Even though all of this was predicted, and is part of the Econ 101 meltdown underway, it's still a bit shocking when you see it in print for the first time. We spoke months ago about the far-flung suburbs of Phoenix being a future ghost town disaster area of empty stucco homes as far as the eye could see, that nobody would want at any price, and, well, that's what we've got.
Here's (yet another) report from housingpanicgroundzero, Phoenix, Arizona, complete with panicked realtors getting together to commiserate and figure out what the heck to tell homeowners that they had just a few months ago told "real estate never goes down"
Slowdown in house sales compels 'brutal honesty'
Real estate agents need to be "brutally honest" with sellers today, as there is about a six-month supply of unsold homes, agents were told at a panel discussion Thursday night.
Many clients are still holding out for last year's prices and not trusting their agents, but agents were advised to teach sellers how competitive the market is and not just tell them what they want to hear.
"You are not going to sell a property at market value. You are not going to sell it for its appraised value," said Paul Pastore of Re/Max Achievers in Chandler. "You are only going to sell it for what someone is willing to pay."
There is an 18-month to two-year supply of unsold homes in Surprise and 2 1/2- to three-year supply in the Johnson Ranch area near Queen Creek, said Russell Shaw of John Hall & Associates in north Phoenix. Homes are taking an average of 77 days to sell in the Phoenix area, he said.
It is common for prices to be reduced several times if a house isn't selling. Pastore said he even quit putting prices on fliers because they are so flexible. Agents talked of houses selling for $50,000, $80,000 or other amounts below appraised values. One agent said she has a home priced $100,000 below appraisal that isn't selling.
Bruce Fraser of Century 21 Metro Alliance in Chandler remembers an Ahwatukee Foothills man who insisted that he be able to set the price and commission and wanted a price in the $500,000s. Fraser recommended a lower price. "The man shook my hand and said, 'OK, it's time for you to leave.'
August 27, 2006
Man, the wicked, shocking, brutal honesty keeps coming: A three-year supply of homes in Queen Creek, Arizona
Posted by blogger at 8/27/2006