Last Week's Biggest Sales

Parkedslope: I agree with you that values are in a state of transition, and that’s why we are seeing reduced transactions, buyer-seller stalemates, and price cuts. Basically, the selling side (including owners, brokers, and perhaps some of the banks? look at the larger bank-balance sheet stalemate nationally) refuse to believe that values have gone down. Buyers, on the other hand, refuse to buy at prices which have skyrocketed in recent years to unsustainable highs. So, we are seeing things like buyers walking away from large deposits since the expectations are that, with values set to go down more than 10%, buyers will still do better cutting these losses and waiting for price declines. And part of the reason that buyers are waiting on the sidelines is precisely because asking prices have not come down enough, since too many sellers/brokers insist that properties are worth more than what buyers want to pay. The only way to break the cycle is for sellers to cut prices, which the most serious sellers are indeed starting to do, sometimes dramatically. Then sales prices start to go down. This in turn, affects comps, which in turn affects “values”. It’s a process, and it does not happen quickly so that’s why individual properties may still recently have been “valued” relatively high (if that value was based on earlier comps, when values were higher).

Lechacal – also, remember that given how slowly RE moves, you have little to lose by waiting. The days of a sudden, brisk run up are probably behind us for years to come, so that is not a risk. In other words, time is on your side. I too am impatient in that I would love to just buy my new place and be done with it, but there is too much at stake financially now to act precipitously and I really am certain that by waiting, we will get a much better deal. Severl properties we were considering months ago have had several price cuts and are already cheaper now than what we had thought would have been a reasonable price months ago. In fact, “reasonable” values are clearly being re-defined, as is clear by all that’s happening in our economy.

Dave, you may well be right. As I posted yesterday I am considering jumping in later this year. But I have a long history of acting on my predictions of market trends a bit too early. Now that the price declines are a reality, I have to counsel myself to continue to be patient.

Oh Sebb – why do you insist on saying I’m losing money? By having sold before the crash, I made more than I would have had I waited. The modest rent I’m paying now is more than offset (including mortgage deduction) by the price declines my previous property has already suffered, and the declines I am seeing on properties we’ve looked at. Please don’t waste time making nonsensical comments.