Is the RE Market Changing?

[Smiling JOe]

Is the Real Estate Market Changing? Good Question. From my daily observation, I noticed from about Feb thru May, I was seeing about 70 new listings each day in Walton Co. This wasn't an average number, but I was litterally seeing about 68-75 new listings everyday. (interesting how the number was so close each day) Much inventory built up. Some properties had listing agreements extended, some people allowed their listings to expire. The net number of properties continued to rise.

Since the beginning of June, I have noticed the number of daily new listings has decreased to about 50 per day. Talking with many Realtors, I understand that most of them are now getting more serious about their listings. They are not accepting any price from the seller. They realize that these overpriced listings are costing the agents money in advertising, when they know they won't sell. I think we are beginning to see some changes of the inventory, in part, due to the listing agents.

I talk to many sellers who tell me that they do not have to sell and are not flexible on price. Some of these "sellers" are receiving low ball offers and they call them "insulting." (I call it an offer.) Bottom line is that the majority of listings are are attached to unmotivated sellers. They just put up a sign and don't see themselves as doing any harm to the R.E. Market in the area.

I think in the immediate future, we will see more Realtors getting closer to realistic prices on listings. In the past, Realtors could put ridiculus, unjustified prices on a listing, and it would sell. The buyers have caused this crazy market, not the sellers nor the Realtors. Today, Realtors must educate their sellers on this market and the basics of Economics 101. I think we will see many of the over-priced listings expire in the future, and not get picked up by another agent, unless it is at a realistic listing price.

In my opinion, at least 85% of today's listings are overpriced. If these listings belong to unmotivated sellers, and they pull them off the market, inventory would decrease so much that we would see sales, and the market will be set. Imagine if the 2500 ish lots for sale in Walton Co decreased to the realistically priced listings totalling only about 375 in number. :scratch: Right now, no buyers seem to know what price is real. Illiminate the unmotivated sellers, and you will see the real price for properties.

Just my $.02


Feed back???

 

[aquaticbiology]

that's what happens when overbuilding occurs!

economics 101 - demand is dynamic, supply is not

but its really all about perception

everybody wanted a piece of the action and they built little drivit boxes to sell at the highest price possible - location, location, location! view, view, view!

the newest solution - convince the buyers that the supply is dynamic, a.k.a. pre-construction sales on a vacant lot with nary a brick laid..., then stop the build and say the supply is drying up!

 

[dsilvar]

Another well spoken dissertation SJ..market mechanics will always rule! Just a matter of time before we reach homeostasis in the realestate market.
Its upwards from there.

 

[Kurt]

I've been hearing similar things from other realtors this year.

Over the last 10 years or so I've heard many instances of an investor buying a property and putting it right back on the market for a "ridiculous" price at a 50-100% increase, and just waiting until the market caught up. The wait varied from a year or more, to hours in some cases after 2000. Sometimes the market caught up and it still didn't sell so they raised prices again and sometimes again, but eventually the property would sell.

Apparently there are still many sellers here who are willing to wait awhile before getting the price they want. Some will adjust down to speed the process but I doubt many will remove their properties from the market, with the mentality of, "you can't catch a fish if your hook isn't in the water". And some will simply have to sell.

 

[redfisher]

I'm a little surprised its taken realtors so long to realize that "unmotivated" sellers are just wasting their time...Now that being said, this is part of the process...Motivated sellers and realtors setting reasonable expectations are exactly what's necessary to set a floor on comps and give buyers an idea where parity is...The sooner you get these junk listings out of the way, the quicker you find buyers and sellers ready to do some business

 

[pgurney]

Somebody asked me the other day, "Do you think $xxx,xxx is a good value for this property?" I responded that I didn't know and I didn't think that anyone knows right now. I wouldn't be a buyer in this market for that exact reason and it may be why there are few buyers right now. I've also heard recently about realtors refusing listings that they think are overpriced. I'm happy to hear it's happening because it's what I think will bring the end-users back to the market. Hopefully, the speculators will stay away (at least en masse).

 

[Smiling JOe]

...

Apparently there are still many sellers here who are willing to wait awhile before getting the price they want. Some will adjust down to speed the process but I doubt many will remove their properties from the market, with the mentality of, "you can't catch a fish if your hook isn't in the water". And some will simply have to sell.

If agents do not accept the listings at the elevated prices, they will have to find another way -For Sale By Owner.

I have a lot listed right now priced at $159K. The adjacent lot, similar in most every way is For Sale by Owner - $325K. Go figure. Price for FSBO is marked on sign and mine is on a flyer sheet at property. Spoke with the seller of the FSBO the other day and he said he didn't have to sell. My question is, "what the heck is he thinking?" I spoke at length with him about his overpriced properties, another which is just down the street. I still don't think he gets it.

 

[redfisher]

I think they do it to make themselves feel better about inaction... As if they're taking some sort of action (not just sittin around on their hands) when in reality they're are doing more harm than good...

 

[goofer]

I think we really began to see this process start with st. joe's pricing of watersound north. they have priced it very realistically and this should create actual sales which will guage what the market values truly are. i agree that realtors need to filter out the unrealistic sellers so that the market reflects the true picture.

 

[DBOldford]

From my limited knowledge of real estate dynamics and as a property owner, I agree with the points on this post. The overpriced properties languish on the market and have to be confusing to potential buyers. As long as there is this much inventory on the market and so few potential buyers, there will not be an upswing in activity. Everyone is waiting to see where the ball will bounce from. As I have said before, I think what this market needs is a summer without so many storms as last year, a culling-out of the P.T. Barnum listings, and a resulting more reliable basis for credible appraisal. Just because many of these properties are cash sales does not mean that savvy buyers are not looking at appraised value.

Pigs get fat...hogs get slaughtered.