[GuruChicken]

Trying to sell my house and wow, the housing market seems shut down. One showing in a month, not interested though. At the end of May houses in my area were going under contract in a day or two. Now...nothing at all.

I get that the Feds raised rates twice. It's as if it scared everyone away. What about the cash buyers though? I don't mind reducing but my realtor said even those reducing quite a bit aren't getting any interest either. He said it's a scary market right now.

Anyone else going through this or a realtor with any info?

[cunningja]

It's a combination of interest rates going up, everyone worried about inflation and whether we're in a recession, or headed that way soon, uncertainty scares everyone including the cash buyers.

Several are forecasting a 15-20% reduction in housing prices, so why would someone want to buy now and take that risk?

Neighbor across the street sounds about the same, been on the market for a month with very few interested buyers, and he's just reduced for the 2nd time.

Best of luck

[Mike from back east]

Reminds me of 2005. In May we sold our house in the DC area, in just a few days, with 4 offers.

In August 2005 our realtor back in the DC area said the market slammed shut, dead stop. The rest is history.

I've been tracking homes in Beaumont, CA, lately. Got an email from www.Realtor.com that six had price decreases in one day.

Edit to add on 02 Aug: Got another email today with 3 more price reductions.

Edit to add on 03 Aug: Got another email today with 5 more price reductions.

Edit to add on 15 Aug: Got another email today with 20 more price reductions.

[WestieJeff]

Cash buyers aren't stupid, they aren't going to pay inflated prices when they know an entire swath of the market (those needing a loan) can no longer afford current market prices. They know prices are coming down couple that with the general feeling of unease related to the economy now.

Prices are dropping and likely to continue to drop, the only question is how far. I suspect it will take 6-12 months for many sellers to accept the fact they missed the boat and adjust pricing to current realities.

If I was selling I see the options as 1) a steep reduction to get the home under contract and get ahead further market deterioration 2) wait it out, see if the mortgage rate situation improves but that's probably a year minimum of waiting I'd guess (that assumes the economy doesn't dump in the meantime) 3) hope and pray for a dumb cash buyer.

[Koshka2]

Originally Posted by GuruChicken

Trying to sell my house and wow, the housing market seems shut down. One showing in a month, not interested though. At the end of May houses in my area were going under contract in a day or two. Now...nothing at all.

I get that the Feds raised rates twice. It's as if it scared everyone away. What about the cash buyers though? I don't mind reducing but my realtor said even those reducing quite a bit aren't getting any interest either. He said it's a scary market right now.

Anyone else going through this or a realtor with any info?

I currently have a house on the market in Texas. We are hoping to sell and buy in Las Vegas so I've been following the Las Vegas market for months.

If you have gotten 1 showing in a month then your house is significantly overpriced for the current market. Go to Redfin or some other place that lists houses on MLS. So a search for houses similar to yours in terms of size, number of bedrooms, amenities, location, etc. Then look up what houses your house is priced at look like. That is, if your houses is listed at $600k then look at what you can get for $600k.

Right now, houses in my price range are much "nicer" than they were 3 or 4 months ago. When I see someone pricing a house now at what it would have been priced at in April I tend to think they are not very realistic. Their house does not look good compared to other houses on the market now.

There are a number of factors lowering demand right now. Higher interest rates is one reason but isn't the only one. When buyers tend to think prices are going down they become more hesitant to buy. Also, there are seasonal factors. People with kids want to buy before school starts. We are past that window now. So buyers will tend to be those who either don't have kids or who have to buy now (such as a job transfer). A lot of buyers the past couple of years were "optional" buyers such as people who could now work remotely and live anywhere. Now those people may be more cautious. Also, if your buying is optional and you need to sell your house you may be more cautious if you aren't sure how long it will take to sell your house and you aren't sure what you can sell it for.

The markets cooling down the most rapidly are the markets that have been most overvalued. Las Vegas is considered one of the most overvalued markets in the US. The only reason we were (and are) willing to wade into it is because we are in a good market (although not as overvalued as Las Vegas) and we are downsizing so going from a more expensive house to less expensive house. FWIW, it is clear to me that things are slowing down in my market and price reductions are more common, however, that trend is much greater in Las Vegas than where I live. So, for me personally, it doesn't really matter if it takes awhile to sell my house because I think that houses in Las Vegas will go down more and there will be more choices available whenever we buy even if that ends up being next year.

Also, inventory is rising a bit. It is still low compared to a normal pre-Covid market but it is increasing. And, it is increasing more in Las Vegas than elsewhere.

As far as what your realtor said about houses not selling with even price reductions, I think things have slowed down. But, most of the houses I've been following that do have contracts on them either had a price reduction or they are recently on the market and priced lower than they would have been 4 months ago.

I think sometimes people have forgotten what a normal balanced market is. I've sold a number of houses in my lifetime. I've sold a house before it even got on MLS and I've sold on the first day of listing. I had a house (in 2010) that took a year to sell. I've had houses with multiple offers. I sold a house that had steady showings (averaged about 2 a week) but still took 3 months to sell. And that latter house is far more typical than the house that goes on the market and immediately gets multiple offers.

When demand is lower, even for correctly priced houses, it can take much longer to sell a house. But, if you aren't getting showing at all then your pricing is not in the ballpark. Now, I can understand if you don't want to reduce the price and possibly have your house sit on the market getting showing but no offers. Sometimes when people are in that situation they will take the house off the market in the fall/winter and then put it back on in the spring when there is more demand for people wanting to close in early summer.

[FML157]

Buyers with financing (that NEED to buy), are opting to get the best bang for their buck right now. So they're looking at houses that are in good condition with modern upgrades/finishes/trim/paint etc... and/or are priced below market value. Cash buyers seem to be holding off a bit. Some finance buyers are holding off because with current rates their monthly payments won't afford them a nice home.

[North Beach Person]

Might water issues play a part?

[GuruChicken]

Thanks for your thoughts everyone. Good info to think about. I do like the idea of doing a deep reduction. No sense in keeping the price on the higher end if I'm just going to sit on it for a year. I agree prices need to come down. That's why when I sell this house move to a different state, I think I'll rent until things stabilize.

[atler8]

Originally Posted by North Beach Person

Might water issues play a part?

I've long wondered the same thing in terms of the real estate market in Las Vegas and some other cites/states where growth and even life as we've known it, seems to be somewhat unsustainable in the fast-approaching future.
Personally, I would never consider moving to or buying property in a location that relies heavily or entirely on an increasingly tenuous supply of water.

[Igor Blevin]

What happened to housing?

We are flipping from a sellers market to a buyers market. FOMO for buyers is becoming FOMO for sellers.


Affordability got slammed.

Prices and mortgage rates leaped up as fast as any time in history. 18 million Americans who could afford the median priced home in 2020, now cannot. That is 18 million Americans who dropped out of the housing search or fell to a lower grade of housing. They aren't building low end homes, so many who can't afford the median really can't afford a home, unless they want to live in a slum somewhere.


There are less buyers.

A lot of buyers are seeing a change from sellers market to buyers market and are willing to wait for a deal. All of the desperate people who feared missing out on a home purchase, they have already bought homes. The remaining buyers are more patient and are not going to pay $50,000 over asking or opt for no home inspections, and such things. So the picky buyers are what is left and they are not going to just buy something to buy something. Not at these new interest rates.

We are transitioning into a buyer's market. As that happens, more buyers on the sidelines will come to believe that if they wait, they will get a "deal" on a home from a forced seller or just someone who is impatient to sell their home, or someone worried that if they don't get $500,000 for their home today, it will only be worth $400,000 2 years from now. Some sellers may worry it is 2008 again and will sell a bit short to avoid a big loss later on. I don't think it is 2008 again -- not with these low inventories -- but some sellers may think that. Some buyers may be sitting and waiting for those sellers to mark down asking prices.


There are more sellers.

We just transitioned from FOMO for buyers to FOMO for sellers. Now that rates are high and the market has cooled down considerably, many people who were waiting for a market top have fear of missing out on selling their home and are now listing them, because they worry prices might go down and they want to get the best price before that happens. I don't think prices are going down, but some sellers may think that. Lots of new sellers are testing the water so buyers are being more picky with all the new listings.