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Old 11-04-2016, 04:18 PM
 
777 posts, read 1,205,334 times
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Quote:
Originally Posted by jennifw View Post
I think the market is very different now than 2 years ago. We just sold our home and would not have entertained a contingency offer
I disagree. I follow the market in our subdivision and know of 2 homes purchased recently (this year) via a contingency offer. It's a matter of having a competent realtor and the price point you're in. Not every house is equally desirable or attainable for a large pool of buyers, so sometimes contingencies are viable options to enable a sale. This is particularly likely finding something off-market and negotiating based on the sale of your existing house.

I will agree in the hottest areas and price points that it's less likely. However, if someone selling a 700K house that has a limited buying pool needs the 200K in equity from their current house, it makes sense to still do a contingency to allow the client to liquidate their current house, do a short lease-back, then close on the new house with the proceeds.

I don't see the above happening in a sub 400K price point or in highly competitive areas such as West Plano, Frisco, etc, but it can happen.
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Old 11-06-2016, 11:28 AM
 
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Just figured I'd update this... A friend of mine has been "informally" house hunting for the past few months. The plan was to put their home on the market in April/May, but they just found a home they really like for sale in McKinney.

Anyway, they spoke with the realtor and told them they would need to sell their house first, and the owner was open to a contingent offer.

It's too soon to say if it will actually happen, they are in the process of getting their house listed now before making an offer. But, considering November/December are not the hottest months for real estate, this other homeowner was at least willing to entertain a contingent offer.
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Old 11-06-2016, 02:26 PM
 
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I think it all depends on how much demand there is in the area you are trying to purchase in, what the price is, how many days on market, etc.
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Old 11-06-2016, 07:16 PM
 
Location: plano
7,885 posts, read 11,324,051 times
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Seems to me, being open to more potential buyers, those with homes to sale before they can close, should directly yield a better sales price on a home. If timing is critical, I can see saying no to contingency offers but otherwise I would be open to do so for the right price. Assuming the right price is going to appraise to close too. I bought my Plano home before even putting my Houston home on the market but I had time to handle things this way. It allowed me to get a top price for my Houston home and get the riht home for my family in Plano.

I understand there are many cases where timing is as critical as price. But the few cases where timing is not driving the deal. Id be open to a contingency contract if the circumstances were correct to make me confident the buyers home was going to sale and they would close.
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Old 11-06-2016, 11:23 PM
 
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Unless I'm not getting ANY offers, I would rather go with the buyer with ability to quickly close the deal without any uncertainty in the mix, even if his offer is lower than contingency buyers. However, more adventurous yet patient sellers can make a little more with being open to highest bidder, if they don't mind the hassle.
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Old 11-07-2016, 12:36 PM
 
113 posts, read 154,058 times
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The Dallas real estate market is in flux right now. If you look at the data in Dallas proper, >$1M+ homes is a buyer's market. The $2M+ market has years worth of inventory available and is in an outright bear market for sellers. The sub $500K market is still relatively strong.

Can't say what will happen, but the recent price appreciation the DFW area has seen is not sustainable. However, absent a major recession or huge spike in interest rates, I don't see prices dropping or a "bubble bursting", either. I anticipate price appreciation will flatten near term and maybe even tick downward a bit as interest rates rise in the coming years. Either way, I don't expect a major price drop. These prices are likely a "new normal".

Regarding contingent offers, I think it hurts buyers negotiating power and many sellers will not consider it. As a seller, I would probably not even consider a contingent offer unless it was at or above ask price and I had no other offers.
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Old 11-07-2016, 12:44 PM
 
19,493 posts, read 17,729,533 times
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Quote:
Originally Posted by lakeside15 View Post
The Dallas real estate market is in flux right now. If you look at the data in Dallas proper, >$1M+ homes is a buyer's market. The $2M+ market has years worth of inventory available and is in an outright bear market for sellers. The sub $500K market is still relatively strong.

Can't say what will happen, but the recent price appreciation the DFW area has seen is not sustainable. However, absent a major recession or huge spike in interest rates, I don't see prices dropping or a "bubble bursting", either. I anticipate price appreciation will flatten near term and maybe even tick downward a bit as interest rates rise in the coming years. Either way, I don't expect a major price drop. These prices are likely a "new normal".

Regarding contingent offers, I think it hurts buyers negotiating power and many sellers will not consider it. As a seller, I would probably not even consider a contingent offer unless it was at or above ask price and I had no other offers.
What's your source for the two claims in you first sentence? I have good visibility into an area with lots of $1-3MM dollar homes and the ones for sale are selling.
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Old 11-07-2016, 04:58 PM
 
13,194 posts, read 28,107,679 times
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Quote:
Originally Posted by lakeside15 View Post
The Dallas real estate market is in flux right now. If you look at the data in Dallas proper, >$1M+ homes is a buyer's market. The $2M+ market has years worth of inventory available and is in an outright bear market for sellers. The sub $500K market is still relatively strong.

Can't say what will happen, but the recent price appreciation the DFW area has seen is not sustainable. However, absent a major recession or huge spike in interest rates, I don't see prices dropping or a "bubble bursting", either. I anticipate price appreciation will flatten near term and maybe even tick downward a bit as interest rates rise in the coming years. Either way, I don't expect a major price drop. These prices are likely a "new normal".

Regarding contingent offers, I think it hurts buyers negotiating power and many sellers will not consider it. As a seller, I would probably not even consider a contingent offer unless it was at or above ask price and I had no other offers.
Quote:
Originally Posted by EDS_ View Post
What's your source for the two claims in you first sentence? I have good visibility into an area with lots of $1-3MM dollar homes and the ones for sale are selling.
There is data to support those claims, but it really just depends on the house. My neighborhood has two gorgeous spec homes in the $1.5-1.8M range that went under contract immediately but they are *exactly* what the average buyer is looking for in this market - the right floorplan, countertops, lighting, wood floor stain, knockout baths & closets, etc. Then, there is a $1.7M spec home that missed the mark and has been for sale for about 15 months now. Remodeled ranches and lots/teardowns ($500-900k range) still selling briskly, i.e. <60 days.

Million dollar homes are selling but they have to be PERFECT to go quickly.

I am hearing the $2M-2.5M+ market in HPISD is soft right now. We'll see what happens with the election tomorrow as I think fear and uncertainty is driving the slowdown in that market more than affordability.

FWIW, I know three different couples all looking in Lakewood now for a home in the $1-1.2M range. All have been looking for about six months and haven't found anything to be "just right". It's the inventory that's causing them not to purchase, not the price, as these are people who don't want to remodel.
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Old 11-07-2016, 07:27 PM
 
19,493 posts, read 17,729,533 times
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Quote:
Originally Posted by TurtleCreek80 View Post
There is data to support those claims, but it really just depends on the house. My neighborhood has two gorgeous spec homes in the $1.5-1.8M range that went under contract immediately but they are *exactly* what the average buyer is looking for in this market - the right floorplan, countertops, lighting, wood floor stain, knockout baths & closets, etc. Then, there is a $1.7M spec home that missed the mark and has been for sale for about 15 months now. Remodeled ranches and lots/teardowns ($500-900k range) still selling briskly, i.e. <60 days.

Million dollar homes are selling but they have to be PERFECT to go quickly.

I am hearing the $2M-2.5M+ market in HPISD is soft right now. We'll see what happens with the election tomorrow as I think fear and uncertainty is driving the slowdown in that market more than affordability.

FWIW, I know three different couples all looking in Lakewood now for a home in the $1-1.2M range. All have been looking for about six months and haven't found anything to be "just right". It's the inventory that's causing them not to purchase, not the price, as these are people who don't want to remodel.
There's a big difference between your points and lakeside15's claim that we have "years" worth of $2+MM inventory and a that there is a bear market in that segment........."bear market" generally meaning that within a particular market prices have fallen 20%+ and widespread pessimism exists.
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Old 11-08-2016, 11:44 AM
 
113 posts, read 154,058 times
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I'm actively searching and my realtor showed me the MLS data for Park Cities/Preston Hollow areas. Also spoke with numerous longtime Park Cities realtors who confirmed the same. The >$2M market for Park Cities has 3+ years worth of inventory at current pace of sales according to the realtors I've spoken with. I'm not looking in that range and don't follow that level, so can't say for sure what's going on with prices or any reductions. If true, I would call a 3+ year inventory a "bear market", even if prices are not yet coming down.

From personal observation, the Park Cities market is soft with most homes lingering on the market and quite a few price reductions. This started in May or so and activity picked up in September-October and now back down again. Lots of new inventory is appearing as well (though still relatively low at the lower price point I'm searching). The only homes that I've seen sell quickly recently (less than 30 days), have been fully renovated and/or "prime" properties. According to the MLS statistics my realtor provided, the sales price to list price is averaging around 4-5% for houses that do not go under contract quickly, which I would also call soft. Pocket listings in the "entry level" for Park Cities are nearly non-existent now as well, which may indicate further weakness.

Houses are selling, for sure, just not a the pace and percent asking price that we've seen in recent years. It could be seasonality or a temporary lull, or perhaps signs of something greater going on with the market. Time will tell...
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