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Realtors take of WRAL report, Mike Walden, housing market worsens in Triangle, bargain place to live, production builders, inventory homes, custom builders drop prices, interest rates
The seller will have to wait a bit more than next April to get his price. More like April 2013!
This paints a rosy picture for buyers who don't have a house to sell themselves. If they have their own house to sell then it isn't as rosy a picture unless they accept a wash for a wash. It is great for first time home buyers. Not sure what percentage of the real market is first time buyers who can actually afford a house. At any rate the market is in limbo and the key statistic may be the affordability index in any given market.Yessssssssssssssss those California areas with a 5% index are in a heap of trouble. Those with a 75% index are a different picture. During the internet bubble those companies with no profits and horrible valuations bit the dust. Those that had great valuations and just were not iin vogue became value stocks and formed the basis of a lot of money being made. I really think the housing market will bounce back sooner in some areas and not at all in others. Until someone starts liking jumbo loans for investments the higher end of the market will suffer. A rise in inflation and interest rates will have a definite impact on buyer psychology.
Unfortunately (sic) the rates are heading lower! Now they are talking of a 50 basis point cut instead of 25 points. Tho I doubt it if the consumer will feel the full benefit of it in reduced mortgage rates.
It's more to bail out the banks so that they can recover the losses they have suffered in the mortgage mess. The point spread between borrowing and savings is going to get greater. Eventually, its the poor customer that ends up picking the tab, whether its govt bail out or plain market economics.
Quote:
Originally Posted by TuborgP
This paints a rosy picture for buyers who don't have a house to sell themselves. If they have their own house to sell then it isn't as rosy a picture unless they accept a wash for a wash.
Why not? Most buyers buy a new house to upgrade to a more expensive house. So if the above scenario acts out, they could get the newer more expensive house for much less money than what they would lose on their lower price house, so the difference to upgrade would be lower. This holds even more true in a declining market as pricier properties tend to drop more percentage wise than cheaper ,more affordable ones. So the delta and benefits are greater.
The production builders ARE lowering their prices, on inventory homes. This is somewhat normal for this time of year. When you see the big names like KB and Beazer and Pulte saying they are dropping prices $30,000 and $40,000, I'm concerned that they have inflated these prices before dropping them so make sure you have your Realtor check those comps. I believe that these production builders overbuilt in this area expecting more people from Florida, Calif. and up north. Now, they have a huge amount of inventory homes that they need to get off their books before the end of the year.
As the article says, housing prices have not dropped. I'm not seeing too many of the custom builders dropping their prices at all.
Showings ARE down. I can tell that just from my listings. It IS taking longer to sell because we have less buyers. Again, somewhat typical for this time of year. Again, those folks that were moving in so quickly in spring and summer wanted to be here for the beginning of the school year. Less buyers this time of year. Will this cause some sellers to lower their prices? Yes. Supply pushes prices down. Demand pushes prices up. Basic economics.
What would I do if I were a buyer today? I'd be very careful as to WHERE I'd buy. In this type of market, its all about LOCATION LOCATION LOCATION. I'd be careful buying in a new neighborhood without researching to see what has sold and for what price. North Raleigh and Cary are still the most expensive areas but appreciation is always good in these areas. Again, supply and demand.
I sold homes in the early '90s when our housing market was slow. Interest rates were around 12% to 14% and yes, people still bought houses. They just bought less house due to the rate being higher. Our rate is still very low. First time homebuyer's rate was at 5.75% last week. Current interest rates are around 6.25%. People will buy. Just make educated decisions.
I don't put much stock into any of these articles as each one says something different each day whether good or bad. I go by what I actually see. I put my house on the market.......no selling agent, priced above comps and 17% above purchase price from two years prior. Contract down in 27 days (in September), only used Craig's list and closed last night in about 10 minutes. We bought our home that is being built for 22% less than the per sq ft comps in the area and have some really nice upgrades going in, we got to choose everything ourselves and my wife is happy and that makes me happy. All of this is being done in the triangle and in the past 30 days so very recently. The only thing falling out of the sky today is rain. It's a good market if you are smart on both ends. Do your research.
Unfortunately (sic) the rates are heading lower! Now they are talking of a 50 basis point cut instead of 25 points. Tho I doubt it if the consumer will feel the full benefit of it in reduced mortgage rates.
It's more to bail out the banks so that they can recover the losses they have suffered in the mortgage mess. The point spread between borrowing and savings is going to get greater. Eventually, its the poor customer that ends up picking the tab, whether its govt bail out or plain market economics.
Why not? Most buyers buy a new house to upgrade to a more expensive house. So if the above scenario acts out, they could get the newer more expensive house for much less money than what they would lose on their lower price house, so the difference to upgrade would be lower. This holds even more true in a declining market as pricier properties tend to drop more percentage wise than cheaper ,more affordable ones. So the delta and benefits are greater.
Yes you are right thats what I mean by a wash for a wash. Sell low buy low. However I know folks who still want to sell high and buy low. Also I have to believe that at some point builders will cut back on their building and existing inventory will drop. I can't believe they will keep building if they have to give deep discounts. They will start to build at lower price points etc. The deals won't be there if there isn't excess supply. You can wait or you can be saavy and find the current bargains and the right buyer for your house. Obviously from the numbers a lot still are. From what I see and I may be wrong most new home builders are discounting options and people with exisiting homes are discounting the actual home. It will all play out and congrats to those who are selling and buying.
The only thing falling out of the sky today is rain. It's a good market if you are smart on both ends. Do your research.
+1000
In a sell/buy, the key is balancing both ends. There's a very clear pattern in many larger triangle neighborhoods today-if you want to sell, price it to sell. If you don't price it right, it gets stale.
A neighbor of mine is an agent with a handful of listings in the neighborhood. Two in particular have been on the market for 150 days without an offer. They have not reduced their prices, and have turned away showings if they don't like when they are scheduled. As far as I'm concerned those houses are not for sale. There is one other listing brokered by the seller's mother-they are at 180+ days again without an offer. After lowering 20K they are still probably 30K too high.
Wow, N_R_G hasn't posted on this one yet. Has he kicked the RE habit for good????
Once a junkie always a junkie. He is probably out taking some great pictures of neighborhoods in the rain. I find all of this hilarious. I came out of the shower today and my wife told me that the lady on the tv said the problem was that sellers still had unrealistic prices. That they had to get real and lower the price. I said " dear maybe they were like us and were only going to do what we wanted". Most sellers don't have to sell and are doing so because they saw big $$$$$$$$$$ signs. With out the big $$$$$$$ they don't want to sell. Realtors need people to buy and sell and economists would love it. Most people don't care and are neither. Once I get down there and settle I will probably fade into threads about cooking and pictures of neighborhoods and lawns and yuk insects. I will leave housing to junior who has an opinion about everything and is addicted to being right. Not sure where he got that from. I am sure NRG is lurking and holding his right hand with his left hand so he can't do anything.
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For some buyers
