Buyers on Strike: 'We Don't Want to Lose Equity Overnight....'

From KCRA:

After trying to sell his home in Folsom for nearly a month, Mark Tortorelli said he wasn't surprised to hear about this latest market slowdown. "Last year it probably would have taken about three days. This year it might take up to three months, I guess," Tortorelli said. In fact, instead of a "sold" sign out front, Tortorelli's real estate agent recently added an offer of free housekeeping and free pool service for a year.

But while some sellers are getting creative, many are apparently deciding to simply cut and run..."We're starting to see people have to sell for less than they purchased for. This is bringing about what we call short sales where we're actually having to work out issues with the bank and in some cases turn it back to the bank again," said Tim Thompson of Keller Williams Realty.

What's driving the price slide? Experts blame rising interest rates, fewer Bay Area transplants and investors who've moved on to greener pastures.

Tortorelli said he'd like to move back to his home state of Washington, but if prices continue to drop, he may have to handle his own housekeeping and pool cleaning for a while longer. "I'll have to go to plan B ...(which is to stay)," Tortorelli said. Sellers and real estate agents keep waiting for buyers -- particularly first-time buyers -- to jump in and buy. But the organization that put out Wednesday's report said so far, there's no sign of that happening -- that buyers seem to be waiting to see how low prices will go.

From the Sacramento Bee:

State Assembly candidate Kevin Jeffries of Riverside County could have bought a Sacramento-area condominium last month in anticipation of winning his election in November. The would-be legislator was smart to wait. "Some of the places we were looking at a month ago have already been discounted $10,000," said Jeffries, a Republican running in the 66th District. "We don't want to lose equity overnight as soon as we start escrow on it..."

The survey revealed a market still rapidly cooling from an unprecedented four-year boom. Though the same is happening nationally, the slowdown is most pronounced in the West, where Sacramento ranks among the hardest hit. It seems pretty clear to me that buyers in Sacramento are more or less on strike," said G.U. Krueger, chief economist with Irvine-based housing investor IHP Capital Partners...

Some area real estate officials said 11 straight days of triple-digit July heat contributed to the sales slowdown. Home builders said the growing market share of cheaper new condos also contributed to the price decline...

July also saw the biggest drop yet in year-over-year sales of existing homes in El Dorado, Placer, Sacramento and Yolo counties. The month's 2,877 sales were down 41 percent from July 2005. July marked the 16th straight month in the four counties that sales of existing homes were down from the same month a year earlier, according to DataQuick...

Buyers who once felt pressured to take any home they could afford before prices climbed higher now say they're willing to wait. "In terms of time we don't feel rushed any more," said buyer Mark Aizenberg, an investment officer with Wachovia Securities in Sacramento. Aizenberg, seeking a capital-area home in the $500,000 to $600,000 range, calls himself thankful that he didn't buy during the past eight months. "We're basically now not compromising on layouts and getting 800 square feet more house for the money," Aizenberg said. "I feel prices are going to come down significantly more."