Monday, October 17, 2005

Realtors Changing Tune

Some realtors are now readily admitting that the 'market has changed' and how 'inventory is increasing.' There is a growing disconnect between the price a buyer is willing to pay and what a seller's price. A growing number of realtors are encouraging their clients to reduce prices and price them 'more realistically.'
Posted by David at 3:58 PM

3 comments:

  1. AnonymousOctober 17, 2005 11:51 AM

    It will be very interesting to see how long this takes to unwind. Of course some people will be quite stubborn, but others (flippers on borrowed money) may not be able to.

    I think the important psychological break will be when popular sentiment shifts from "housing never goes down" to "man I wish I had sold back at the peak." When you start hearing the latter out in the street, then the bubble will really start to unwind.

    ReplyDelete
  2. AnonymousOctober 17, 2005 5:00 PM

    Yeah, but for prices to fall in line with affordability... wow.

    In Montgomery County, Maryland, the average household income in 2003 was like 83K I think. Say, for argument's sake, it's 100K now.

    With 20% down and borrowing 3 times your income, a house should cost about $375,000. Now many new units are townhouses and condos, and the cheapest condos may cost that (though many won't), but I think I read that the median single family home runs north of 600K.

    If prices adjust to get back in line with my (high) estimates of affordability, that is a LOT of pain.

    ReplyDelete
  3. Chuck PonziOctober 18, 2005 12:48 PM

    Webster's definition of denial:
    "An unconscious defense mechanism characterized by refusal to acknowledge painful realities, thoughts, or feelings"

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