"No Takers"
Columnist Bob Shallit writes about Sacramento's declining housing market:
Motivated seller: Speaking of a slowing housing market, developer Mike Klein is fretting about low demand -- so far -- for a project we previously dubbed the first "subdivision" built in east Sac in decades. The project has just four units -- attached, two-story town homes at 52nd and J streets. But that's quite a few for a part of town that hasn't seen a new multiple-housing project in decades. The homes were completed a month ago. They have sort of a combo Craftsman-and-row-house feel.
Klein planned to market them for $525,000. "And they probably would have sold immediately if I had built them last year," he says. But times have changed. He started them at $499,000. No takers.
The price has come down to $474,900 and now $449,900. What's his next move? He may offer buyers some incentives. Like a free plasma TV. Or, he says, he may just rent the places..."until the next good market."
12 comments:
Change "developer" to private seller and you have an atypical story of what the selling experience is all about right now.
I know of a very nice 2,800sqft house in Roseville on a corner lot in a very nice neighborhood that started at 525, then 500, then 475, now at 450. Zillow thinks this place is worth 539.
Still "No Takers"
If this guy can afford to rent them out without taking a huge loss he can obviously afford to sell them for a fair price. But instead he'll wait until the next gold rush where people can't wait to live in condos for a half million dollars.
Rising cost in fuel, rising interest rates, coupled with hugely inflated housing prices = no SALE for the flippers.
Let's not forget when the interest only ARMS reset.
It going to be quite interesting to see how all this turns out.
That sounds like a huge drop in value to me. And the real estate folks say "oh it will be a soft landing".
Try telling it to that seller.
He just took a hard landing on his butt!
I am probably the " typical " person the home sellers would love to have buy a house: married w. 3 kids all under 5yrs of age .. BUT I refuse to play this rigged game.
I've been crammed in a 2brd apt for almost 4 years now watching this rediculous run-up in prices.
I finally decided this year(2006) would be the year to just buy a vacant lot in a decent part of town then build a house on it saving money AND keeping quality.
If I have to spend over $200K for a house it better a good one!!
(wouldnt you know it my father in law dies in Jan so we inherit his mortgage free home but needs major renovation) / catch you later
karl,wait a few months before you renovate,there will soon be a lot of hungry contrctors available,and the price of materials will come down as well.just be sure you check out your contractor carefully.
Karl
Go to the contractors license bureau as part of the background check.
cslb.ca.gov
Man that guy took a 15 % price drop and still no suckers, I mean buyers?
anonymous,
I am still cracking up that Zillow has it at 539 and they are asking 449.
Shouldn't sucke... err... buyers be all over it? I mean isn't that like 90k for free?
Down down down and the flames went higher.....
Quote below from Zillow web site:
"Fast forward 15 years. Both Rich and Lloyd were separately involved in buying houses"
It makes one wonder who Zillow actually represents.
Here is greed for you. A friend of mine is looking for a home and bids 340k for a home listed at 360k, back in Dec. Seller apparently is offended and comes back with full ask. In Feb home is removed from MLS. In Mar home back on for 360k. By May, no offers and price gets reduced to 350k. In July house is still on market. Now back in Dec the fool could have sold the home for 340k (320k after realtor fees), Placed the money in 5% (or better) CD's and obtained an appreciating asset instead of a depreciating one. (a fool and his money soon part) Sellers are going to look back on 2006 and kick themselves for not reducing their prices when they could have. Apparently they are not watching the flashing red danger light called inventory build-up. A lot of them will ride their gains down to 2002 - 2003 levels.
Sellers refuse to learn from the housing crash of the early 1990s, when following the prices down just delayed getting the house sold. But wait -- there WAS no housing crash circa 1990, right? Housing prices in California never go down.
People who made a 20% down payment in 2005 are going to be truly screwed, as price declines will kill their entire equity. Heck of a way to lose your life savings.
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