“…I am really curious what you and your colleagues are saying about the current market conditions. Are you still saying that things are stable? Are things down? Looking at the first ½ of 07 vs. 08, one might say things are down, however it is in my opinion a little too early to say. Just curious what your take might be. I have read a number of articles from your website/newsletter and so forth. It is great information. I am just fishing for some educated opinion…”
Definitely sales are down first 1/2 08 (by 25%) or so - and listing inventory is up by 7% or so. With that said, that’s all encompassing - in other words, it’s everything in the MLS, not just Kootenai County.
What we are seeing is more instability (prices are all over the place) than ever before and this is usually indicative of a bottoming out - how long this instability lasts is the unknown. It’s pretty much all dependent upon the credit markets and what that is going to settle down into being in the future.
The other factor we had this year was our incredible winter - this definitely affected sales significantly in fact - but knowing just how much that alone affected sales is impossible to determine.
We are seeing several things -
1. If sellers want to sell, they absolutely must price their home at the bottom rung of the price point with little to no competition. If they don’t, they simply get lost in the sea of homes available and won’t get their home sold this season.
2. Buyers seem to think that they can make offers 10-20% below listing price on ‘best priced’ homes. By this I mean that if a home is at the best price for it’s competition, buyers think that the seller is desperate or needs to sell (or whatever they are thinking) and they offer ridiculously low offers. With sellers that are priced well, I can confidently advise how to counter back and whether to hold out or not.
3. Buyers are not separating our market from the markets that are seriously hit such as California, Phoenix, Las Vegas and Florida. Buyers seem to think that since people are making offers at up to 40-60% off listing price and getting great deals, that must be the case everywhere. Even REO’s aren’t going for more than 10% below market value in our area.
4. On the flip side, because so many of my sellers are from other parts of the country - I’m seeing more realistic expectations from sellers I work with that live out of state than I do from sellers that live locally. The sellers from out of state are innundated with their local markets downward spiral and actually listen when I explain our market here.
5. On the other side of the above, I have a couple of sellers that are unrealistically freaked out - one seller brought over $30,000 to the table to close his property only because he was nervous about the market (out of state seller). That $30,000 would have sustained him with a tenant for 4-6 years (it is a very strong rental market in our area) - well beyond our current market conditions. My honest opinion, if you have to bring money to the table - sit down and figure out how long that money would last should you rent it out - even at a negative cash flow. Then determine if that is long enough to get you into a better time of year to sell or even a better year to sell.
Posted under For Buyers, For Investors, For Sellers, Market Reports
