Pricing To Sell
The Chicago Tribune reports from Illinois. “In an effort to turn around a slowdown in sales of units in his luxury tower being built along the Chicago River, developer Donald Trump on Thursday will meet with reporters to deliver a message: He’s got a sale going on. ‘We’re pricing to sell,’ Trump said about his 825-unit Trump International Hotel and Tower now under construction. ‘People think we’re sold out but we’re not.’”
“Of the 825 units in the 92-story tower, 224 condominiums are still for sale. Trump is hoping that his appearance will help at a time when he claims Chicago’s sluggish housing market is hurting sales.”
“‘There’s no question, the market has taken a serious hit and is slowing,’ Trump said. ‘But it’s a great time to buy in our building because we aren’t raising prices.’”
“Since January, Trump has sold only eight condominiums in the tower, which will cost about $775 million to develop, he said.”
“‘With the market in upheaval, price discovery is difficult,’ said William Testa, a senior economist at the Federal Reserve Bank of Chicago. ‘Developers are reluctant to lower prices but buyers have expectations that prices will fall.’”
“Indeed, Chicago condominium sales declined about 45 percent in the first quarter from the year-ago period, according to Appraisal Research Counselors.”
“At the same time, residential developers are planning to deliver a record number of new, downtown units. From 2007 through 2011, they are slated to build 16,300 for-sale residences for an area with about 90,000 existing dwellings.”
The Grand Rapids Press from Michigan. “A Dallas-based company added Grand Rapids to its list of Michigan cities with a growing number of foreclosed properties. The company held auctions in Detroit, Battle Creek, Lansing and Jackson earlier this week, and is to do the same in Muskegon today.”
“More than 500 properties were up for sale from May 19 through today as part of the event, about 300 of which were auctioned off in Detroit. Hudson & Marshall is hired by lenders to help unload the foreclosed homes.”
“Real estate agent Abby Cook said her agency and others are trying to keep pace with the ‘unbelievable’ amount of foreclosed properties. ‘The market is tough right now, and auctions are a quick way of selling off the houses,’ she said.”
The News Press on Wisconsin. “Bob Arnold, an agent in Mequon, Wis., has noticed the rising number of empty houses in his market. He thinks the trend offers some encouragement because some sellers have enough faith in market trends to take a risk.”
“‘We’re coming out of a gloomy fall market. If they didn’t do anything then, they’re saying, at least there’s a more positive atmosphere out there,’ he says.”
“Agent Edward Smith represents a Milwaukee house that has stagnated on the market for more than 24 months, plagued by a poor location and other woes. Its price is now $309,000, a far cry from the original $425,000.”
The Perry County News from Indiana. “In Perry County the number of foreclosures - and sheriff’s sales - have been on a steady rise, figures show. ‘Years ago we might see no more than 10 sales for an entire year. Now we have dozens,’ said Sheriff’s Deputy Richard Myers.”
“Records provided by the county clerk’s office show 93 foreclosures were filed in Perry Circuit Court in 2006, up from 75 the previous year. Thus far in 2007, 29 foreclosures have been filed, many of them by national lenders who issued large numbers of subprime loans over the past couple of years.”
“‘A lot of the big companies you’ve heard about are the ones who have a lot of the bad loans,’ said Myers, pointing to common names such as Countrywide Home Loans, HSBC, Ditech and Washington Mutual.”
“Several of last week’s planned sales were put on hold and will likely be readvertised in The News. Those sales won’t be far off, Myers said. ‘It never stops.’”
The Chaska Herald from Minnesota. “Through April, home sales in Chaska and the Twin Cities market have not kept pace with the annual spring growth seen in previous years, according to a Minneapolis Area Association of Realtors press release.”
“Year-to-date, Chaska home sales are behind 2006’s pace by 23.7 percent. For the entire Twin Cities region, closed sales are down 14.1 percent year to date and 12.2 percent down comparing April of this year to April of 2006.”
“‘It is conceivable that by the end of the year, the average price for all of 2007 will be slightly below that of 2006, and this type of corrective price change is not unique to the Twin Cities’ stated Deb Greene, president of MAAR, in the release. ‘Markets throughout the country are experiencing the same readjustments following the frenzied price growth of the boom years.’”
“‘Interest rates remain very low, housing inventory is still robust and housing affordability has improved dramatically in recent months,’ said Kevin Knudsen, president-elect of MAAR. ‘With all the evidence of a fantastic environment for buyers, consumers will soon recognize that conditions are excellent for buying a home.’”
The Wichita Eagle from Kansas. “The rough winter of 2006-07 slowed the appreciation of homes in the Wichita area to the lowest point in three years. But analysts said it’s just a blip.”
“Home prices appreciated by 0.22 percent in the first quarter of 2007, according to a study released Tuesday by Wichita State University’s Center for Real Estate. That’s the slowest quarterly appreciation rate since 2004, said Stan Longhofer, director of the real estate center.”
“‘Activity certainly wasn’t robust in the first quarter, and I’m not quite sure why,’ said Connie Simcox, president of J.P. Weigand & Sons. ‘Weather certainly has an effect, no question.’”
“So does the widely publicized coastal housing market crash, said Bill Graham of Graham Inc. Realtors, as speculative increases in home values have outstripped demand. ‘Bad press from the national viewpoint affects the psyche of buyers everywhere,’ he said.”
“Wichita-area existing home sales fell 9 percent in the first quarter of 2007, and new home sales plummeted 26 percent, both bearing out the impact of the weather, Longhofer said.”
“But the downturn won’t take on statistical significance until and if it continues for another couple of quarters, he said. ‘If I saw appreciation rates were at an annualized rate of 1 to 1.5 percent for the next three or four quarters, then we’ve really slowed down.’”
“Wichita remains a seller’s market, Graham said. ‘We’re still considerably ahead of where we were last year,’ he said. ‘We’re still getting multiple offers on the prime houses. We’re still selling listings at or near cost. But if this trend continues, you’re going to have a totally different look.’”
Poor Donald. He’d have fewer condos to have to sell now if he hadn’t jobbed those early buyers out of their condos when the market looked hot.
‘We’re pricing to sell,’ Trump said about his 825-unit Trump International Hotel and Tower…”it’s a great time to buy in our building because we aren’t raising prices.’”
How does “not raising prices” equal “pricing to sell”?
“pricing to sell” in five years.
“Of the 825 units in the 92-story tower, 224 are for sale…Since January, Trump has sold only 8 condominiums in the tower.” Hmm, I guess “since January” is 4 months. If so, there is actually a 9-year inventory.
Factoid:
Wasn’t this project managed by Bill Rancic who was
the winnner of Season 1 of the “Apprentice” TV show?
Yes! I wonder how much authority he really had over the job though. I can’t imagine some reality tv show winner dealing with the Daley, the city of Chicago, the unions etc…
“Bill Rancic” yep. Damn this one just made my day. Maybe next season Donalds whole show will be devoted to the marketing and selling of his RE properties. BTW, how’s that house down in FL?
I think “The Apprentice” is not scheduled to return to NBC’s schedule.
“Poor Donald. He’d have fewer condos to have to sell now if he hadn’t jobbed those early buyers out of their condos when the market looked hot. ”
EXACTLY what I was thinking. This couldn’t have happened to a skeezier of guy.
what a prick. He sells pre-sale condos to his friends and family in order to secure financing. When it’s all said and done, he screws them out of the deal so he can re-sell the condos at higher prices.
now the condos are falling in value!!!! If only those friends and family realized what a favor he was doing them!
what a prick.
(it was 42 friends and family)
http://nreionline.com/property/multifamily/real_estate_trumped_donald/
When you do business with Donald, you know you’re going to get screwed. Seriously, is this ever not the case? And as always, Trump is late to the party, building when the market is tanking, and avoiding bankruptcy because he’s playing with other people’s money.
“Bob Arnold, an agent in Mequon, Wis., has noticed the rising number of empty houses in his market. He thinks the trend offers some encouragement because some sellers have enough faith in market trends to take a risk.”
“‘We’re coming out of a gloomy fall market. If they didn’t do anything then, they’re saying, at least there’s a more positive atmosphere out there,’ he says.”
-”sellers have enough faith in market trends to take a risk.”
WTF.
That’s one big case of denial.
More positive atmosphere? NO! More desperate sellers who are watching the sheriff come up to the front door to post his notice.
“We’re coming out of a gloomy fall market.”
Methinks it’s more like heading into a gloomy fall market.
The whole greater Milwaukee area RE health, as well as the rest of Wisconsin is RE scene, is wobbling between stagnant and stone dead. The inventory in Milwaukee according is growing at a rate of about 200 per week with few sales.
All Residents that have not Fled, Run or otherwise Escaped, will be required to attend the Funeral Services this Fall.
RIP
Sobay, I thought the same thing. There’s nothing like increasing inventory to make you want to jump in and put your house on the market.
My neighbor heloced into a fixer upper. Then refied into $200k worth of fixes. Now I can see the hair falling right out of his head everytime I walk out to get the mail.
I’ll check with him tomorrow to see if he thinks its a more positive atmosphere!
“Trump said. ‘But it’s a great time to buy in our building because we aren’t raising prices.”
M098475er Fu093845er.
Seriously.
So says the captain of the Titanic, “There’s no question we’ve taken a serious hit and are slowing, but it’s a great time to buy because we aren’t raising prices…”
Or “for a limited time we are offering our steerage passengers a reduced-price upgrade to a first-class suite. Please see the capitain, if you are able to climb the 45-degree angle of the deck up to the wheelhouse”
It’s JUST an minor Ice Ding in the boat Folks. If we go Fast, we CAN outrun it.
Trump’s not selling much these days because there are at least 3 other high-end projects currently underway that offer better elegance AND better value. Not to mention that with the project clad up to about the 30th floor, it’s now very clear to all prospective buyers that Trump checked the box next to “funhouse glass” when he ordered the material. Well, at least it’s not gold-colored glass. I feel sorry for Vegas.
Other things he’s done this year:
1) Canceled the purchase contracts for all the earliest buyers
2) Insulted Chicago architecture
3) Got permission to build a public info/map thingy on Chicago’s most prominent street. When finished it becomes clear that it’s nothing but advertising for Trump.
Oh yeah, we’re lining up to give this guy money
I actually love the curtainwall. I hate the tower desigm, but the glass and polished stainless steel mullions are really quite beautiful. One of the best curtainwalls anywhere lately. By Chicago SOM, the best of the SOM offices.
This guy doesn’t even look human.
http://news.yahoo.com/s/nm/20070524/bs_nm/usa_subprime_future_dc;_ylt=Ap8jpgsK8c2.0jQ8ao9q6S6573QA
Perched on an arm chair on a ballroom stage, Mozilo, who made $387 million in pay and stock options over the past five years, disavowed blame for the collapse, pleasing his audience of fellow mortgage-banking industry leaders and foot soldiers.
Is he going to do a Bernie Ebbers, denying any responsibility and then promptly taking the Fifth in hearings?
There’s too many pissed off homeowners looking for someone to hang. This guy is done for. The noose is starting to tighen around his neck.
He made $387 million. If it gets too hot down here he’ll be living on the space station like that rich eccentric from “Contact”. Just like when Ken Lay “died” right before sentencing
He needs to see a plastic surgeon for total face reconstruction.He is one of the shadiest looking dudes I have ever seen.
for one im still wondering about the timing of his demise
Nobody is worth that kind of money. Nobody.
Tan-trywide Loans…
kinda like the Lou Gosset Jr. part in Enemy Mine
Now, Chick, didn’t your mother tell you that it’s unkind to make fun of what other people look like? (Slim types this while chucking.)
Heh, heh - here’s what he reminds me of:
http://gamerscircle.com/thing2main.html
Hmmm…first case of succesfully barbequed human?
Or maybe he’s related to ET?
http://tinyurl.com/6f8va
A guy that wears a suit for a living should never be that tan. I can see a construction worker looking like a leather jacket but not a CEO.
I used to work with a woman who looked just like that. We had a nickname for her- “Ole chicken skin”.
Apologies to Blue Oyster Cult:
History shows again and again,
How nature points out the folly of man…
MOZILO!
Dum Dum Dum-dum-dum Dum Dum Dum-dum-dum…
Oh, no. They say he’s go to go.
Go, go Mozilo…
Wasn’t he on Star Trek? -
“Since January, Trump has sold only eight condominiums in the tower, which will cost about $775 million to develop, he said.”
224/8 = 28 and 28*5 = 140. At this rate Trump should be done selling the last one around 2019
Ironically, the world’s biggest cry baby screwed himself when he cancelled those contracts. Buyers had to think twice before doing business with this shark, and I am sure this cost him some sales. And now this may even cost him sales in any future projects.
Got 10% down?
got Ngas ?
“Wichita remains a seller’s market, Graham said.
I would be willing to bet any of you folks in California know at least one person who refied/heloced into an addition or investment home etc. on neg am or interest only. It is true many thousands are hanging on by their nails… it will take until 2009 in my opinion for these folks to finally give up the ghost in great numbers. I believe this will be the big down-turn year.
Any thoughts?
Ha, ha. Moved here in 2005 and rented a 2 br/ 2 ba condo. Got a good deal compared to other condos. My landlady promptly gets a HELOC within 4 months of me renting. Has to pay for a busted-beneath-the-slab leak out-of-pocket because she was to cheap to buy insurance that would cover that kind of scenario. Now, she is trying to sell if for the last three months with no offers and she hasn’t paid for the property tax on it this year.
The only reason I’m staying there is that it is still cheaper to rent from her and risk losing my deposit than to go find another place that is more expensive and pay for moving expenses. Hopefully, she can hold on for one more year so that I may move out of state and find a company willing to pay for me to relocate (which I don’t think will be too difficult).
I am seeing things sit on the market much longer here too. I fear for some of my friends who are in neg-am loans that closed in 05-06. Man if anything happened to their jobs or they needed to make significant repairs there is nothing left for them. Then if they need to sell they may not be able to for what they need. These are smart folks too… scary man.
“I would be willing to bet any of you folks in California know at least one person who refied/heloced into an addition or investment home etc. on neg am or interest only.”
One person?? How about just about everyone I know. I’m serious. Everyone I know who bought in the last 2 or 3 years has an adjustable IO loan. Everyone who has been in their home longer and has equity has tapped it, in some cases, tapped it out. I know people who are pulling money from 401K’s to pay property taxes on multiple “investment” properties. People taking out HELOC’s to cover private schools for their kids. I don’t know anyone who isn’t stretched.
People did this on blind faith and dumb greed. The greater the leverage, the greater the potential for “profit.” There’s a GF to bail out every homeowner, so spend away.
It’s a total house of cards for a lot of folks.
Holy cow. Thats a mess.
My smart friends told me they never wanted to have more than the minimum equity because they only wanted to control the smallest part possible of the cost of the house. I told them that reverse leverage is a nasty thing. I don’t think they will listen. They just invited us over for a party in their back yard (redone - heloc - hello) … they blew thousands on back yard furniture but not to worry… 6 months zero payments on that deal.
look out below
If they are using their 401 k’s to delay the inevitable then this will go on for some time - 2009 like jonaskinny posted - or longer before they capitulate. And when they do throw in the towel, there will be no 401k left. These greedy people trying to finance their way into riches will have to start their retirement savings all over again!
Got 10% down?
My neighbor is moving to Chicago in 2 months… gonna rent out his townhome in our development (so-cal). I asked him if he was gonna buy or rent. He said ‘what are you kidding me? Im renting for a while’
He handles military housing closings nationally for a firm in Chicago.
I love these idiots. We have an 11% decline in new home prices IN 30 DAYS… and we get this:
“With the housing market showing clear signs of stabilization, the bond market is likely to expect the Fed to remain on hold for the foreseeable future,” said Michael Pond, Treasury and inflation-linked strategist at Barclays Capital.
wow.
Of course he is going to say that. He needs the market to stabilize so Barclays can structure more CMO Deals in the future.
Keep in mind that’s a median price (the same median we’ve been complaining about) and that the reason the decline looks so nasty is that the greatest portion of the sales came from the South. i.e. where home prices are lowest/
“‘Activity certainly wasn’t robust in the first quarter, and I’m not quite sure why,’ said Connie Simcox, president of J.P. Weigand & Sons. ‘Weather certainly has an effect, no question.’” Also if new and existing home sales are down YOY, how can they be considerably ahead of last year? WTF?
So . . . “not quite sure why” out of one side of the mouth and “weather has an effect” out of the other . . . hmmmm, here’s a hint, shut your piehole already.
I lived in Wichita for 36 years, good working class town, good medical center, good manufacturing base, university jobs, etc. But, air service and weather suck and it’s 3 hours from anywhere.
Oh yeah, it’s different there.
Sorry to repeat a post from yesterday, but it certainly fits this topic…
———————————————————————————
JANE LINDHOLM: If you’ve ever been to a cattle auction, you’d be well prepared for a housing auction. Except instead if discussing hoof quality and bloodline, it’s all about square-footage, bathrooms and garages.
HOUSE AUCTIONEER: All right, number 34 in the brochure folks. This is at 39859 Chippewa Circle in Murieta. It’s a four-bedroom, two-and-a-half bath. It’s $219,000 starting bid. Here we go: 219, 250, 219, 250 . . .
At the Riverside Convention Center an hour outside of Los Angeles, about a thousand people with brochures and paddles sit in folding chairs as the bidding starts. On a big screen is a picture of a two-story house with a market value of $420,000
Two minutes later . . .
HOUSE AUCTIONEER: Last call for 300,000, 290 now 3. Anyone else at $300,000? And I haaaaaaaaave sold that $290,000 subject to confirmation.
The 98 houses at this auction have gone through foreclosure and are being sold by the lenders who now hold the titles. Auctions like this are happening more frequently these days as the number of foreclosures is rising.
http://marketplace.publicradio.org/shows/2007/05/23/PM200705234.html
I am seeing AWC (active with contingencies) on a lot of AZ listings. What is the typical contingency on a listing that would cause it to be an AWC listing? Is this saying its active for sale but is in Escrow where the buyer has a contingency?
Yep
The most likely contingency to last any period of time is the sale of the buyer’s house. Most other contingencies can be removed in a couple of weeks (termite inspections etc).
In England they are called real estate chains. At times there can be 4-5 houses all in the chain waiting for that one last house to sell. Until recently most sellers wouldn’t entertain contingent offers.
“I am seeing AWC (active with contingencies) on a lot of AZ listings”
I would charcterize most of these “AWC” listings as generally weaker deals than “Pending” listings. A house under contract is supposed to be changed to Pending as the default status, unless the agent is instructed to list it as AWC. Of course, plenty of Pendings fail to close as well.
AWC also continues to rack up “days on market,” whereas Pending stops that clock. There are contingencies in almost any RE contract, but AWCs are probably something significant like the buyer must sell another house, which would be tough to wait out in Metro Phoenix.
“I’m not sure why”. or “Retail sales are slow because of the weather.”
How come we understand, but nobody else seems to?
Turns the whole concept on it’s head, when the “professionals”, who after all are being paid to understand, don’t know jack, and us, who are just interested observers, seem to understand so much.
Now, if we could only start getting paid for this insight! It’s a bit like dreaming the winning lottery numbers ahead of time, not buying a ticket, and then seeing your numbers come up - Wow, I was right!
My wife would say - Why didn’t you buy a ticket then, dumbass?
This part really bopped me over the head:
“Agent Edward Smith represents a Milwaukee house that has stagnated on the market for more than 24 months, plagued by a poor location and other woes. Its price is now $309,000, a far cry from the original $425,000.”
Ummm, isn’t $309k still a bit rich for Milwaukee blood?
Slim…All those rich people from Chicago WILL be driving up with bags of Full of money
Any day now…any day now…any da
Not really. Milwaukee has some nice areas. High property tax rates too.
There are some nice areas in Milwaukee if you like very older, well worn houses or paying through the nose for a McMansion to be near the Lake on the east side.
There hasn’t been a lot of newer reasonably priced houses built in the city of Milwaukee proper since the 1950’s because there isn’t much room or incentive to do so.
Yeah, I think they meant Milwaukee when they said “plagued by a poor location.” Notice they didn’t say “bad location within Milwaukee.”
(I’m from Cleveland, so I’m allowed to bash)
I lived in Clevalnd for 4 yeras. Probably the nicest suburbs I have seen. Cleveland heights , Shaker heights university heights. And cheap! I miss that city.
Oh yes, paint your buttons yellow so you remeber what the sun looks like.
why would they bring a realwhore at an auction
mang, some folks are stuuuupid
http://marketplace.publicradio.org/shows/2007/05/23/PM200705234.html
for real… what’s up with that?
Not uncommon I have clients who do that all the time from Lawyers and Investors to the common joe. Some even find the property and then have me represent them. I ask them wtf do you need me for especially with the attorney’s after I had semi-retired from the business. The answer varies but it mostly comes down to a security blanket complex I guess. Although one does it too specifically annoy me his words not mine… But the others I don’t understand the logic. But they do it.
I don’t know what priced to sell means anymore. I really question whether the advice, “price, price, price” means anything.
I put my place up for sale last month FSBO, so I could still get close to what I wanted to walk away with, and have the leverage to drop the asking price without having to consider an $18,000 payment to real estate agents. I priced 20% below peak prices, and $21,000 under the latest assessed value of the house.
I spoke with a real estate agent about a home he had listed, and we got into conversation about my place. He knew the area, considered a good part of town, knew the street even. He asked what I had priced my place at and he literally gasped, saying that was quite low for the area. I then got a bit of a sales pitch about how he could get me more. I told him I didn’t know how as I’d do nothing but raise the price 6% plus in order to do that, and I wanted to sell now, not 6 months or a year down the line. I also don’t want real estate agents, their clients tromping through at all hours or with their open houses.
In 3 weeks I’ve had 6 showings, about 4 dozen flyers pulled, a few dozen clicks on Internet ads being run, but can’t even get a hint of an offer. People like the house, one man spent 3 hours here, sat down and had a nice chat (that’s the way I negotiate and sell - calm, easy, relaxed). The only restrictions I place on a potential buyer relates to their financing, I won’t pull it off the market while they hunt for a loan, unless they’re willing to risk a 1% deposit on their ability to get a loan.
Frankly, I am beginning to wonder if I’ve not priced it too low. Comps in the neighborhood are going from $5000 to $35000 more. I’m going to ponder this over the weekend, and may just jack it up $10000 and see what happens, or call in the agent and increase it $25000.
It’s a good price for the area, in fact an almost unheard of price. I can’t figure out what’s happening here in Southern Nevada. I sold my last home FSBO 24 hours after putting up a sign at a high price.
forget the agent
offer to pay him net and watch what happens.
he’ll run away
I’ve never done an fsbo before but have an idea if I do (I live in a subdivision of similar homes). Do you put a price on your fsbo sign? I would think that would draw a lot of attention as people could clearly see that your home is lower priced than the other non-fsbo homes in the same area.
Yes. I have two signs, both showing the price in numerals large enough to be read from the street. I make sure there are always flyers available, which include color photos, and a floorplan of the house. I won’t publish interior photos for two reasons, first they show little really, and second I don’t want to broadcast what’s in the house and where it’s located (electronics, things like that).
Selling FSBO isn’t really that hard. With the information on the Internet, you can easily come up with a price. The title company or escrow officer takes care of the rest. You’ve got a little extra work, but it sure isn’t 6% of the price of the house worth. Be forthright about required disclosures and don’t try to fool the buyer, and you can get along very well, it’s not an adversarial relationship. Also, who better knows the house than the person living in it? I know when, or if, I get to the point of going to look at the model home I want, if it’s a resale I’m going to ask that the owners be there. I’d rather talk to them than to their agent.
Unless the outside is spectacular, I suggest putting out some interior pics. If you look online you will see that listing with mulitiple photos always get more traffic. Interior pics will allow someone to see how much work might or might not be required to make them happy (seeing a new kitchen is 1000x better than a bullet point saying “updated kitchen, new SS apps”
totally agree. In this market i would not go see something unless i either knew what it looked like or my agent had previewed it for me… and since this is a fsbo and wont be on any buying agent’s list he should put out as many photos as he can
I think that the buyers’ real estate agents shun FSBO houses.
They make subtle discouraging statements to their clients.
Maybe if you’re ready to pay 3% to the buyer’s agents, that will bring in more traffic?
Also, many people use MLS as their primary source of information, so if your house is not there, you may be missing half of the possible buyers, or more.
yes he absolutely needs to pay a few hundred bucks and put it on the MLS.
If you’ve had lookers, but no offers (not even hints) than it doesn’t sound like it’s priced too low. From what I’ve heard, people tend to look at houses in a certain price range, 10k is probably not going to attract a completely different set of people. Even if it seems too good to be true, I still think people originally shopping for something a little higher while stop by (that is if they have good knowledgeable agents who know the area). Personally, I wouldn’t raise the price, but that’s just my opinion.
pay a few hundred bucks and put it on the MLS.
Here’s a tip from a broker. Depending on your area most folks are scared of FSBO’s most are considered nutjobs and in most cases they are… Compound that with the fact that inventory is up in most places and subprime is buh-buy. The buyers left in the market are probably literally riding in the backseat of some agents car or more inclined to use an agent. Contrary to the chirpings here most buyers are not buying houses off the net nor will they feel comfortable doing so. That won’t become commonplace for at least 10 years if then. Interview the top three “listing” agents in your area. Price 10% below the average of their CMA’s pay a half point bonus to the selling agent and offer to pay closing costs. Your house will be gone in about 2 weeks.
It’s a different market then when you sold last time. Requires a different strategy. Save the slay the agent hyperbole for another time gentleman. I’ve heard it all and really not interested, unless you are going to drop your price 30-40% going solo is probably not the wise thing to do right now. if you need/want to sell now.
“…sat down and had a nice chat (that’s the way I negotiate and sell - calm, easy, relaxed). …”
Definitely not going to work in this market…
“The only restrictions I place on a potential buyer relates to their financing, I won’t pull it off the market while they hunt for a loan, unless they’re willing to risk a 1% deposit on their ability to get a loan.”
Too much available inventory on the market for this type of nonsense.
Thank you all for the opinions and observations. I’m going to consider them all. I own my home outright, so am not pressed by finances to sell which means a lot. I was hoping to get it sold and into something smaller and more manageable for health reasons which are worsening. It was really a race against the grim reaper rather than a realtor. The house is a complication that can most easily be solved by selling and buying another, I won’t go into the details here, and wanted to protect the last remaining family member. She may have to deal with the complexities on her own. Thanks again for the good advice.
I understand, here’s a question… what’s more important spending the remaining time with a loved one or trying to corral a buyer in a screwy market.
Here’s another tip… find an attorney to assist the remaining family member when the time comes if you or she feels she would be incapable and enjoy the time before the grim reaper finishes the race. Screw a FSBO and a Realtor.
can someone tell me what a monthly payment would look like on a $1.7 million mortgage loan at @ 6.25% and I/O? I was just talking to a friend whose friend just bought a 1700 sq ft. house on SF bay (looking at the Golden Gate Bridge)…they are using an I/O mortgage…I don’t get this stuff
Thanks!
wtf? they must be earners but gosh interest only on 1.7mm?
if you need interest only you should not be borrowing 1.7mm…. its like needing to lease a bentley… if you cant write a check for it you should not be buying a luxery item in my opinion.
1,700,000 x .0625 = 106,250 in interest per year
Monthly payment is 8,854 + insurance + taxes + HOA, etc.
Holy Sh*t, that is outrageous….I really don’t understand it and probably never will…what is the biggest danger in them using the I/O other than not building equity? I myself would never use I/O but I am just trying to wrap my head around why they are doing this… I understand that SF is ridiculously overpriced but why are people still buying? They probably make at most $400,000 gross a year and they have a baby on the way…they just sold a house in SF for probably $500,000 (it was a two family that sold for $1 million and they would have received half)..
well you can qualify on the initial payment vs. fully amortized payment these days (we had these loans in the past but they required stellar credit, real equity, reserves, and documented income…. qualifying at the fully indexed rate or at least 2 over the initial rate) so this will shoe-horn their butts into the house of their dreams. People without alot of long-range thinking will typically stretch to whatever they can reach… just warn them that reverse leverage is a very nasty thing and happens when its least convenient.
A fully amortizing 30 year fixed-rate loan at 6 1/2% (don’t know if that’s the going rate but must be close) would be $10,745/month. Looks like they’re “saving” a couple grand a month.
oh, and what does “HOA” stand for?
Home Owners Association. Correct me if I’m wrong here but I think you pay into an association fee to pay for neighborhood landscape and things like that.
It is unlikely that the area of town they bought in has an HOA, as it will be urban (in the city) either in San Francisco itself, or perhaps south Marin or maybe the west part of the East Bay given that it has a view of the GG bridge.
1,700,000 x 6.25%= $106,250/year
plus property tax (which is 1% of purchase price in CA)
1,700,000 x 1%=17,000
so $106,250 + 17,000 = 123,250
divided by 12 = $10,270/month
Plus insurance (which will be at least another $700/month or so, probably more)
This can be done on $400,000/year salaries, but would be more tight than you would expect. Especially since they will for sure hit the AMT, so the mortgage deduction is NOT going to help them. (they have several hits against them when it comes to AMT so they’ll hit it for sure).
They might not know about the AMT yet, but they will. (I remember when I hit the AMT, how much more tax I had to pay under AMT…it sucked)
If you follow the Wisconsin article there is a picture on the right hand side. This is part of the caption:
“If cleaned properly, an empty house can be attractive, but sometimes an empty house sends a signal of desperation.”
That just about says it all.
“Bob Arnold, an agent in Mequon, Wis., has noticed the rising number of empty houses in his market. He thinks the trend offers some encouragement because some sellers have enough faith in market trends to take a risk.”
“‘We’re coming out of a gloomy fall market. If they didn’t do anything then, they’re saying, at least there’s a more positive atmosphere out there,’ he says.”
this guy is a dope. It means they cpaitulate like all the rest of the re gurus at the bottom.
he also thought getting rid of paying renters so the seller’s cleaning efforts would last longer was a good move too.
Boneheads.
“‘There’s no question, the market has taken a serious hit and is slowing,’ Trump said. ‘But it’s a great time to buy in our building because we aren’t raising prices.’”
Hey mop head taking a few lessons from Lereah i see.
Can’t believe a word that comes out of anyone’s mouth who’s name starts with The
The Donald
Watching the news today they make it sound like good real estate numbers.. geez this thing will take awhile… may need to refill the popcorn tub!
No…90% of the MOM increase came out of the South, 122k of the 133k jump. That Southern increase is THE largest South regional MOM increase ever. And whenever MOM’s have jumped by 2-digit amounts, they always fall the next month. Some very funny numbers here.
Here’s a financial tip (warning) about buying ANYTHING in this market if it isn’t yet built, like the Trump building, and ready for occupation and you know the title is free and clear. I think we are going to see a lot of bankruptcies and if you have put down a deposit on a yet to be built home or condo, good luck getting your money back if the builder goes belly up. The days of buying for $400,000 before the property is built and selling for $600,000 24 hours after it’s finished are OVER. Better still, stay out of the property market for at least 2 or 3 years and possibly longer depending on the economy AND do not listen to government reports that the economy is doing very well and ignore the fake inflation numbers and unemployment numbers. In fact, if you have put money down before a property has been built, try and get out now by using some excuse or other. We are nowhere near the end of this mess.
So true on the deposit thing…. The next waive will be lease-option payers suing their failing land-lords for their option payments when the owner goes belly up and the lender punches it out at auction.
“Bob Arnold, an agent in Mequon, Wis., has noticed the rising number of empty houses in his market. He thinks the trend offers some encouragement because some sellers have enough faith in market trends to take a risk.”
Mequon Median Household Income $89486
http://realestate.yahoo.com/Neighborhoods/detail.html?csz=Mequon,WI
“Agent Edward Smith represents a Milwaukee house that has stagnated on the market for more than 24 months, plagued by a poor location and other woes. Its price is now $309,000, a far cry from the original $425,000.”
Milwaukee Median Household Income $32512
http://realestate.yahoo.com/Neighborhoods/detail.html?sa=&csz=53210&submit=Submit
Although only a short drive apart and demographically in DIFFERENT WORLDS, it’s NICE to know that both Realtors are enjoying their Hunger Pains equally.
Hey Donald, go jump off a cliff! And I’m glad they cancelled your idiotic show.
“‘There’s no question, the market has taken a serious hit and is slowing,’ Trump said. ‘But it’s a great time to buy in our building because we aren’t raising prices.’”
Cool, so you can lock in a high price for a non-appreciating asset!
“Agent Edward Smith represents a Milwaukee house that has stagnated on the market for more than 24 months, plagued by a poor location and other woes. Its price is now $309,000, a far cry from the original $425,000.”
$309k for a house in Milwaukee? What ever happened to “the bubble is confined to the coasts, no bubble in flyover”?