move will trim back their budget, get another job or take in renters rather than sell.
Good quality houses in great locations where the seller is not in any hurry to sell may even continue to rise. This statement may appear unlikely on the face of it and requires further explanation. Many Mcmansions are in middle/upper middle class areas and for the most part are occupied by small families with a number of spare bedrooms. Even if the price falls from say $1.5m to $1m they are still outside the reach of most families. However, I believe there will be a cultural change towards multiple families pooling their resources with several generations living in the one house. Rising gas prices make this even more probable. Don’t be surprised if 12 people living in a 6 bedroom house becomes the norm. Those people who currently live in these areas for the peace and quiet may be forced to pay a premium to find it elsewhere.
I could be way off the mark with my projection of larger families living in larger homes but if I’m right this leaves condo’s looking vulnerable, unless of course the next development boom is converting condo units into family suites occupying the entire floor of a building.
I think that to assume a reduction of 20% across the board would generate a healthy and active market may be over simplistic. Some houses would not budge with a 20% reduction and others would have multiple bidders.
The cliches on the thread titles are getting pretty funny.
I love the humor on Ben’s blog — I think it is one of the defining differences that set it apart from all others. There may be some, but I know of no other blog in which posters interlace such great wit among very serious discussions.
Interesting that Texas Dallas area has about the same average income of Seattle with about 30% less cost of living and they are experiencing massive.. Forclosures..
Im willing to bet money that Seattle will experience much greater numbers than Dallas when the equity train runs dry.
Today I checked on the street where I sold my last house. (East Charlotte). I got $80/sq ft for it in the summer of 2004.
There is one home for sale there now. Asking price? $80/sq ft! Mmmmboy. Those generic mid 1980s vinyl villages really appreciate.
…And… oh yeah. We’ve had about 5200 foreclosure filings. In just the first 7 months of 2006.
Looks like Mecklenburg County could hit 10,000 foreclosures this year. (We had over 8K last year.)
Why so many in Charlotte? Homes are relatively inexpensive there. 300k for 3000 sq ft and a half acre. WTF?
Charlotte can be quite pricey close to the center of town or by the lake. We also have condomania going on too, with $300/sf one bedroom new construction.
But Charlotte also has quite a lot of 1970s-1990s sprawl starter homes, and these can be picked up under $120k easily. These gradually aging subdivisions are turning into Latino areas, and I see many Spanish-sounding surnames appearing in the notices of foreclosure.
Thanks Mozo Maz
Meckleburg’s reputation for screwed-up schools and redistricting yearly is becoming well known. I almost moved there and the realtor was hush-hush about the fiasco with the schools. We are now looking into Wilmington as we are city folk and like a little action…and of course..the beach!
from Sunday’s NYTimes:
http://tinyurl.com/fykrk
“Let’s Make A Deal: As the residential market softens, buyers are daring to offer less than the asking price, and sellers are finding that they have to be open to negotiation.”
“Renee LePore, an agent at Beryl Z. Realty in New Rochelle, N.Y., recalled a recent negotiation in which she knew both how high a buyer was willing to go and how low the seller would go, and she used that knowledge to the seller’s advantage.
The buyer offered $380,000 on a house listed at $435,000, but told Ms. LePore that $400,000 was her limit. The seller rejected the bid and told Ms. LePore she could go as low as $390,000. When the buyer offered $390,000, Ms. LePore urged her to go higher, even though she knew the $390,000 would have been accepted. The house eventually sold for $400,000. “I was working for the sellers, and my job was to get the best price,” Ms. LePore said.”
give me a break…don’t buy now and don’t ever trust your realtor (if you use one)!
Ah, the hazard of dual agency.. and a hungry agent that hadn’t recieved a commision check recently.
But in a way, I don’t see why we should expect it to be any different. A listing agent first has responsibility to the seller, and generally understands the seller better after spending days/weeks/months trying to get a house sold.
When negotiations break down with a buyer, the presumedly “dual agent” is again a listing agent.
What a lovely advertisement for herself! Why didn’t she just type “UNTRUSTWORTHY” in red letters on her forehead?
If you claim that what she did was within the bounds of expectation, that’s perfectly true, but any seller who read this won’t give her the time of day in the future.
You know what, send the post to the licensing board in the state of New York. In a dual agency situation, revealing the information this Ms. LePore revealed is one of the few things that could cost her a license. And both the buyer and the seller could sue her and her brokerage and collect some $. I guess this isn’t the same “Ms. Lepore” who ran the elections office in Palm Beach County during the 2000 presidential election.
Okay, like um duh, the seller hired this agent to MAKE THEM THE MOST MONEY POSSIBLE on the sale of their home, period. She did her job. That’s all. If the buyers had not wanted to go any higher than $390,000, than they should have stood firm. The seller would have probably capitulated. When I buy a house, I always find out how long it has been on the market, whether there is a divorce involved, etc. I would want this agent if I was selling my house.
Ben,
I’ve been meaning to ask for awhile - is all the blog content being backed up regularly? We’ve recently been doing this at work and I’m sleeping better at night. I hate to think of our historical treasure trove here being at any risk of disappearing due to a dead disk drive, or the BumbleFrack Association of Realthors doing a little crack job…
Probably a bigger problem is “link rot”, in which some sites (especially MSM sites that don’t get the paradigm) destroy or move the linked pages. This is why good quoting is so important: preservation of context when the links no longer function.
most of the lost links can be found again using archive.com
great resource for all kinds treasure hunting.
On the Arizona land auction: If they (the state land department) really care about their “entitlements”, they’ll do an absolute auction and get the property in private hands as quickly as possible, while there still might be some speculators out there.
Of course, it might be for the best in the long run if some boundaries are drawn around Phoenix, and the next round of development (in 15 years or so) occurs independantly.
A lot of people today, with massive debt, are modern day sharecroppers.
“If americans ever allow private banks to issue their money, first by inflation then deflation, the banks and corporations that grow up around them (the banks) will deprive the people of their property until one day their children wake up homeless on the continent their fathers conquered.” Thomas Jefferson. 1819 during debate over recharter of 2nd U.S. Bank.
Federal Reserve = Private Bank
http://www.freedomtofascism.com
Just finished biography of Andrew Jackson and have also read a couple of Jefferson. Both of those presidents considered it a duty and succeeded in getting rid of the national debt during their terms in office (that’s one of the main reasons they both had lots of enemies, especially during their second terms), and yet the two probably contributed more to making America great than any other two presidents in our history.
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true story - went to a dive strip club last Wed night and one of the dancers told me her day job was a realtor. she said she’s a single mother with 2 kids and she takes her kids to all the showings and everwhere else except for closings. not sure how long she’s been doing it or if she’s been successful but this must be a sign.
That’s REALLY sad that someone in a perfectly noble and respectable profession would have to resort to having a second job like THAT. I hope the other strippers completely shun her.
lol. I was about to chastise you as a close-minded person, then I reread your post. You may now proceed to chastise me for having poor reading comprehension.
does she bring her own brass pole to her showings?
I might buy something if I thought I could get a free lap dance out of it. Maybe that will be a new closing incentive? Buy this home, and I will come by with my portable pole once a week and dance for you.
21,000+ houses with reduced prices in Phoenix metro according to ZipRealty.com This bubble is bursting at an epic rate. This will end up being the worst housing crash ever.
Am trying to buy a lot in Pinal Cty and cannot get the realtor to get off the dime and get the seller’s signature on the offer–interest rate rising as the clock ticks–no wonder buyers are sitting on the sidelines
A great quote from the Aussie article referenced in Ben’s post:
“As elusive objectives go, the economic soft landing used to be up there with the lasting peace in the Middle East, the end to poverty in Africa and the cure for cancer.”
Amen to that. “Passengers, please adjust your seat belts and assume the violent-crash-landing position, holding firmly to your ankles.”
‘Sellers Are Starting To Realize, Buyers Don’t Have To Buy’
actually, BUYERS are starting to realize buyers don’t have to buy!
..’cause if they wait a bit, buying will be cheaper
this is the ’shift in psychology’ we’ve been waiting for, which is the single biggest factor is the market
we’ve gone from ‘if I don’t buy now I’ll be priced out forever’ to ‘if I buy now I’ll be paying too much because prices are falling’
we’ve gone from ‘if I don’t buy now I’ll be priced out forever’ to ‘if I buy now I’ll be paying too much because prices are falling’
You might call this being “priced-in forever”. As in, “I’m so far underwater on my house that I can’t afford to ever move.”
“(One) view might be called fatalistic realism. It accepts the proposition that, on current policies, a recession is coming, but insists that it is absolutely necessary. A recession may well simply be unavoidable. For the Fed, and the world, a recession may be the price that now needs to be paid to avert a longer-term catastrophe in the global economy.”
I support this view
Another view might be Kiss My Arse you friggin bagholding RE flip-fukks!
That what I meant to say
Fresno Bee Friday Business section, selecting out the low points, front page headline: “The Price is not right, Agents Say”. Existing home prices are falling one to two percent per month minimum. Cliff Lloyd of RE/MAX Gold in Fresno said “The sellers chase the market for months and months instead of biting the bullet and reducing the price now”. The market is depreciating and the sellers are falling further behind. Roby Strachan of Realty World- Strachan Gamber “if you list your property at what everyone else lists theirs it won’t get shown”. He says for a half point of interest increase, about 20 percent of the buyers are out of the market place and another half point takes out another 16 percent. The lower twenty percent that are missing artificially bring up the median price. Joan Jolly, president of the Fresno Association of Realtors “We can’t say that just sellers have been in denial; a lot of agents have been in denial, too”. Dataquick shows median prices in the county are up fourteen percent from a year ago, but real estate experts said these numbers are only those that closed escrow. Those transactions for July were for properties sold in May or June when prices were higher says an agent from London Properties.
That’s what I meant to say
This is one of the comments that I hear often in S. FL, “You have to buy now, you will be priced out forever, blah, blah, blah…”..
Anyway, I will not go into the coversation as to why that is impossible and stupid, we all have discussed it often here. But the thing that really gets me; “Why would you throw money away on rent”.. That question kills me.
People who feel like they “have” to buy right now, are, imho, idiots. I can rent a 750K home in a fantastic neighborhood for 2000-2500/mo (3/4 br, 3 ba, SF home, 1-4 years old). What posseses these people to feel that they “must” buy a home right now. If 3000-4000 sq/ft is not enough, I know another development where you can rent homes in the 1-5Mil range (5000-15000 sq ft) for between 5 and 15K/month. There is just absolutly no reason anyone has ever given me as to why they “HAVE to buy right now”.
However, the flip side does not hold at all. That guy renting you the 750K home for 2500/mo. He NEEDS to sell; and needs to sell in a hurry. He is losing between 3-5000 a month renting it to you; he is the one bleeding, not you.
My father, an accoutant, has told me over and over, its MUCH easier to buy something then to sell it. We are in the drivers seat (those that have money/credit/good jobs) no the RE agents or flippers/sellers. I can go on renting for years if need be; trust me, I have budgeted 2-3X my current rent as a reasonable housing payment. Every month I rent just puts more money in my account for a downpayment on a home. Once I feel the prices have returned to earth, then I will start to look.
I repeat, NOBODY needs to buy. Lots of people need to sell. Don’t be the person who jumps too early. Take a look at “high end” rentals in your area, I think you are going to be shocked (I know I was) at what your budgeted home expeses will get you in the rental market.
BTW, although I would never do this… I am figuring my housing expenses to be around 5K/month (all inclusive) when I do purchase (looking for a home in the 500K range). Anyway, take a look at what you can rent for 5K a month in Palm Beach (island, not West Palm). 4,500 sq ft home on (not near) the ocean?
Its tempting, but I really want to stay more in the 2-3K/month range for rent.
My neighbor is moving to a suburb of Ft. Worth because of his job. The wife is thrilled because she talked with local TX realtor and the realtor said that these big new 700K tract homes can be had if you offer 10% BELOW asking price.
I told her that if the realtor said 10%, DO NOT buy anything unless you get 30% off. If you make 10 offers at 30% lower than asking, 9 may tell you to get lost and one may counter really close to your initial offer.
I only did this after she said that they won’t rent. I wasn’t going to get into a pi$$ing match with her on why she should rent but only to counsel her on trying to save her another $140,000 on a purchase.
She pretended to listen but didn’t know if it stuck.
In many areas of the country, there is little or no rental housing of the kind that a middle-class family would want to live in. Until the recent low interest rates and ridiculously loose lending standards set the market afire, there was no reason for people in those areas not to buy, so there was no demand for such rentals. And when prices took off, the supply of housing that might have been rented was further reduced by homes being taken out of cirulation for pre-flip renovation. I anticipated this crash even before this blog started up, and was looking around on the web for something to rent in my area, but until about six months ago there was hardly anything available. The number of rental listings is now about seven times what it was in January. But when I think about renting one of these homes, I have to wonder just how good a landlord an FB is going to be. And anyway, the rents asked for most of the available places are ridiculous — about the same as the mortgage would be if you bought (and of course they’re not moving). The people owning these places aren’t professional landlords, they’re FBs who are going to be toast in the not too distant future, but are in denial — to lower either rent or price to the level at which the property would move would mean facing up to the brutal truth that they are ruined, and they’re going to put that off in hopes of a miracle just as long as they can.
I apoligize for posting 2X in a row, but I have one other question for discussion.
What do you think it does in high end neighborhoods when rentals are so inappropriatly priced as compared to home costs? For example, lets say I want to spend 5K/month on rent. Well, in PB county, that will get me a home with a “value” of right around 1.5-3 mil (depends on the area, and how desperate the person is to rent). Anyway, although 5K a month in rent is a big ass rent, its nothing like my “neighbors”. I am in the 150-200K/yr range, they are more like 500-1mil/yr to afford a home @2-5 mil dollars.
Anyway, I just wonder if this has a depressing effect on the neighborhoods? Kind of like when a slumlord takes over a home in a middle class development and rents it out to 15 famlies? I have trouble considering myself poor, but compared to people living in multi-million dollar homes, I may be “that poor fella” down the street.
Just curious, I have never really heard anything about this one way or the other.
Just curious, I have never really heard anything about this one way or the other.
We are in just such a situation, although on a smaller scale, but we NEVER mention how cheap our rent is. NEVER. For a seconds worth of sheudenfreud (sp?), we get the aimosity of the recent FB’s? Not on your life!