More Open House Observations
As I described yesterday, I went to two open houses in the Belmar area on Sunday. Another observation I would make is the amount of pricing disparity that existed between the two similarly sized houses in the exact same neighborhood. House number 1 was listed for $50,000 more than house number 2. However, house number 1 also needed at least $25,000 more worth of work and upgrades to make it as nice as house number 2, which did not need any extra improvements. In short, at a minimum, house number 1 was priced at least $75,000 more than house number 2, even though both houses were in the same neighborhood and were about the same size.
In the coming months, I would expect the clearly delusional home owners, like those that own “house number 1” to adjust their asking prices lower to conform with the new lower market prices. As of now though, and as the broker of house number 1 suggested, many house sellers still think the market today is as strong as it was last spring and have yet to adjust to the new reality.
Weird Rationale
The broker who was selling the nicer of the two houses that I saw yesterday made a convoluted attempt to rationalize why this is an ideal time to buy a house. It goes something like this:
Houses that are for sale now have actually been on the market for longer than normal. Therefore, those sellers are more desperate to sell now, making it a good time to buy. Conversely, the houses that will be listed in the spring are new sellers, and they will be less desperate to sell, so the deals will not be as good.
As we all know though, old Fall 2005 inventory + new Spring 2006 inventory = huge Summer 2006 inventory = Fall 2006 price crash.
In the coming months, I would expect the clearly delusional home owners, like those that own “house number 1” to adjust their asking prices lower to conform with the new lower market prices. As of now though, and as the broker of house number 1 suggested, many house sellers still think the market today is as strong as it was last spring and have yet to adjust to the new reality.
Weird Rationale
The broker who was selling the nicer of the two houses that I saw yesterday made a convoluted attempt to rationalize why this is an ideal time to buy a house. It goes something like this:
Houses that are for sale now have actually been on the market for longer than normal. Therefore, those sellers are more desperate to sell now, making it a good time to buy. Conversely, the houses that will be listed in the spring are new sellers, and they will be less desperate to sell, so the deals will not be as good.
As we all know though, old Fall 2005 inventory + new Spring 2006 inventory = huge Summer 2006 inventory = Fall 2006 price crash.
posted by Little_Silvered at 8:31 PM
2 Comments:
I have friends that live in Belmar that put their house on the market 3 months ago..still on. They visited with us in Florida about a year ago and were bragging that their house "Tripled" in the last few years and they were plannning on "Cashin Out" I suggested they not wait too long as I had seen the market turn ugly in NJ when I lived there.
Let's see what happens! Will post if and when it sells.
I think that Monmouth County has experienced periods of volatility. Most of the volatility though is probably due to fluctuations on Wall Street. I specifically remember a large half way built house in Rumson that was boarded up after the market crashed in '87.
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