Listings That Linger Have Become Prey For Hard-Dealing Buyers Wielding Lowball Offers
A report from KTVN in Nevada. "Reno's Midtown area continues to grow. More housing options have become available in recent weeks. 'It was a little slow for about a month, and now the last two weeks we've had a major uptick,' said Timothy O'Brien, a Realtor with Dickson Realty. 'So I've gone from just a couple of listings to about a dozen listings in just the last couple of weeks, so its gotten really hot. You're seeing sellers come down a little bit, trying to stay competitive, and buyers are doing a lot better job of getting pre-qualified and being ready before we get started.'"
"The area isn't cheap. 'Everything around here is going pretty much for $300 a square foot which is a lot,' O'Brien said. 'Prices have gone up a lot since 2012; probably about 140%. So you're seeing massive increases but we're just kind of peaking back out, I think. I think we're going to see things steady up a little bit as more things come on the market.'"
"Christopher Cunningham, a Senior Loan Officer with Guild Mortgage Company, says there are programs to help buyers, even in a tough housing market. 'Fannie Mae and Freddie Mac have gotten creative recently with higher debt-to-income ratios allowable,' Cunningham said. 'Guild offers a first-time homebuyer program. The State of Nevada and Rural Housing have tons of down payment programs that can help with down payments and closing costs. You see a lot of realtors asking the seller to cover closing costs these days, so the affordability is there if you can get creative.'"
"He says a lot of clients are surprised when they find out what they qualify for. 'Every day I find someone who is scared to even start the process leave my office and is ecstatic to look for homes,' Cunningham said. 'And who doesn't want to buy a home? It's so exciting!'"
The Denver Post in Colorado. "The days when a home in metro Denver would list on the market and set off a feeding frenzy that brought in multiple offers are fading. Redfin tracks the number of offers received on transactions where it represents the buyers. A year ago in June, half of all sales in metro Denver came with multiple offers. But at the start of this year, the ratio was down to one in five."
"'Bidding wars are few and far between this season. They are reserved for homes that are priced relatively low and are in good shape or homes in hot areas that are priced correctly,' said Andy Potarf, a Redfin senior agent in Denver."
"That partly reflects the more abundant choices that buyers have. At the end of June, there were 9,520 homes listed for sale in metro Denver, up 28 percent from a year earlier and the highest inventory available since October 2013, according to the Denver Metro Association of Realtors."
"Sellers can’t price their homes above the most recent sales in their neighborhood and then sit back and wait for a bidding war to start, Potarf said. 'Homes have to be upgraded and priced competitively or maybe even slightly below market to garner more attention,' he said."
The Orange County Register in California. "The last time Southern Californians had more homes on the market at mid-year was 2014. According to ReportsOnHousing, there were 36,904 existing residences in the four-county region listed for sale as of June 27. Yes, that’s a five-year high for the mid-point of a year — a key seasonal moment near the end of the usual prime homebuying season."
The Houston Chronicle in Texas. "The market appears to be tilted in favor of buyers on the high end — where the supply of homes priced between $750,000 and $1 million is more than 10 months, according to the realty data, which is based on sales throughout primarily Harris, Fort Bend and Montgomery counties."
"'We knew it would be difficult to top last June’s record-breaking sales volume, but the Houston real estate market remains strong and now offers prospective buyers an even greater selection of housing than they’ve had in some time,' Shannon Cobb Evans, the association’s chair, said in a statement."
"And single-family listings, which have been rising most of the past year, reached 30,222, an amount not seen since 2011. 'Our buyer agents are freaking out because we don’t have the number of leads we had two months ago,' said Lance Loken of the Loken Group. 'In March, April and May, the doors were knocking down with buyers. They’re starting to really slow down.'"
The Tampa Bay Times in Florida. "Home prices in Tampa Bay have risen steadily for years, growing at a faster rate than wages in the area. Combine that with the fact that the region has the lowest median household income among the nation’s largest metro areas and the result is what State Rep. Ben Diamond called a 'perfect storm' creating an affordable housing crisis."
"Diguel Atkins and his family have felt the pressure of trying to find an affordable place to live for as long as he can remember. He said Bartlett Park is gentrifying, that homes are rising in value, and that in turn is forcing longtime residents out. Foreclosures are becoming more commonplace, he said."
From Forbes on New York. "A third of the active New York City sales listings on StreetEasy received price cuts as of mid-June, according to a new report from the site, but the discounts probably won’t yield more buyers, experts say."
"Price cuts are a growing trend as the market struggles to cope with the slow-end of a cycle. The number of homes on StreetEasy with reductions rose from 20% in 2014 to 32% in 2018, according to its data. Sellers chopped a record $3.2 billion from the asking prices of all homes on the site in 2018, equaling roughly 10% of their total value."
"However, while the strategy is meant to attract fresh attention like last season’s trends on the sales rack, they more often imply weakness for the seller, according to StreetEasy. Of all the homes sold through StreetEasy that received price reductions between 2014 and 2018, four out of five closed for lower than their final ask, the site reported. In other words, 80% of sellers accepted an offer that was lower than their discounted value."
"'Listings that linger on the market have become prey for hard-dealing buyers wielding lowball offers,' explained StreetEasy senior economist Grant Long explained in the report. 'Buyers should view price cuts as an opportunity to pick up a deal - not because of the unit’s new asking price, but because of the seller’s seeming willingness to cut a deal for even less.'"