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Sellers Are Going To Have Trouble Getting The Prices

A press release from Redfin. “Signs continue to point toward a changing market that’s letting homebuyers be more selective as supply constraints begin to ease in the hottest markets, according to Redfin. As a result, sellers are feeling compelled to adjust their expectations — and their prices. In the four weeks ending on September 16, 26.6 percent of homes listed for sale had a price drop, the highest level on record since Redfin began tracking this metric in 2010. We define a price drop as a listing price reduction of more than 1 percent and less than 50 percent.”

“‘There are some early signs of a softening market, and the increase in price drops may be another indicator that sellers are going to have trouble getting the prices, and the bidding wars, that they may have just months ago. Instead, many are finding their homes are sitting on the market without much interest until they start reducing their prices,’ said Taylor Marr, Redfin senior economist.”

“Las Vegas (+12.3 points to 28.1%), San Jose (+10.7 pts to 25.7%), Seattle (+10.1 pts to 37.1%), and Atlanta (+9.0 pts to 27.9%) were among the markets that posted the biggest year-over-year increases in the share of homes with price drops.”

“‘In a market where we’re seeing more inventory, sellers may choose to use price reductions to continue to generate interest in their home for sale,’ said Jessie Culbert, a Redfin agent who works with sellers in Seattle.”

This Post Has 29 Comments
  1. ‘26.6 percent of homes listed for sale had a price drop, the highest level on record since Redfin began tracking this metric in 2010’

    Since 2010? Oh dear…

    ‘Las Vegas (+12.3 points to 28.1%), San Jose (+10.7 pts to 25.7%), Seattle (+10.1 pts to 37.1%), and Atlanta (+9.0 pts to 27.9%) were among the markets that posted the biggest year-over-year increases in the share of homes with price drops’

    And Las Vegas is supposedly the hottest metro in the US right now.

    1. using realtor’s language – if they believe that they are transitioning from a sellers to a buyers market ….

      In the depths of 2009-2011, what was the typical discounts from list price? I am wondering if they will start to play the auto dealer list higher and discount more trick

        1. “A bursting housing bubble?” Suzanne manages a forced laugh past her Botox perma-grin. “Oh, heavens no, this isn’t a bubble, so it can’t possibly be bursting.” Perspiration beads on her upper lip. “This is just a…a seasonal softening! Yeah, that’s it, that’s the ticket.” Her forced laugh carries a note of sick desperation. “Just a slight downtick, that’s all, as prices got a wee bit ahead of themselves, but now they’re consolidating for the next leg up. My research confirms this.” Her facial tic, which has grown more pronounced in recent weeks, begins to twitch. “And my gut feeling, as well as the NAR’s market assessments, indicate’s that there’s never been a better time to buy than right now, especially with all the special listings that are piling up, er, I mean, that are appearing as the acute shortages we told you about earlier are beginning to alleviate somewhat.”

    2. “Seattle (+10.1 pts to 37.1%)”

      Hooboy, that’s massive! Poor ol’ Redmondjp is still pimping house prices over on the Seattle bubble site.

  2. “‘In a market where we’re seeing more inventory, sellers may choose to use price reductions to continue to generate interest in their home for sale,’ said Jessie Culbert, a Redfin agent who works with sellers in Seattle.”

    Or sellers may choose to cling to their greedhead wish price and have their shack sit unsold while the bursting housing bubble gathers force, inventories soar, and prices and sales plummet. It’s all the same to me. Either way, I’m not buying until the cratering has reached its nadir, and that’s a long, long way down.

    1. We’ve all seen this movie before. We’ve all know what is going to happen. I know a former co-worker who rode the market all the way down to the bottom. He wanted top dollars for his place in Maryland but already brought a place in Florida. The house was on the market for 3 years…until sold early 2012 at the bottom. He was always behind the market.

    2. “may choose to use price reductions”

      Love how they make it sound like a creative option rather than what it is: a necessity.

  3. Millions of debt donkeys using their houses as ATMs to pay the bills. What could possibly go wrong?

    https://www.bloombergquint.com/business/2018/09/19/cash-strapped-americans-are-leveraging-their-homes-to-pay-the-bills#gs.V02NQ3Q

    (Bloomberg) — As U.S. household debt rises and wages stagnate, millions of Americans are thinking about tapping into home equity to keep up with day-to-day expenses.

    Twenty-four million homeowners believe borrowing against home equity is an acceptable way to cover regular bills, according to a Bankrate.com report released on Wednesday. Cash-strapped millennials, low earners and the less educated were most likely to think home equity offered an appropriate solution to ordinary bills.

    “Regular household bills should be funded by a regular household income, not home equity,” said Greg McBride, chief financial analyst at Bankrate.com. “Wage growth has been elusive, but rising household expenses have not. And now home equity is being seen as a lifeline for those who are strapped for money with little wiggle room.”

    1. With 10 calls per week from mortgage refi debt pimps who promise me to throw me a “free” $200K to refi at nearly 5%, how can I resist?

      You have to understand that my first house had a loan at 12%

      My parents had a 6% loan on their house and I was extremely jealous at the time. They were making 9% in their bank account.
      I’d like to be them again with my 3.25% mortgage.

      Seen this all before.

      1. Bigger breasts are the last thing I need around here. I’m not bragging.

        However, when someone offers you “free” money, the temptation is great. ie the 80’s kitchen must go, the car is 12 years old, the kids need new laptops, that 30 inch TV is too small, and on and on…..

  4. Household net worth climbs to $2.19 billion on the Fed’s housing and stock market bubbles. How is it that the Fed pumped $15 trillion in printing press “stimulus” into financial system, and yet total household worth – even accounting for fictitious bubble valuations, and of course discounting the tripling of household debt – is only a fraction of that?

    https://www.marketwatch.com/story/household-net-worth-climbs-by-219-trillion-driven-by-stock-market-house-prices-2018-09-20

    1. …. which requires more defective(fraudulent) appraisals.

      As we all know…. Houses are depreciating assets. Their dollar value goes down, not up.

  5. I got asked this elsewhere:

    ‘is there a way to avoid typing in my name & email every time I post?’

    If anyone isn’t experiencing this please let me know with device and browser info.

    Here’s what it looks like: autocomplete is something your browser does. But some WordPress developers so dislike repeat comments they have blocked it in the code! Apparently I can’t turn it off. So I will ask the technical guy to look at it once we’ve gotten other fires put out.

    Again, if anyone has autocomplete working for them, please let me know.

    1. My Web browser (Firefox) has a history of my name so I just have to click on the field and select to fill it in.

      Also a suggestion. You should try to link your main page to the current date posts.

      ie if I enter:
      http://housingbubble.blog

      I see the 9/18/2018 posts.

      It should be updated to point to the current date posts located here:
      http://housingbubble.blog/2018/09/20/

      The archive calendar at the bottom of the page is a nice feature and allows you to browse back in dates.

        1. Thank you Ben.
          I refreshed the cache and all is working well now.
          It was my problem and it is fixed.

  6. Ben, I think it is not good that new blog posts are known only by name only, as exemplified by

    http://housingbubble.blog/sellers-are-going-to-have-trouble-getting-the-prices/

    and not by a sequential serial number such as in the old blog:

    http://thehousingbubbleblog.com/?p=10636

    This is going to be an endless source of trouble when trying to find old threads or referring to old threads, At the very least I think a scheme of the sort

    http://housingbubble.blog/YYYY-MM-DD/name-of-thread

    or even better

    http://housingbubble.blog/YYYY-MM-DD/SERIALNUMBER/nameofthread

    will very soon become a necessity. My comment is in the interest of preserving the history and value of each post and comments, which I think is an important function of the blog.

  7. Starting to lap the credit qualification changes of DTI from 44% to 50%, that were implemented last July. It’s now more apples to apples comparison.

    What do you know – existing homes sales are down -2.7% vs. year ago.

    Pricing won’t be apples to apples comparisons until at least January when we start lapping the loan limit increases.

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