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It seems like a lot of buyers, specifically first timers, are really nervous and sitting on the sidelines. I would be too if I didn't have any experience in buying. I mean, who wants to buy a house and then have it be worth much less months after purchase? I think a lot of buyers are afraid of just that.
Our realtor wants us to reduce (I think she just wants to move the property), but I see no evidence that doing so will cause a bunch of buyers to come calling. We'd have to go crazy low for that to happen, and it just isn't worth it to us. What seems to be selling is stuff under 300k, and we're not in that category. If sellers chase the market down with few buyers, then we've got a major crisis on hand.
The stock market drop is potentially great for all. If it keeps going down, hopefully the Feds will cut rates, and we'll all be back in the game.
I'm no expert, but I think NJ home prices will hold steady or drop slightly in the next year. I don't think prices will ever really drop significantly; there are too many people moving here to escape super-high prices around NYC. But houses are selling slow and some people are desperate to sell. If interest rates go up, I don't think you'll necessarily get a much better deal by waiting until next summer.
Exactly what I think is true for this state. I wish others would realize this too and also start moving on.
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Originally Posted by juliann1977
It seems like a lot of buyers, specifically first timers, are really nervous and sitting on the sidelines.
Agree. They keep hearing prices are going down but not seeing it.
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Originally Posted by juliann1977
Our realtor wants us to reduce (I think she just wants to move the property), but I see no evidence that doing so will cause a bunch of buyers to come calling. We'd have to go crazy low for that to happen, and it just isn't worth it to us. What seems to be selling is stuff under 300k, and we're not in that category. If sellers chase the market down with few buyers, then we've got a major crisis on hand.
Thankfully, our agent is being realistic. She sees that nothing over $225 is selling here; we're price at $232,000, and the few showings we did have, said the house showed well, was priced great (it was $10,000 higher at the time) and was better then what is out there for the same price. Unfortunatly, one didn't care for the house layout, while another tried to figure out how to convert it to a mother / daughter...
Talk to your agent. Ask her to look at what's sold and days on the market. You may be priced where you need to be but it will take longer selling due to buyers being afraid to purchase. Sit tight at your current price for the month of August; unless dropping maybe $5,000 brings you into a new search catagory.
The sheer lack of understanding of simple economics is on this thread is laughable. Higher supply + lower demand = lower prices.
House prices are always sticky, that's why you don't see large prices drops over a short period of time. Just wait for a few foreclosures, or desperate sellers (new job, or divorce) to ruin your comps. Go ahead, wait it out for a few more years. You're going to lose more money in the long run with that strategy than just biting the bullet now and selling it lower than you'd like.
Whether prices come down in nominal terms, or in real terms (due to flat prices and inflation over time), home prices in real economic terms WILL come down, like it or not.
I wish people would realize we can't live our lives according to what the news is saying is "supposed" to happen.
Well, when you don't have the money to buy, what are you supposed to do? Pack it up and leave? No, you have to wait. Don't make everything sound so easy.
The sheer lack of understanding of simple economics is on this thread is laughable. Higher supply + lower demand = lower prices.
This isn't simple economics. There are far more factors at work here, and quite frankly, economists don't even agree on what is at play in this market. The only thing everyone agrees on is that no one really knows what will happen.
Every single thread you post in you say that everyone just needs to reduce and that they're stupid if they don't, without any knowledge of their pricing or their homes.
If my husband, an actual economist, is not standing up on the ledge ready to chase the market down, then I'm really not that worried.
This isn't simple economics. There are far more factors at work here, and quite frankly, economists don't even agree on what is at play in this market.
Sure, it is simple economics. Ask your husband what happens to prices when supply is high and demand is low. This is not rocket science.
Do you realize that even market bulls are now saying that the bottom of the real estate market won't be until sometime in 2008?
On the buy side, there are fewer buyers now than ever before as home ownership is at an all-time high. Less demand. On top of that, the recent sub-prime fallout means lower liquidity and tighter lending standards. No more $600k mortgages for people only making $80k. Even more downwards pressure on demand. Go ahead, ask your husband what happens when demand is lower. If he's a halfway decent economist, he'll corroborate these statements.
On the sell side, prices will be sticky because people have an emotional attachment to their own home: "My home is better and worth more than comparable homes just because it is." or "I'm not selling my home for less than my neighbor got 2 years ago." However, the problem with this is that foreclosures are up. ARM resets are happening; short sales are happening. Prices will be set by desperate sellers who need to move because of a job or divorce or foreclosure. This means YOUR COMPS GO DOWN. Ask your husband the economist what happens YOUR home value when comps go down.
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Every single thread you post in you say that everyone just needs to reduce and that they're stupid if they don't, without any knowledge of their pricing or their homes.
All I know is that I here sellers complaining that no one looking at their homes at all. And then I hear sellers say, "My neighbor got such and such..." and "My home is great." Well, guess what, when no one is even interested enough to even stop by to look at your house, YOUR HOUSE IS OVERPRICED.
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If my husband, an actual economist, is not standing up on the ledge ready to chase the market down, then I'm really not that worried.
What you ARE doing is chasing the market down. By the time you realize the market is down further, you'll lower your price again. And again it won't be enough because the market has gone down further. Rinse, wash, repeat.
If you don't need to sell your house, then why bother trying to sell in this market at all? Wait it out for a few years and sell when the market is back up.
If you need to sell, drop your price and it will sell.
If you have the means to purchase a home right now, I would say go for it. I do not see the market going much lower than it already is. The mortgage rates are still REALLY low compared to years ago and the amount of home on the market are at a all time high. It is a buyers market right now and as a result, you have your choosing from hundred and hundreds of homes. If they reject your offer, move onto a another home. It is possible now!!
On the sell side, prices will be sticky because people have an emotional attachment to their own home: "My home is better and worth more than comparable homes just because it is." or "I'm not selling my home for less than my neighbor got 2 years ago." However, the problem with this is that foreclosures are up. ARM resets are happening; short sales are happening. Prices will be set by desperate sellers who need to move because of a job or divorce or foreclosure. This means YOUR COMPS GO DOWN. Ask your husband the economist what happens YOUR home value when comps go down.
All of that is speculation of what might occur. I don't hear people on this forum saying things like that. Sure, I'm sure there are people saying those things, but anybody in this market right now having any thoughts like that needs a reality check. You'd have to be deaf, dumb, and blind to think you can get what people got in 2005.
Simply saying, "oh, if you're not selling, you need to drop your price" doesn't take into account the myriad of factors that affect an individual market. Yes, if someone is desperate, than he/she should drop, but that doesn't guarantee a house will sell. Nothing does. Say someone thinks his house is worth 600k and drops to 400k. Maybe the house will sell, maybe it won't. There is no economic sense in dropping 1/3 if your house wasn't overpriced to begin with.
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What you ARE doing is chasing the market down. By the time you realize the market is down further, you'll lower your price again. And again it won't be enough because the market has gone down further. Rinse, wash, repeat.
Well, when you don't have the money to buy, what are you supposed to do? Pack it up and leave? No, you have to wait. Don't make everything sound so easy.
What I'm saying is the buyers should start going back out to look. I've stopped due to wondering if the market will drop but it hasn't.
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Originally Posted by Onizuka
On the buy side, there are fewer buyers now than ever before as home ownership is at an all-time high.
I don't feel they have an accurate number because of what I posted above. How does anyone know what demand there is if people aren't actively going out to look at what they have saved in their house favorites
"WASHINGTON (Reuters) - The pace of existing home sales in the United States fell in June to a lower-than-expected 5.75 million unit annual rate while prices and inventories showed signs of stabilizing, the National Association of Realtors said in a report Wednesday.
Sales were off 3.8 percent in June and hit their lowest level since November 2002 when it was 5.73 million unit pace.
Economists polled by Reuters were expecting home resales to fall to a 5.88 million-unit pace from the 5.99 million-unit rate initially reported for May. Sales were revised in May to 5.98 million units.
The inventory of homes for sale fell 4.2 percent to 4.196 million units at the end of June, which represents an 8.8 months' supply.
The median home price in June was $230,100 which represents a 0.3 percent increase from their year-ago levels and is the first such increase in 11 months."
Does it mean the price is starting to move up? or just propaganda?
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