"Buyers think, 'Why should I buy today? It will be less expensive in a month or three weeks.' Every listing agent I talk to is getting ridiculous lowball offers," said Diane Watson, a Realty Executives agent in north Scottsdale.
OK, Miss Watson, here's some thoughts
1) Uh, no, those are serious, credible offers, at offer prices that your sellers might see as lucky to get one day
2) You must present every offer to your seller, regardless of whether you think it's "ridiculous". I realize your profession is essentially corrupt, and you will earn less commission as prices fall, but it is what it is.
3) What are you telling your sellers? To hold out for better offers? Not a good idea at this point. It's panic time in Phoenix
4) The buyers are right - houses will be cheaper a week from now, and a month from now, and heck, a year from now. Thus the legitimate low-ball offers. Take 'em. You'll be lucky you did.
And for HP readers - how much of a lowball offer would you recommend putting in right now vs. asking in Phoenix?
10% below?
20% below?
30% below
50% below?
No offer is low enough?
May 14, 2006
Let's dissect this brilliant realtor quote from the story in the post below
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19 comments:
I *might* consider owning a home in Phoenix - providing the seller paid me enough money :)
Nah. I'd pay about what I'd pay for a similar house in El Centro. Same damn weather and vegetation.
I think 40% off might get some bites.
only problem though is that a year from now, you'd be upside down at that price
I was in Laguna Beach yesterday and saw "reduced" signs. Where would you rater live?
at least 30-50% lower.
Just think for a moment. How outrageous the price is..And where they were in 2001.
Thumb rule: Add ~4%/yr increase to 2001 price to arrive at your bid price.
If prices manage to drop 30-40% in Phoenix, it will take several years to do it, at least 4-5 years to feel the full effect. Investors need to sell right away. People who want to move up in the city may either sit tight or take a 10-20% shave if they are truly motivated. It's basically a long, slow standoff between buyers and sellers.
"75% off current prices minimum!!!! Since bubble cities may in 10 years be 90% lower than todays prices, this will provide some cushion."
To the person who said this, please put down the crack pipe and come back with the rest of us.
In Miami but here is something to think about.
I just got a knock on my door...turns out my landlord is in default. No big deal since I am moving at the end of the month BUT he still has my deposit of 1800.
If he can't pay his mortgage, chances are he can't pay me back.
Obviously I am going to discuss it with him, and sue if necessary. However if he is already in default what good would it do to attach a lien to a property in Foreclosure?
Any advice would be appreciated.
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That sucks. Rule of thumb. Don't pay your last month rent if you have any problems with a landlord. He already has that months rent.
In Miami but here is something to think about.
I just got a knock on my door...
If he can't pay his mortgage...
Obviously I am going to...
Any advice would be appreciated.
I work in property management in Florida. Apartments and condos built in the 70's & 80's. At our company we always pay back deposits unless the tenant skips or destroys the property. The reason is that in Florida the loser in small claims court pays all court fees and the landlord almost always loses. I've seen landlords go down for several thousand dollars for withholding one or two hundred dollars of a security deposit.
1. Get a lawyer.
2. Sue in small claims.
3. Win (because he doesn't have a case if he doesn't pay you).
4. He pays you or you put a lien against the property which you can do.
I rent right now since prices are so rediculous in my area. If my landlord doesn't give me 100% of my deposit, I'm doing exactly what I wrote above.
Veritas:
Start building your case now.
1. Make sure you have a copy of your lease.
2. Return the keys according to the lease term. Don't just leave them on the kitchen counter.
3. Take pictures of the entire premises after you have cleaned out. Use a digital camera. Don't use a video cam. Thatt's hokey. Your photographing inanimate things, not taking action shots.
4. Tell your LL in writing that you want to do a walk-through with him at move-out.
5. Make a written demand for return of your deposit. By certified mail.
6. Make sure LL has your new address.
Good luck.
about the deposit
Find out if your state is single-party-consent phone recording and if it's legal for you, record all your conversations with the landlord without him knowing.
THEN take him to small claims court.
Love to hear some verifiable stories of people getting homes in once hot markets at a massive discount. The best gauge for value would probably be median $/finished SQFT in the same neighborhood, for a similar house last year compared to the house you just bought.
Go ahead, show me the big 50-75% discounts. Anybody getting their lowball offers accepted?
p.s. Funnominal, you're racking up some pretty wicked karma there. Planning in advance to scam your LL out of 4 months rent and threatening to snitch on him to the IRS is pretty awful. You're the reason I warn clients about the perils of being a LL. Yikes!
Well Osman, I've been on the receiving end of not getting my deposits back.
I've moved into shitholes that need decorating throughout, and the landlord wants it decorating before I move out or no deposit. I've even had one saying that my deposit was non refundable as it was to cover wear & tear.
Now I just withold rent to the value of, not a penny more or a penny less.
Energy getting more expensive. Water dependant on the weather which is in a state of change (global warming or cyclical - doesn't matter), jobs going down the tubes, crime, gangs, unhappy illegal Mexicans... Why would anyone buy there?
Around here $200K still buys a nice house in a good economy with decent weather.
Osman,
You must have missed the HP post from the former bank guy who explained that during the last real estate downturn, he was selling REO propeties (meaning Real Estate Owned by the bank after foreclosures) for 20-30% of appraisal value. Because of creative financing, this housing crash will produce WAY more of these properties than last time.
SO, people will not get 70% of street prices (mainy because the sellers cannot afford to take this type of a loss), but there will be serious bargains to be had.
I do find it amusing how realtors word their advertisments. It's rarely "priced reduced" but "price adjustment". Like they can't even bear the thought of admitting it was overpriced to begin with! *L* Realtors are in the same league as used car salesmen.
My brother knows a guy who is good friends with a realtor. This realtor presently has $200K in the bank, married with kids and is RENTING. Even the realtor won't buy in this market, though he could afford to.
Very pretty design! Keep up the good work. Thanks.
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What a great site, how do you build such a cool site, its excellent.
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As far as getting lowball offers accept, when we bought our first house in 1991 in the Philly suburbs [just after the previous peak int he market] , they were asking $190,000. We offered $140,000 and they were insulted. They called us back 2 weeks later and said they would accept $150,000. We settled on $145,500. So that was a 24% off - offer accepted. I think the upcoming market will allow for even larger lowbal ofers.
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