Ok, I'm about to recommend an article in the OCRegister's Real estate section.
I'd better check on season tickets for skiing in the afterlife... ;)
The Article
Let's see... bottom in 2010...
No price appreciation before 2013...
Hmmm... I would slide the 2010 to 2011, but gee, we finally have a post that removes the 'six month' blinders! I'm shocked!
Oh, on bidding wars, I'm noticing that has cropped up on the HBB blog today. There are too many pigs going through this python. Too many surplus homes. We've talked before how these lies would keep cropping back up...
A little reminder on my thinking:
I'm still planning, assuming I'm employed then, to buy in 2010. Now... I'm also assuming homes drop most of the remaining 30% they should be dropping by then too. If not... I'll wait.
As to bidding wars, I'm not going to ever believe that. Even if true, what's the worst that happens? You find the next good home.
Bidding wars do not become common until inventory drops below 3 months. Be really suspicious if you shop during these high inventory times and people discuss bidding wars. Oh... under-market priced short sales, foreclosures, and estate sales will probably attract bidders. One wise seller, in a down market back in 1992, noted that if you price your home initially at 97% of market price, you should expect to sell for 102% of the current market price. He sold at 103% of what we agreed was a fair market price.
I'm going to consider finding the place listed at 102% of market price and bid below market. How much further below 'market' will depend on the conditions then. There is always a market clearing price. So sellers with 100% equity can always sell. So Mr. Banker... what's the sales price? ;)
Got Popcorn?
Neil
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3 comments:
Neil said...
"As to bidding wars, I'm not going to ever believe that."
Well, you should, Ive been outbid 4 times in the last 2 months (yes I am shopping now). Knowing I have been following the market closely, my neighbor asked me to help him evaluate bids on his place - he got 8 offers in 72 hours!!!
As I see it, there is 2 types of listings, 80% of it is the first type which is crap or severely over priced. They get no action, just sit there forever.
The other 20% of stuff is attractive and competitively priced - here bidding wars arent uncommon - the pent up demand (which exists) is basically competing for the same 20% of the housing stock!
HOWEVER, your attitude "Even if true, what's the worst that happens? You find the next good home." is the correct way to view things. My assumption is eventually more of the 80% sellers will get more realistic, and as more of the "most pent up" pent up demand gets whittled away, I will get my turn at bat. It will happen eventually.
That said - make no mistake, there are indeed bidding wars out there whether you want to believe it or not...
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