2010 -Where do we go from here?
I recently read an article by Pat Mertz Esswein on Kiplinger’s on “What’s ahead for home prices?” ( January 18, 2010).
The article is very important for sellers to understand. The article talks about; that the housing market did catch its breath after struggling to recover from the most severe downturn in the housing market since the Great Depression. The first time home buyers tax credit and low mortgage rates lured buyers to make their move. But the article continues to state that the correction is not over yet. Credit is still tight, unemployment is high and more foreclosures are coming. Even with the credit extension and expansion and an upward trend in sales home prices will continue to edge lower though next spring. The U.S. housing market will not begin to look healthy until at least 2011.
From the beginning of the downturn in mid-2006 to June 30, 2009 the median price of an existing home nationwide fell 30% or 11% annualized. Between first and second quarter of 2009 there was a slight rise by 1.4%, the first such increas since 2006. Given that prices tend to stabilize about a year after sales begin to recover. Accordingly Fiserv (Lending Solutions) expects prices to bottom out in mid 2010. Its forecast is that the median home price will have fallen by 7.5% in 2009 and will drop an additional 9.2% to a level not seen since 2001.
With all this information the summary is simple. It is a great time to be a home buyer and seller who wants to sell must come in to reality about pricing thier home. The competition is fierce, there is a lot of inventory out there and as a seller you need to be the best home on the market. Price, Condition, Location, and Accessibility sells the home
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A follow up on 2010 – Where do we go from here?
Opps, we lost a listing to another agent or did we?
Recently both Angelina and I went on a listing presentation. Fully prepared with our statistics, Cost Market Anylasis and more we showed up to our appointment. Before we could even start our presentation another agent showed up. We were not sure what was going on. The seller said that she got the days wrong and did not realize that she had double booked appointments. We took a quick tour of the home and kindly said we would come back. In the mean time the seller went on to tell us what the house was worth and that they knew everything about the market. Without being able to do our presentation we challenged a few ideas hoping the seller would use this information to make a good decision. We said we would come back and set the date to do so. The next day we recieved a call that they had decided to list with the agent that had stayed for the appointment. I asked why and then the question of course how much did you list the house for? WOW! we thought, knowing the house across the street was on the market for some 2 and a half years before it sold and more than $169,000 less than the original asking price. That house was much bigger and had more to offer. I knew the house well. Those sellers did not take my advise back then and were also chasing the market. What were we thinking by letting this get awya from us? More so what was the other agent thinking? This presents the problem of “buying listings”(we are not saying this is what was done, but our statistices tell us it sure looks that way). An agent asks what do you want to sell the house for? Okay I can list your home for that much. Are agents doing the right thing? The most powerful thing both Angelina and I can do is walk away from what we call a “non listing”. How is this house going to appraise? What will happen if someone makes a offer and the appraisal come in low. Hows does it look for the agent on both sides? Priced to high by the listing agent and did the buyer’s agent do their job on providing the buyers with information on what homes have sold for in the area? Will it even get showings, when it is over priced for the area? What does this do to the listing? Sitting out there months at a time, time that is lost when a seller wants to sell. Agents need to be able to stand up to a seller and bring them in to reality right from the start. This will m ake our jobs easier and help the market by not putting over priced listing out there and thus sellers will realize that prices have come down and if they are to really sell their home in a down market what they want and what they can get out fo thier home is two different things.