Days on market vs. price expectation

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Submitted by moneymaker on May 15, 2015 - 10:03am

How many days on market today suggests unreasonable price expectation by seller? I'm thinking 45 or more. Should have made this a poll but got to leave here soon, seems like a lot of houses are lingering when there is low inventory.

Submitted by Coronita on May 17, 2015 - 10:46am.

rockingtime wrote:
Or the people saying: Buy now or be priced out for ever :-)

True. Too. But I think for folks that didn't buy or didn't buy what they really wanted. They are for practical purposes priced out right now. And the decline this time it seems will take a lot longer since most of the ones that were sketchly financed last time aren't even active right now.

Submitted by spdrun on May 17, 2015 - 11:12am.

They're still active in the form of HELOCs and protections from the 2013 foreclosure law running out. Also, even a 10-20% decline will put a lot more people under water again. This will of course more likely happen at the lower to middle end of the market.

Submitted by Coronita on May 17, 2015 - 11:45am.

spdrun wrote:
They're still active in the form of HELOCs and protections from the 2013 foreclosure law running out. Also, even a 10-20% decline will put a lot more people under water again. This will of course more likely happen at the lower to middle end of the market.

Sure. If you say so.

Submitted by spdrun on May 17, 2015 - 12:05pm.

Fact is, you sarcastic little snit, starting to see more short sales list at the lower end. Tick. Tock. Tick. Tock.

We're talking about properties that are still 30% below what they borrowed. Read about what's going on in NJ. Distress can be delayed, but eventually the sales will move forward.

Submitted by an on May 17, 2015 - 1:08pm.

We all know real estate are all local. I don't see very may short sale around here. So your statement is false.

Submitted by an on May 17, 2015 - 1:10pm.

spdrun wrote:
They're still active in the form of HELOCs and protections from the 2013 foreclosure law running out. Also, even a 10-20% decline will put a lot more people under water again. This will of course more likely happen at the lower to middle end of the market.

Prove it. I'm sick and tire of hearing about this shadow inventory. Been hearing about it for almost 10 years. When are they coming and how many? Would it actually affect market price?

Submitted by Coronita on May 17, 2015 - 1:58pm.

spdrun wrote:
Fact is, you sarcastic little snit, starting to see more short sales list at the lower end. Tick. Tock. Tick. Tock.

We're talking about properties that are still 30% below what they borrowed. Read about what's going on in NJ. Distress can be delayed, but eventually the sales will move forward.

I'll have to take your word for it in what happens in NJ. I don't care about what happens in NJ. I only care about what happens in CA and maybe Washington or Oregon. I have no desire to be in NJ or invest there.

So, if you say so, it must be true in NJ.

I like my tiny little island of non-diversity. Like I said, diversity is overrated.

Submitted by Coronita on May 17, 2015 - 1:34pm.

AN wrote:
spdrun wrote:
They're still active in the form of HELOCs and protections from the 2013 foreclosure law running out. Also, even a 10-20% decline will put a lot more people under water again. This will of course more likely happen at the lower to middle end of the market.

Prove it. I'm sick and tire of hearing about this shadow inventory. Been hearing about it for almost 10 years. When are they coming and how many? Would it actually affect market price?

At least in SoCal and Bay Area....
(crickets chirping...)

Submitted by flyer on May 17, 2015 - 3:45pm.

I agree that there are probably quite a few of us who are not extremely effected by what the RE market does, especially if our kids are already established.

For people just entering the market, trying to move up, or trying to pick up more properties, etc., it's a different story, so I can also see where sp is coming from, but it's still difficult to compare the CA to the NJ market.

Submitted by njtosd on May 17, 2015 - 6:34pm.

spdrun wrote:
Fact is, you sarcastic little snit, starting to see more short sales list at the lower end. Tick. Tock. Tick. Tock.

We're talking about properties that are still 30% below what they borrowed. Read about what's going on in NJ. Distress can be delayed, but eventually the sales will move forward.

A quote from Asbury Park Press (1/12/15):

"New Jersey's job growth rate in the last year ranks dead last in the continental United States. The U.S. has more than regained the nearly 9 million jobs that it lost during the recession that lasted from 2007 to 2009. New Jersey has recovered fewer than half of the lost 257,900 jobs, and its job growth is losing what little steam it had."

http://www.app.com/story/news/investigat...

NJ is in trouble - it has ignored its big money makers (actually, it seemed more like it decided to detest pharma) and this is the result. Can't compare this to CA.

Submitted by gzz on May 18, 2015 - 12:05am.

It is wrong to assume that a recession would cause San Diego house prices to fall.

Nominal home prices have only fallen twice in modern history in San Diego: 1990-1997 and 2007-2011. They went down in the mid 90's despite the extremely strong national economy, and they went up quite rapidly during the 2001-03 recession. Finally, they were flat in the short but very intense 1982 recession (unemployment peaked at 10.8%, higher than our recent very long recession).

San Diego has a large number of well-paying jobs, is a favored place for the wealthy to vacation, have second homes, and retire, and has basically run out of nice locations to develop.

Historical valuation matrices don't account for the fact that interest rates are extremely low. Rich put up a chart that does, and it shows that prices right now are extremely low taking this into account:

http://piggington.com/images/san_diego_h...

I also think it is only a matter of time before mainland Chinese buyers start branching out from their favored UTC-centered buying habits into other areas of San Diego.

Submitted by spdrun on May 18, 2015 - 7:10am.

Looking at lower-end condo prices, I've seen quite a few that sold for $50k in the mid 80s and went for half that in the early 90s. So at least in some segments, there was a drop from the 80s through the 90s as well.

Submitted by Coronita on May 18, 2015 - 7:19am.

spdrun wrote:
Looking at lower-end condo prices, I've seen quite a few that sold for $50k in the mid 80s and went for half that in the early 90s. So at least in some segments, there was a drop from the 80s through the 90s as well.

Sure...If you say so.

You aren't going to get you 60+% off beach front property in SoCal sub $500k. Ain't gonna happen. Keep dreaming.

Submitted by spdrun on May 18, 2015 - 7:23am.

I do say so. Here's one example of what I'm talking about as far as lower-end condos still (not) selling below their 2000s peak...

http://www.sdlookup.com/MLS-140052722-69...

Last sale, $308k in 2005. On market over 6 months for $237k.

I'm not looking for 60% off. I'm looking for 20-30% off property in blue-collar areas that I can rent without too much difficulty.

Submitted by Coronita on May 18, 2015 - 7:26am.

spdrun wrote:
I do say so. Here's one example of what I'm talking about as far as lower-end condos still (not) selling below their 2000s peak...

http://www.sdlookup.com/MLS-140052722-69...

Last sale, $308k in 2005. On market over 6 months for $237k.

I'm not looking for 60% off. I'm looking for 20-30% off property in blue-collar areas that I can rent without too much difficults.

And what makes you think you'll get an additional 40-50% off this point on?

No one is disagreeing with you that prices in some places won't return back to peak. But you seem to be of the notion that these places are going to crater another 40-50% once interest rates go up. Ain't gonna happen.

The bottom for these places were in the $120k-140 range BTW....Also, being the close proximity to sdsu...rents for $1300-1400/month....Well, this won't probably won't because it's a piece of shit...There are much nicer places that are larger and costed less.

Submitted by spdrun on May 18, 2015 - 7:30am.

You yourself seem to be predicting a slow decline. Are you just trolling at this point?

And the decline this time it seems will take a lot longer since most of the ones that were sketchly financed last time aren't even active right now.

Submitted by Coronita on May 18, 2015 - 7:33am.

spdrun wrote:
You yourself seem to be predicting a slow decline ...

And the decline this time it seems will take a lot longer since most of the ones that were sketchly financed last time aren't even active right now.

In this particular hood. I think there will be a floor, simply because of the close proximity to SDSU. And rent is around $1400/month give and take $100/month. Maybe not this POS you picked, but others better that costed much less ...

Also, I'm expecting the banks to relax lending standards in the future, so instead of buyers only being investors for things like this that typically buy with all cash (and hence not really affected by interest rate fluctuations imho), there will be people who right now can't qualify to own will be able to. The fact that we are in the $200k ranges for these POS condos without the relaxed lending standards and less than stellar buyers is already surprising enough for me. I would have thought prices in this area would have stayed depressed much longer. At $200k, cash flowing them is already going to be slightly challenging.

Submitted by spdrun on May 18, 2015 - 7:37am.

I'm not sure if we're in the $200k range for those condos. Note that this unit is NOT selling at $237k or anything close to it.

Banks can't relax lending standards more without Dodd-Frank going away, which isn't happening for another 2-3 years at least. We'd probably need a GOP president for that, and the GOP is no friend of the GSEs and Mel "the skell" Watt. GOP control might lead to relaxation, but it might also lead to a more restrictive/privatized market as well.

Submitted by Coronita on May 18, 2015 - 7:38am.

spdrun wrote:
I'm not sure if we're in the $200k range for those condos. Note that this unit is NOT selling at $237k or anything close to it.

We are... Some of them that has closed in the $200k range. This one, again, is a POS and probably overpriced... Even if not, like I said. Most of these are investors held (probably). So if they were bought recently, they were purchased most likely with cash. Because owner occupancy in these areas most likely were <50% making traditional financing for investors not an option. Unless you were folks that cashed out refinanced another rental properties that were more owner occupied elsewhere to pay for ones here....

You can count on the banks to relax lending standards again. Because banks make more money off of subprime borrowers than they do off of me. And when they do that, that plays much more at the low end versus the high(er) end, imho.

Submitted by spdrun on May 18, 2015 - 7:51am.

Not gonna work unless Dodd-Frank is changed, and that's not going away any time soon. Debt-to-income is basically set in stone. Even the move to 3% down payments is a bit of a sham, since (a) they existed before 2013 anyway, and (b) down payment is limited by debt-to-income and appraisal for most people.

Interesting fact: 6927 Amherst #16 sold for $240,000 in late 2014. The unit I posted is sitting at $237,000 for much longer. They might be lucky to get $200,000 or $220,000. Seems that there might be a bit less demand for any junk that comes onto the market this year vs last. Funny, that.

There was a brief period in 2013-2014 where one could find a buyer for any turd that was thrown onto the market at an insane price. This period has passed and the herd has stopped stampeding.

Submitted by Coronita on May 18, 2015 - 8:10am.

spdrun wrote:
Not gonna work unless Dodd-Frank is changed, and that's not going away any time soon. Debt-to-income is basically set in stone. Even the move to 3% down payments is a bit of a sham, since (a) they existed before 2013 anyway, and (b) down payment is limited by debt-to-income and appraisal for most people.

Interesting fact: 6927 Amherst #16 sold for $240,000 in late 2014. The unit I posted is sitting at $237,000 for much longer. They might be lucky to get $200,000 or $220,000. Seems that there might be a bit less demand for any junk that comes onto the market this year vs last. Funny, that.

There was a brief period in 2013-2014 where one could find a buyer for any turd that was thrown onto the market at an insane price. This period has passed and the herd has stopped stampeding.

Sure. If you say so. In that case. I dont see investors needing to sell( at a discount). I sure wasn't counting on appreciation this quickly. As far as I am concerned. It is icing ont the cake. For practical purposes these condos have already changed hands from the weaker hands to the strong. That happened when these were in the $140k range.

Submitted by spdrun on May 18, 2015 - 8:21am.

I'm posting numbers, you're quacking "sure if you say so" repeatedly like an 4 year old in need of sleep. Got any more persuasive arguments?

I'm saying that there seem to be a number that DIDN'T change hands and gave one example. What makes $200k the right price vs $140k, BTW? $240,000 sure wasn't right with the rent you quoted. That would represent about a 4% return, which is good for parts of Manhattan, not for a secondary part of San Diego.

Submitted by Coronita on May 18, 2015 - 8:36am.

spdrun wrote:
I'm posting numbers, you're quacking "sure if you say so" repeatedly like an 4 year old in need of sleep. Got any more persuasive arguments?

I'm saying that there seem to be a number that DIDN'T change hands and gave one example. What makes $200k the right price vs $140k, BTW? $240,000 sure wasn't right with the rent you quoted. That would represent about a 4% return, which is good for parts of Manhattan, not for a secondary part of San Diego.

Sure, if you say so. Seems to me, the person isn't in a hurry to sell, otherwise it would have been a short or REO a long time ago.

$200k price isn't "right or wrong". It's what the market commands. Keeping trying to rationalize it...If it floats your boat.

Submitted by spdrun on May 18, 2015 - 8:38am.

Regardless, the fact that it (and others like it) is sitting is reflective of pricing conditions vs last year. Is your repetition of "sure if you say so" indicative of drain bramage or just lack of creativity?

Maybe you should spend some time hanging out with people not just like you to improve your creative prospects.

Submitted by Coronita on May 18, 2015 - 8:43am.

spdrun wrote:
Regardless, the fact that it (and others like it) is sitting is reflective of pricing conditions vs last year. Is your repetition of "sure if you say so" indicative of drain bramage or just lack of creativity?

Maybe you should spend some time hanging out with people not just like you to improve your creative prospects.

Whatever floats your boat, chief. I'm enjoy wasting my time arguing with a brick, because I'm a brick too.

You're right, I should spend more time with more creative and diverse people who are worldly and refined...Why do you think I'm spending so much time talking to you...on this blog?

So far, I learned a lot of what it takes to have a lot of pent up hate ... I've also learned a lot about New Jersey :)

Submitted by spdrun on May 18, 2015 - 8:49am.

Hate is the wrong word for what I feel. More obliviousness in this instance.

Submitted by Coronita on May 18, 2015 - 9:15am.

spdrun wrote:
Hate is the wrong word for what I feel. More obliviousness in this instance.

If you say so :)

Submitted by spdrun on May 18, 2015 - 9:16am.

Hahahahaha. Can you just change your nick to ifyousayso already? ;) kaisersayso would also work.

Submitted by fun4vnay2 on May 18, 2015 - 9:55am.

.....

Submitted by fun4vnay2 on May 18, 2015 - 9:57am.

gzz wrote:
I

San Diego has a large number of well-paying jobs, is a favored place for the wealthy to vacation, have second homes, and retire, and has basically run out of nice locations to develop.

I also think it is only a matter of time before mainland Chinese buyers start branching out from their favored UTC-centered buying habits into other areas of San Diego.

All the above are facts not fiction.
A lot of people told me the same thing in 2007 when I was exploring real estate in san diego. Per them becaus eof above stated facts, real estate in SD would never go down.

I was not convinced though and finally bought in 2011 :-)

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