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Sellers Befuddled, Asking What Happened To Our Hot Market?

A report from the Denver Post in Colorado. “Sellers have remained in firm control of metro Denver’s housing market for four years, with inventory shortages, quick sales and escalating home prices par for the course. The imbalance has lasted for so long, it is hard to remember what a more balanced market looks like. But agents warn that things are finally moving in that direction. ‘In comparison to the last four years it feels foreign,’ said Kerron Stokes, a broker with Resource Group at REMAX Leaders in Centennial.”

“In June, metro Denver’s housing market began to show signs of cooling after a hot run at the start of the year. More sellers had to drop their asking prices, fewer buyers attended showings and made offers, and homes took longer to sell. From record highs reached in May and June, prices have come down 4.9 percent.”

“Some wrote that off as the usual seasonal slump coming early. Things would rev up again in January. repeating the pattern of recent years. But in September, home sales fell hard despite a lot more properties on the market.”

“That disproved a common explanation that a lack of inventory was what was holding back home sales in metro Denver.”

“‘The amount of showings per listing is dropping. The days on market are increasing. It is telling us that there are fewer buyers and less activity,’ said Steve Danyliw, chairman of the market trends committee at the Denver Metro Association of Realtors.”

“Last month, there were 3,989 single-family homes and condos sold in metro Denver, a drop of 28.9 percent from August and 20.2 percent from a year earlier. The last time so few homes sold in a September was back in 2012, according to DMAR.”

“The inventory of homes available for sale shot up 7 percent from August to 8,807, the highest number available since the fall of 2013, when the Denver market was starting to take off. Normally, the number of homes available for sale drops slightly in September.”

“One of the hardest tasks agents say they face now is convincing sellers, long accustomed to calling the shots, to lower their expectations, especially when it comes to how much money they can get.”

“Robin Olsen learned first-hand when she and her husband tried to sell their Sunnyside home this summer. Going in, Olsen said her reference point was a friend who listed an old, small and unrenovated home near the University of Denver. Within hours, a buyer made a cash offer, sight unseen, at $90,000 above the asking price.”

“‘I am hearing the story and thinking this will happen to me. It won’t be on the market for more than a few hours,’ she said.”

“Although the home, listed initially at $669,000, received lookers, no offer emerged after 72 hours. Olsen couldn’t understand why a home in Denver’s popular northwest corner wouldn’t fly off the shelf.”

“Two price drops brought the listing down to $629,000, a price that drummed up more interest and helped land a buyer nearly three weeks later. Through it all, Olsen said she repeatedly had to remind herself to breathe deep, stay calm and realize it was only a business transaction.”

“‘It was almost three weeks and to me that felt like three years relative to the stories we heard,’ she said. ‘It was definitely emotional. There were some days I needed to go for a walk.'”

“Lisa Huntington-Kinn, the agent who handled the listing, credits the Olsens for listening to her and moving quickly to drop the price when the offers weren’t showing up. Some sellers are more stubborn. ‘Buyers always determine what your house is worth. It doesn’t matter what I think it is worth and what you think it is worth,’ she said.”

“‘We have gone from that insane crazy marketplace to not so insane or crazy,’ Danyliw said. But that has left sellers befuddled, asking what happened to our hot market.”

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This Post Has 53 Comments

  1. ‘That disproved a common explanation that a lack of inventory was what was holding back home sales in metro Denver’

    It disproves a bunch of crap the REIC peddles. What happened to our shortage?

    1. Sure does. The investors who wanted to time out the highest value for there shack caught wind of the peak and all jumped ship together. The FBs took the bus back to China town and now there are no buyers. Days of reckoning are upon us. Only the smart will survive. Take a hit and get out while you can greedheads!

  2. ‘One of the hardest tasks agents say they face now is convincing sellers, long accustomed to calling the shots, to lower their expectations’

    It’s interesting how the media slowly unravels the myths they’ve built around a mania. Long accustomed : just how many shacks do these “sellers” have? Do they sell one a year and that’s how they became accustomed? Or is the the years of being told trees grow to the sky and they can sit back and watch huge amounts of (borrowed BTW) money transfer into their bank accounts?

    ‘her reference point was a friend who listed an old, small and unrenovated home near the University of Denver. Within hours, a buyer made a cash offer, sight unseen, at $90,000 above the asking price’

    So that guy is fooked.

    ‘I am hearing the story and thinking this will happen to me. It won’t be on the market for more than a few hours’

    Is it not incredibly insane to expect a shack to sell in hours? Oh, by all means take a walk Robin, take a breath. It will only take 30 years to pay back that sh$t-load of money. Notice the media is leaving out what happens to the poor bashtards buying these shacks.

    1. “Although the home, listed initially at $669,000, received lookers, no offer emerged after 72 hours. Olsen couldn’t understand why a home in Denver’s popular northwest corner wouldn’t fly off the shelf.”
      “Two price drops brought the listing down to $629,000, a price that drummed up more interest and helped land a buyer nearly three weeks later. Through it all, Olsen said she repeatedly had to remind herself to breathe deep, stay calm and realize it was only a business transaction.” “‘It was almost three weeks and to me that felt like three years relative to the stories we heard,’ she said. ‘It was definitely emotional. There were some days I needed to go for a walk.’”

      I looked this victim up because I felt so horrible for her. The facts were is that she sold her home in three weeks for 50% more (or 200k) more than she paid for the place 6 years ago. Rather than feeling grateful or lucky, she seemed traumatized. There are thousands of ppl in Denver working hard here that cannot afford decent housing, and this scum bag was stressed about only making $200k off a house flip. What a disgusting human being.

      https://www.zillow.com/homes/make_me_move/Sunnyside-Denver-CO/pmf,pf_pt/13299537_zpid/403514_rid/500000-_price/2084-_mp/globalrelevanceex_sort/39.78928,-104.991832,39.764378,-105.031529_rect/14_zm/1_rs/?

      1. I highly doubt she even turned a profit. It appears she lived in it for 5 years then decided to rent it for $4300/mo which took her 3 months to find a tenant and a $1300 haircut to boot, that is if it actually rented. All the carrying costs add up quick and all renovations look recent and probably cost around 75-100k (maybe this was done prior to her purchasing?). After all the expenses I would be surprised if she saw any profit.

        9/7/2018 Sold $610,000
        8/1/2018 Pending sale $625,000
        7/23/2018 Price change $625,000
        7/18/2018 Price change $649,900
        7/12/2018 Listed for sale $669,900
        12/3/2017 Listing removed $3,000
        11/29/2017 Price change $3,000
        11/8/2017 Price change $3,750
        10/17/2017 Price change $3,900
        9/6/2017 Listed for rent $4,300
        9/12/2012 Sold $412,000
        6/30/2012 Listed for sale —
        10/22/2010 Listing removed $405,000
        10/7/2010 Listed for sale $405,000
        9/3/2010 Listing removed $399,000
        6/4/2010 Price change $399,000

    1. You touch, you buy, no refunds! Let’s go through rocks at our air box!!! So these FBs are mad they made a bad decision and blame the sellers… as far as I’m aware, buying a home is not like buying a item from Costco that you can simply return no questions asked just because they marked it down a few months later.

    2. The protesters, some seen holding Chinese-language placards that read “return my hard-earned money”, gathered at a Country Garden residential projects in Shangrao, Jiangxi, and at another project by the developer in Pudong, Shanghai on Saturday.

      BWAHAHAHAHAHAHAHAAAA!!! From “investors” to bagholders at the stroke of the developer’s pen. Sorry, protesters, but these soon-to-be-insolvent developers won’t be returning your money. If it’s any consolation, the new knife-catchers will soon be stamping their little feet alongside you as the plunge in housing prices engulfs all of China.

    3. It’s not going to happen in the US. This is a problem which is uniquely China’s, due to an overly rapid transition from communism to crony capitalism, overlaid with a heaping helping of denial.

      1. I don’t think the West coast is immune from goings on in China. There had been a fair bit of Chinese $$ chasing West Coast real estate. Less Chinese demand = lower prices. Then there is the whole momentum thing once prices go flat or start falling urgency turns to “take your time” to “lets wait it will likely be cheaper later” My house has gone up 2.5X from 2011 that is frankly crazy, HBB is just pointing that out and rightly so.

        1. “My house has gone up 2.5X”

          That all sounds good but find a buyer at that price.

          As a wise man once said….“I can ask $50k for my 10 year old Chevy pickup but where is the buyer at that price?”

          He’s right.

          Oxnard, CA Housing Prices Crater 6% YOY As CA Housing Demand Collapses On Record High Inventory

          https://www.movoto.com/oxnard-ca/market-trends/

          1. Well it is a townhouse so somewhat of a commodity, more or less identical versions have sold in the past few months. I fully expect the value to go down, but hopfully not to what I paid for it.

    4. Oh dear. The Hong Kong lemmings who rushed to snap up ultra-expensive real estate are now trying to unload their “investments” by slashing prices. I thought the idea behind investment was to buy low and sell high.

      https://www.scmp.com/business/article/2167354/few-takers-property-market-jittery-individual-owners-cut-prices-hk800000

      Jittery individual owners, aware of the risks from rising mortgage rates, turbulent stock market and weakening economic outlook, are offering massive price cuts as they expect sentiment to sour further.

  4. Snip it from that article:

    “Don’t expect 30 potential buyers to make the showing, don’t expect a solid offer within 72 hours and don’t refuse reasonable requests like inspections, repairs and contingency clauses”

    The UHS are going to have to start working now to get paid? Inspections, repairs, contingencies??? That’s going to delay there commission checks and take away the precious time they could be spending plotting out there next victim. And those poor sellers “Suzy sold her place for above asking in 72 hours just a few months back, wha wha wha happened, I need to go do some yoga to calm my greedy nerves”.

    1. ‘The UHS are going to have to start working now to get paid?’

      It’s a lot worse than that. 80 to 90% of UHS hardly make a sale a year. Limping along with a flip here and there. That’s gone. They’ll be looking for a real jobs. Remember the Orange County mortgage broker recently? “Everybody is hurting!”

      Now comes the reversal of the phony wealth effect. Legal, accounting, engineering, construction, finance, all grinds down. No more new cars. No more weekends in Aspen. Malls get hammered. Government budgets. Everything was so much fun when it booms – no one cared what happens when it ends.

      Think about that. Isn’t government supposed to be the sober overseer? Isn’t it the job of central banks to make sure this fake money doesn’t cause this? But in fact they purposefully caused it.

      Central banks may do more harm than good, says head of India’s central bank

      Published: June 18, 2016

      “A bridge that relies on wealth effects, you better hope that you got enough growth to justify the asset price increase which created the wealth effect in the first place.” Raghuram Rajan

      1. Now comes the reversal of the phony wealth effect.

        Bingo. Fake wealth created by fake Fedbux, benefiting the few at the expense of the many. Now the full scale of the fraud of the “recovery” wrought by the Bernanke-Yellen radical Keynesian monetary experiments since 2008 is about to be fully exposed. Only the super-wealthy benefited from all those printing-press trillions; everyone else lost ground.

        1. ‘Only the super-wealthy benefited from all those printing-press trillions; everyone else lost ground’

          Robin in Denver did alright. The buyer, who the Post didn’t interview, is holding the bag.

          1. Millions of buyers who overpaid are going to be left holding the bag. A huge number of those will have no qualms about shirking their financial obligations and walking away from their underwater shacks, meaning lenders are going to topple like dominoes unless they get another bailout. In the current political environment, where millions of former sheeple have become awake and aware – and despise our financial and political elites – the Fed, Wall Street, and the Republicrat duopoly are going to have a tough sell bailing out the banksters yet again.

          2. ‘a tough sell bailing out the banksters’

            That’s not the problem:

            May 25, 2018

            “In his corner of American finance, where hard selling meets hard luck, Angelo Christian is a star. Each time Christian sells a home loan, the company he works for, American Financial Network Inc., takes as much as 5 percent. Many of Christian’s customers have no savings, poor credit, or low income—sometimes all three. Some are like Joseph Taylor, a corrections officer who saw Christian’s roadside billboard touting zero-down mortgages. Taylor had recently filed for bankruptcy because of his $25,000 in credit card debt. But he just bought his first home for $120,000 with a zero-down loan from Christian’s company. Monthly debt payments now eat up half his take-home pay. ‘If he can help me, he can help anyone,’ Taylor says. ‘My credit history was just horrible.’”

            “Christian can do this kind of deal because he is, in effect, making the loan on behalf of the federal government through its most important affordable housing program. It’s a sweet deal: He gets his nearly risk-free commission. Taylor puts no money down. If things go south, the government ultimately bears the risk. Many borrowers ‘are living paycheck to paycheck and, if they lose their jobs, they go into default immediately,’ says John Burns, a housing consultant.”

            http://thehousingbubbleblog.com/?p=10443

          3. I wonder about the Robins of the world, ie the winners of the bubble lottery. Will she be satisfied with the lousy returns of a savings account or mutual fund on that 200k, or expect more 50% gains?

            It’s interesting to think of the effect on the economy from these bubble windfall people and what they reinvest in, enabling inevitably higher risk and possibly fraudulent ventures because they have been conditioned to think a 50% return for doing nothing is totally normal and they are entitled to it.

    1. “…lenders are going to topple like dominoes unless they get another bailout.”

      And for that reason, another bailout is in the bag. US housing finance has been, and remains, too big to fail. Runways need lots foam to keep banks from making crash landings.

      1. “Many of Christian’s customers have no savings, poor credit, or low income—sometimes all three.”

        Where do the funds used to originate these subprime mortgages themselves originate? And what makes it pencil out to lend money to people who seem highly unlikely to ever repay it?

        I guess it must be yet another instance of ‘turtles all the way down. ‘

        1. ‘Where do the funds…originate?’

          They use lines of credit. Then they get paid when the government funds the loan. It’s all very short term and there’s no capital behind it at all, except for some desks and ficus trees. This is going to fall on the GSE’s.

          A troll recently said “the gubermint won’t let shack prices fall!” The gubermint is who will be doing the foreclosing.

          1. “The gubermint is who will be doing the foreclosing.”

            Is this perhaps a stepping stone in the affordable housing masterplan? After myriad foreclosures, perhaps Uncle Sam can resell their foreclosure home inventory for truly affordable prices!

        2. “Christian can do this kind of deal because he is, in effect, making the loan on behalf of the federal government through its most important affordable housing program. It’s a sweet deal: He gets his nearly risk-free commission. Taylor puts no money down. If things go south, the government ultimately bears the risk. ”

          With Republicans in control, is there at least some hope that U.S. taxpayers will not be asked to pony up bailouts to rescue neer-do-well subprime outfits like American Financial Network Inc.?

          2. “After myriad foreclosures, perhaps Uncle Sam can resell their foreclosure home inventory for truly affordable prices!”

            In San Jose, CA 30+ years ago the federal government turned many of their REO properties over to HUD who turned them into Section 8, and a tidal wave of crime followed.

  6. Not in the this article but if you check on the other articles a picture emerges. China is getting crushed by the trade war. It’s foreign reserves are diminishing and it is putting on more and more capital controls. This has to occur since its trade surplus is being reduced. It is paying more for soybeans due to self inflicted wounds. China is selling less steel due to our tariffs and it is not just the steel that was flowing directly to us, it is the steel that was sent to third countries and then to the u.S. Thus, the reason the Trump administration needed to put tariffs on virtually all imported steel and aluminum. China has reduced ” investment” in the U.S. by 92%. This has caused corrections in U.S. housing while its own housing is falling even faster because the supply chain is changing and companies are finding new places to produce due to the existing tariffs and the threat of higher tariffs. Yes, most of the production will not move back to the U.S. due to costs. However, it is far better for production to be occurring in Mexico than China. we will indirectly get some of benefits, connected to all this:
    https://www.scmp.com/business/article/2167354/few-takers-property-market-jittery-individual-owners-cut-prices-hk800000

    1. A cogent analysis, ABQ Dan. My fear is that as China’s bubbles burst, there is going to be serious social unrest, causing the corrupt, inept CCP to embark on some kind of military adventurism to rally the proles around the flag. China has been working flat out to build a military capable of fighting and winning regional wars, while our’s has been depleted and spread thin by 17 years of the Global War on Terror and neocon regime change fiascos.

      https://www.scmp.com/news/china/politics/article/2166969/chinese-military-strategist-who-inspired-steve-bannon-attacks

      1. It is a real threat Boo. However, allowing China to get stronger and stronger would have only have made the threat worse. The previous administration allowed China to build its economy and military while our economy and military became weaker. Now, time is not on China’s side.

        1. The brush of naval carriers this weekend between the US and China in the south China sea looks like posturing and saber rattling. One mistake away from starting a war.

  8. When a delusional seller pairs with a creepily and overly aggressive real estate agent, you get listing descriptions such as the one below in Denver. It made my stomach churn.

    https://www.zillow.com/homes/for_sale/pmf,pf_pt/13285083_zpid/500000-_price/2083-_mp/39.765649,-104.906323,39.740739,-104.94602_rect/14_zm/?

    “At this price, this home will NOT last long! Seller will likely be accepting an offer this weekend, but seller will review offers as they are received, and will not necessarily wait to respond until the end of the weekend. You better get there while it lasts!”

    Three weeks later and still not under contract. That describes the current Denver market in a nutshell.

    1. I note that the seller and real estate agent freaked out because the listing didn’t attract a bidding war the first weekend, and it made them look bad. What did they do?

      They dropped the price $100 because that is desperate and unethical realtors do to make it look like a new listing.

      1. Yep. Also note that they include basement square footage. The above ground space is a small two bedroom one bath layout with less than 1200 square feet. That is actually fine for me, but I wouldn’t pay more than 350k for it. I don’t think we have had a Norway commenter that I am aware of. I would like to hear what is going on over there.

          1. 200 square feet??? I have never seen a condo that small. Newer condos in Downtown Denver are between $500 and $600 per foot. I thought that was insane.

          2. The Norway listing at least looks modern and redone. That CO listing is crazy. I wouldn’t pay more than $200k for it.

    3. Longtime Colorado Springs realtors are openly disdainful of the Denver realtors, who have a particularly unsavory reputation for being slimy and unethical, even by realtor standards, and lying brazenly to both sellers and buyers. A lot of unscrupulous characters who’d flopped at other vocations have reinvented themselves as realtors as the Denver market soared, and the more professional, established realtors in Colorado Springs – who have to be somewhat mindful of their professional reputations – hate dealing with them, due to their incompetence, unprofessionalism, and general sleaziness.

    1. In San Jose back in the early sixties where I grew up several homeowners had family bomb shelters constructed due to the Cuban Missile Crisis. I always wanted to see inside one of them but never did.

    3. I see lots of guns (including OMG ASSAULT rifles) in the pictures.
      I guess if you are super rich gun laws are for the plebes.

    4. Rich love to have servants etc. Turns out many sideline as MS-gang members. It is a middle class society which is great to live in, not a society with a few very rich and the rest peasants.

    5. The irony is that the denizens of the Hamptons are the very people importing the turd world via their endless expression of Globalist sentiments.

  11. More news from Phoenix. Went to a couple open houses in a really popular high end zip code with the wife yesterday. They were recently flipped houses, bought for about $300k and now on the market for about $600k after a few months. They were really nice but no one was there. Multiple houses across the street from each other for sale. Those houses have been sitting for a month. One of the realtors said the neighborhood is a “gold mine” and that “inventory is low”. Both had price drops. What gives??

    On the rental front, almost 90% of new apartments are luxury, LOL. This is Phoenix…

    https://www.azcentral.com/story/money/real-estate/catherine-reagor/2018/10/07/most-new-metro-phoenix-apartments-luxury-requiring-heft-rents-survey-rentcafe-apartmentlist/1501030002/

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