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Old 03-15-2010, 11:36 AM
 
28,455 posts, read 84,914,994 times
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No argument for relisted /reduced compared to final selling prices, but if the OP is working with an agent that is showing them places currently listed and saying that a 20% price reduction is common the agent is not going to be the one that gets the OP into a house in any kind of decent time frame. The places with very high time on the market are signs that the seller almost certainly has rejected offers when the economic picture was much more bleak. If you factor in the lending needed (jumbos are still not as plentiful as they were) especially at the price point that is sounds the OP is most interested in, the folks buying in the higher reaches are bringing a lot of cash from previous equity to the table.
Let's not discount the sub-markets too. There is big difference looking at a brand new (or completely redone) house that some builder originally priced at $1.5M eventually selling for $1.2M (a very significant and currently uncommonly large discount) and a shabby old place place that some one was asking $999k and settling under $800K. Although it is a similar percentage discount the actual comparables are much scarcer to support the higher priced property and some of that price reduction is /was motivated by a low appraisal forcing the seller to make concessions. The prices a step down are mostly prompted by the reality that compared to the higher priced home the value just is not there and the offer(s) from buyers force the seller to settle for a new reality where the teardowns and re-dos are just not part of the equation...
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Old 03-16-2010, 12:29 AM
 
1,989 posts, read 4,448,145 times
Reputation: 1401
Redfin.com currently shows Glencoe at a list to sale ratio of about 90%, Wilmette is slightly higher. With the ENORMOUS GLUT of high end homes on the North Shore, it wouldn't surprise me at all to find that they're selling at 80%. I am aware that some homes get a sense of what an interested buyer might want to pay and [i]then[i] drop the price so they're within the 90% range.

I'm also aware of MANY homes that were priced north of $1 million two years ago that sold for under that or are still on the market, gradually chopping away at that price.

Seriously, if you can wait and rent, consider it. There is a HUGE overhang of high end inventory. I've seen newly built vacant mansions on Sheridan Road go to foreclosure auction.

Have no idea what you can afford and I have no idea what interest rates are going to do, but if the $1 million+ homes on the North Shore don't drop further in price, I'll eat my hat, coat, pants and shoes. There are just too many of them and no more silly nothing down, no doc, negative am loans to support the market for them.

I truly think some of them will become group homes. With a bathroom per bedroom, they're perfect for it.

If you have to buy and are concerned about price stability, I'd go with Wilmette (opinion). As of January, it looks like they had about a 6 month supply of inventory in the $1-2 million range. Glencoe had over 13 months supply. No doubt more inventory was added to the pipeline since then.

Don't forget to watch the foreclosure trend line, too.
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Old 03-16-2010, 12:39 AM
 
1,989 posts, read 4,448,145 times
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Quote:
Originally Posted by chet everett View Post
There is big difference looking at a brand new (or completely redone) house that some builder originally priced at $1.5M eventually selling for $1.2M (a very significant and currently uncommonly large discount)
Honestly-- I've been watching this market for two years. It is not at all uncommon to see new construction drop that far or more in price.
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Old 03-16-2010, 07:59 AM
 
Location: Barrington
63,919 posts, read 46,434,424 times
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Generally speaking, the longer the property takes to sell, the greater the gap between both the original and last asked and closed sale price. Some of this is due to declining market and some of this is due to the original asking price being based on what the seller needed or wanted out of the sale, regardless of market conditions and/or a listing agent not understanding how markets work.

If the original ask is based upon very recent closed comps of comparable homes, the gap between original ask and closed sale price tightens considerably. Such properties continue to sell relatively fast and substantially closer to the original ask.

If one were interested in buying one of these homes and expected to pay 20-30 % less than the asking price, one is going to lose out on the opportunity to buy it.

Having an agent with very local market experience who knows the competition and closed comps and why a comp property sold for what it did, when it did, is critical in this market. The MLS does not tell the whole story.

( I do not work the shore and have no skin in this game)
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Old 03-16-2010, 08:57 PM
 
42 posts, read 132,978 times
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Quote:
Originally Posted by chet everett View Post
You are very correct to be concerned that you may be looking at places that will never come into your "zone of affordability". That wastes your time and that of the sellers.
I don't buy that at all. At worst the seller throws a tizzy because the buyer dared to suggest that their house was overpriced (which it invariably is in this market). If the seller doesn't want to play ball, they don't have to. It only takes a few minutes to come up with a counter offer, and it takes no time to simply say "take it or leave it".
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Old 03-17-2010, 10:25 AM
 
Location: Winnetka, IL & Rolling Hills, CA
1,273 posts, read 4,402,035 times
Reputation: 605
Glencoe would be the way to go if you desire being surrounded by other Jews. Wilmette is far more Protestant and Roman Catholic. Wilmette also is home to many of the Beha'i faith and there is a large Mormon congregation (I'm LDS I live in Winnetka, but most of our members live in Wilmette).

Glencoe is considerably more expensive than Wilmette, especially in regards to entry-level homes. Glencoe is a much smaller town with less amenities, but greater access to what is available.

If I were Jewish I wouldn't be uncomfortable living anywhere on the North Shore, but I would add that while there are many Jewish families here, and many longtime senior citizen residents, I can't think of any Jewish families in the last few years moving into the area (not that I know everyone, but just in terms of new kids & parents).
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