Market Improvement but Price Still Falling? (2013, appraiser, sales, accept)
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I read an article just today about this and was somewhat perplexed. If the market is improving I summized from the article that it means that there were more home sales, however the prices of homes have not gone up but actually decreased.
I was only curious because I did a search for the areas we are looking in and a lot of the homes have had price reductions just this week of anywhere from $5-20,000. Ones that we saw when they were listed at $389 are now down to $379.
Is it a function of the market, stale sales, or because Spring is coming and they don't want to worry about more choices coming on the market? What's everyone's take on the differential.
I read an article just today about this and was somewhat perplexed. If the market is improving I summized from the article that it means that there were more home sales, however the prices of homes have not gone up but actually decreased.
I was only curious because I did a search for the areas we are looking in and a lot of the homes have had price reductions just this week of anywhere from $5-20,000. Ones that we saw when they were listed at $389 are now down to $379.
Is it a function of the market, stale sales, or because Spring is coming and they don't want to worry about more choices coming on the market? What's everyone's take on the differential.
Prices do not fall when original prices are reflective of current market value.
Prices do not fall when original prices are reflective of current market value.
Maybe it's Friday and I'm just tired from playing bidding games on this current offer I'm in. But could you decipher? The market value of homes has gone down so the lowering of home prices is just reflective of that? Maybe because I'm not looking at market values and looking solely at the cost of the home compared to what it was listed at.
Maybe it's Friday and I'm just tired from playing bidding games on this current offer I'm in. But could you decipher? The market value of homes has gone down so the lowering of home prices is just reflective of that? Maybe because I'm not looking at market values and looking solely at the cost of the home compared to what it was listed at.
He's saying maybe they were overpriced to start. So their price reduction may be indicative of that, not the actual market value decreasing.
A property is listed at a price well over current value. Other fairly-priced listings sell at increasing prices but this and other over-priced listings are left. Even as the prices of sold listings move up, the over-priced properties must drop their prices to get into the zone.
EXAMPLE
Current market value on Nov. 1, 2012 - $250,000
Unrealistic seller lists on Nov. 1, 2012 for $300,000
Nov 2 Neighbor #1 lists his for $260,000 and sells for $250,000
Jan. 1, 2013 Neighbor #2 lists for $270,000 and sells for $260,000
Jan 30 Unrealistic seller drops price to $290,000
Feb 15 Neighbor #3 lists for $270,000 and sells for $265,000
March 1 Unrealistic seller drops price to $280,000
Rinse, repeat until unrealistic becomes realistic
Overpriced listing is dropping price even as sold prices are climbing.
Come to my neighborhood in Denver and be prepared to pay over list price.
One of my neighbors put her house on the market at what I thought was a reasonable "market" price. And, given that I have a spreadsheet with 185 rows for all the houses built/sold/for sale in this century in the neighborhood, I have a good feel for prices.
She got 12 offers in 3 days.
Not all neighborhoods in the City & County of Denver are seeing this.
I am in the North Dallas market and a good house appropriately priced will sell fast. When we put our home on the market, we accepted an offer within 2 days. All we did was list on Friday and accept offers on saturday. Our home was a starter home so it is in the lower part of the market. Similiar homes priced unreasonably price are still on the market.
On the flip side when we were trying to buy our next home, it was the same situation. All the homes that are in great shape with great location were selling and we missed 1 we liked because of that.
I think with housing you have to take these reports with a grain of salt. Good homes are selling, crappy homes just sit there and languishing on the market. People that usually have pie in the sky pricing on their homes never seem to of maintained them.
Also, There was one house I put an offer on that seemed nice. Seller accepted but I backed out during option because there was a lot of deferred maintenance that the property required causing the home in my opinion, to be overpriced. I could easily find a home for the SAME price that was well maintained and move-in ready, it was a no brainer to let that one go.
I was only curious because I did a search for the areas we are looking in and a lot of the homes have had price reductions just this week of anywhere from $5-20,000. Ones that we saw when they were listed at $389 are now down to $379.
All real estate is local. Maybe the area you're looking at is behind the national trend. Take Chicago for example, some parts' prices are still falling.
In our digital RE age, some folks and/or Realtors seem to frequently change prices by a small up/down amount --IMO, this is intended to keep the property at the top of new/changed listings which are then often automatically emailed by a wide range of Realtors to their 'mailing lists.'
You can check-out actual SALE prices via your County Tax Appraiser's online website -- Although these listings are often a month behind, they will give you a more realistic idea of what is actually happening in the market.
He's saying maybe they were overpriced to start. So their price reduction may be indicative of that, not the actual market value decreasing.
Yep. That is what he was saying.
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All real estate is local.
