June 25, 2006

It's Sunday - everyone go hit some open houses (you know it's lonely out there)


Oh dear god I wish I was in Phoenix this weekend to run around the new condo developments, submitting low-ball offers of say 60% below asking. Just to see the reaction (and the counter-offer)

Boy, it'd be fun to go to a new housing development in say Queen Creek, or Maricopa, 50 miles out of the city, and ask the builder if they'd be willing to throw in a Prius and free gas for a year to close the deal.

Someone go have some fun and report back. I'm jealous.

I'd bring the realtors milk and cookies though... it's probably been awhile since they last ate

28 comments:

Anonymous said...

Why ask for a Prius? ask for an SUV and free gas. That'll scare them.

Anonymous said...

I went and got a hard sell on what a good deal a home is now that its a buyers market. My reply... you buy it then.

moman said...

Don't make an offer you're not willing to commit to; if you offer 60% below price and the buyer accepts, it becomes a binding contract and if you don't pay, you can be sued for breach of contract.

Johnny said...

Aah, if it is 60% below price, I would definitely buy. I know that a bubble burst is coming, but it is not going to go down below 50%.

Mark in San Diego said...

-San Diego Sign Shakers. . ."Major Price Reduction". . .

At the corner of 6th and F in downtown, two different sign- shakers were steering people to Open Houses with price reductions. . ."now from the Mid 300's". . .these place were selling at mid 400's a year ago. . .another really funny story . . .(I am NOT making these up). . .in the "East Village" of San Diego (read slum) a cop car was out in front of a flea-bag hotel,(lots of guys drinking ripple from paper bags), responding to one crime or another - right across the street is a "luxury condo" sales office with the "customers" taking all this in. Don't think these white-bread suburbanites are going to buy there for ANY price!!!

Mark in San Diego said...

My FAVORITE open House!

Hip Urban Dwelling . . .Reduced price to $895K - was $1,100,000

Link: http://pacificpinnacle.com/newpinnacle/exclusive.htm?link=3

It is the Third one down on their list. . .now this place might command $895K in a decent neighborhood, but. . .would you like a FEDEX 767 300 feet above YOUR condo??? . . .this place is 1/4 mile from the end of the runway at San Diego's Lindberg Field. I first saw this place last August 2006, and thought it might be cheap under the flight path. Then I saw the 1.1 Million price. . .just then an American Airlines 757 came over. Now I love airplanes and used to be a pilot, but even I would have nightmares having these planes 300 feet over my house. Actually, if they put it on the market for $295 I wouldn't live there, but might buy it to rent to deaf people.

Anonymous said...

"Market won't go below 50%".

We don't know that, the 4th quarter recession has not started yet, when companies start announcing major layoffs, we will get a feel of how low the housing market can go.

Anonymous said...

>>I know that a bubble burst is coming, but it is not going to go down below 50%.

Or if it is, at least there will be people worse off than you.

Anonymous said...

With the massive speculatory bubble and its horrid offshoot Real Estate bubble wobbling like 18 year old with crabs, figuring the decline in prices can be fun.

I would argue 40% in the middle.

A 4th quarter recession looks likely and is not properly being prepared for by the government, business or Internationally. Granted, the December layoffs will trickle in the 2007 data and point to what people already know in the street: Things have gone to hell.

crispy&cole said...

ask the builder if they'd be willing to throw in a Prius and free gas for a year to close the deal.
___________________________

Local builder in Bakersfield is "giving" you a MB C230 with a new home purchase - thats a $32k car

uknowwhoiyam said...

Don't make an offer you're not willing to commit to

Good advice, but ...

if you offer 60% below price and the buyer accepts, it becomes a binding contract and if you don't pay, you can be sued for breach of contract.

It's not legally binding until you sign the PSA.

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Los Angeles Friends In Deed said...

uknowwhoiyam said...
It's not legally binding until you sign the PSA.

I believe all real estate contracts for sale must be in writing.

However, be careful about how you make your offer, if it is in an email on a hand written note, that could be argued as a legally binding for a real estate contractual offer. If its just verbal, it would likely being non-binding as a legal contract.

However, even if they accept your offer, you could probably weasel out of it, because most real estate contracts, to my understanding allow for cancelling, based on an appraiser report.

Is that correct?

devestment said...


moman said...
Don't make an offer you're not willing to commit to; if you offer 60% below price and the buyer accepts, it becomes a binding contract and if you don't pay, you can be sued for breach of contract

Verbal contracts are meaningless in real estate, just ask David Learer. Besides, would you take 40% is not an offer, its just a question.
Also, its time to put lots of inspection and approval contingencies into contracts again so its easy to back out after tying up a home for a month or two.

Joe Logic said...

I'm sure there's a correction coming, but if prices really drop 50% or more, I think owning a house would be the least of my worries.

AnonyRuss said...

>>>...most real estate contracts, to my understanding allow for cancelling, based on an appraiser report.

Standard residential RE contracts have an appraisal contigency, other financial contingencies, inspection contingencies, etc. Even in a tight market it is unwise to waive any of them. A 10 or 15 day inspection period should give someone time to look the house over (with professional help - house inspector, a/c guy, etc) and change their mind for mechanical or other reasons. Appraisals have never been a worry for any house that I bought because I never buy unless it is substantially below "retail" prices.

Natural Eyebrows said...

When there are no bidders, the sale price is zero. We've all heard the term "you can't give it away." That's a 100% decline from the asking price. That won't happen with well located properties, but in areas with insane overbuilding, like Queen Creek, AZ, it could.

Builders and their subs will be going broke, construction lenders will be taking over projects, and it will take years to sort out the mechanics liens. I think that qualifies as a 100% decline.

Anonymous said...

50% drop would barely take prices back to 2004. Example of my buddy in old town Scottsdale:

2004 he bought for 154k
2005 comps are 290-400k+
2006 prices are up slightly.

Sales have slowed, but the nice houses are still selling for full price and many listing agents still don't enter them into MLS.

No bust yet.

Anonymous said...

Last Anon
In 2004 you couldn't buy shit in Old Scottsdale. Maybe a dog house or something.

moman said...

Sorry guys, I blew the answer. All real-estate transactions do have to be in writing due to the amount of the contract. Must have had a temporary brain freeze.

Anonymous said...

Free MINI (car) with purchase in Port ST Lucie Tradition!!!

Drove around JAX fla, Beazer had sign-shakers on 8 different corners touting there stick condos!!!!!



bwahahahahahaha

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