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1-I don't know yet. A lot of people were waiting to sell. I don't know if they'll still wait or price to sell. It has gotten more difficult to find specific homes when someone wants something very particular since there are fewer homes on the market.
2-Varies from seller from seller. I'd say overall there is no difference because people have always to sell for more than the market will support. There were overpriced listings 2 years ago and there still are today. (I'm not saying all houses are overpriced, but rather some of the homes are priced higher than the comparables will support.)
3-The only real difference is that they are employing a hold and rent strategy more often than a flip. They'll sell and make a nice profit down the road. Investors are loving the market.
In Chicago the "spring market" starts as early as the start of the NFL Playoffs (if the Bears are not in 'em that leaves lots more time for open houses) or as late as March. In either event there are just very few sellers talking to real estate agents about listing NOW...
There are and HAVE ALWAYS BEEN many sellers that have an inflated view of their home, but IN GENERAL there are FAR MORE homes that are priced close to a realistic price, which an openness to REASONABLE negotiation, but there are JUST TOO FEW BUYERS who have the will / ability to pay realistic prices. I think the broader "smack down" of economic woes is a bigger problem than anything else.
There are still some NOT RIGHT IN THE HEAD folks that ARE still buying places to flip -- I have no idea why they are risking the capital to do this when there are SO MANY very acceptable houses that are not selling. I can only guess that for some people drywall dust, paint fumes, and caulk are an addictive mix... I also have no idea where this people are getting financing to do this.
1-I don't know yet. A lot of people were waiting to sell.
When you say "waiting to sell"..
Do you mean waiting for spring, when more buyers are out and about? Or do you mean they are waiting for some sign of a rebound in prices?
(FWIW, I get the impression that many folks expect both to happen simultaneously.. our mayor, a R/E agent, was quoted last week saying that prices and buyers WILL return in Spring 09..)
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2-Varies from seller from seller. I'd say overall there is no difference because people have always to sell for more than the market will support.
Is this limited to sellers who paid more than the market currently will bear, or are you also including people who have owned for decades, and have flexibility in pricing?
Do you mean waiting for spring, when more buyers are out and about? Or do you mean they are waiting for some sign of a rebound in prices?
(FWIW, I get the impression that many folks expect both to happen simultaneously.. our mayor, a R/E agent, was quoted last week saying that prices and buyers WILL return in Spring 09..)
Is this limited to sellers who paid more than the market currently will bear, or are you also including people who have owned for decades, and have flexibility in pricing?
As you said, many expect(ed) the market to be more of a sellers market in the spring so I'd agree with both. I don't know that prices will return as quickly as the spring, but I think the buyers will return.
It refers to the sellers who are money motivated and not time motivated. Time motivated people still need to sell by X date regardless of price.
The "time sensitive sales" are usually driven by job offers, and I fear that some job related transfers may be headed to the ashcans as employers decide the job is not worth filling or can be done without relocating people... That was not uncommon the last time there were big drops in employment related ti tech bubble and 9/11.
I do see some well-priced homes out there. A well-kept one came on the market yesterday in a neighborhood I want, priced at 4% annual appr. since '03, and 4.5% appreciation since 1983. Those are numbers I can live with, you know?
So there are some that I know good and well will sell at their prices, when the right time comes. The bulk of the market, though.. I don't know. I don't even think a Spring full of motivated buyers will help them.
I would not focus too much on the rates of appreciation. I realize you not as strident as some, but the mindset is not really going to help you determine if the house is a good value nearly as much as simplly comparing it to the comparables that are in the same neighborhood and of similar age, size and condition.
Homes that do not compare favorable is the a,s&c often are outliers -- some tiny place might be very appealing in a rising market when people are panicky and in hurry to get into a good neighborhood, but without imporvement it may prove unworkable for a family. At the other end, houses that are either much larger or much more tricked out than the neighborhood norm may initially sell for more than the average, but they can becom 'white elephants' when no one wnats to support the increased costs of some 8 bdrm monster or pay the taxes on it....
I think you are smart enough not to consider something that will become an albatross, but it is easy to get caught up in "back calculating" what some theortical price for some house might be, and lose sight of the FACT that dissimilar house move at different rates...
I would not focus too much on the rates of appreciation. I realize you not as strident as some, but the mindset is not really going to help you determine if the house is a good value nearly as much as simplly comparing it to the comparables that are in the same neighborhood and of similar age, size and condition.
Yeah, I guess I didn't mention the details. It has always been a remarkably stable neighborhood, best schools in the area. Not traditionally a FTHB neighborhood. Right now it is like a wonderland of 1,500+ sqft 1960's ranch homes with 1970's appliances, lots of wood paneling. Big houses with big yards, lots of potential.. but every house needs updating.
Other buyers (my competition) all seem to want open floor plans, small, clean, new, and updated, so 7 or 8 empty ranch homes have been involved in this year-long standoff. $140/sqft for the good ones, $110/sqft for the unkept ones. Reasonable, I guess, but not enough to push me off the fence. Then suddenly this guy (the 4% appreciation house) crashes the party, coming on the market with an immaculate house for about $105/sqft, newer, bigger, and nicer than everybody else's.
I was beginning to give up, maybe there is hope for me yet.
Assuming that nothing is "wrong" with the house, and size does not push it into the "behemoth" category that could make it a White Elephant, the situatuon could be exactly the kind of 'motivated seller' that does makes it attractive to buy in...
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