Real Estate - what should we do?

[cj]

We went out on a limb 2 months ago and bought a smaller place before selling our existing house. The media keeps pointing out how bad the market is (and going lower). I wish they would shut up already!!

In the meantime, are there any realtors out there? What should we do?

We had a market analysis done. Our realtor suggested we price between $450-475K. We had an appraisal done, and it came in at $465K. A very similar home (size, age, acreage) sold last month for $485K. So we priced ours at $450K. After 5 weeks, we haven't had a single showing. We have a log home in excellent condition, with a good location, on 4 acres. Everyone who sees it says it's beautiful. We are in Maryland near Baltimore.

We are ready to drop the price, not afraid to do that. Should we drop it now, or wait until after the New Year? Or both? Financially we are not desperate or anything, and we can afford to let it ride for a while, but for convenience, we'd just like to move it. We just don't know if dropping the price now would do much good, since we assume that there are not a lot of lookers with the holidays coming up.

Any experts out there? Opinions?

Thanks!
CJ

 

[JDARNELL]

Not a realtor but the spouse is. I can't tell you anything about your market but I can share what I am seeing with her. The last 4 weeks she has noticed an increase in showings on properties she has listed. She also has 2 buyers and 1 seller that just went under contract for year end closings within the last 2 weeks. It seems they are trying to be in before the start of the new year. She expects traffic to slow down the closer we get to the holidays because everyone will be focused on that.

From what you say you appear to be at or under market already. But no traffic? Would lowering the listing price mean you were going to take less than you already plan or is it just taking out some of your negotiating room?

For her clients that are close to break even, cant afford to lower their price, and supporting 2 houses back in the fall she began recommending they find renters in the near turn to wait for a little recovery and also the Spring season. We definately see lesser mobility during the school year.

I guess you could go either way lowering it now or later if you plan to do it. It might bring in some buyers before the holidays. I think you are also suffering from the time of the year in addition to the broader happenings in the housing market.

Tomcat98

 

[tryan]

5 weeks is a long time not to have a single showing ... has to be the price.

 

[honobob]

What's your realtor say? Are you listed with a cut-rate agency? I've just put a bid on a property listed with a cheapo real estate company. I contacted an agent from that company several months ago and said I was interested in several properties including the one listed by his company. He did everything he could to direct me to other properties where he would get a much bigger commission. After a month of this I got rid of him. The property was still on the market over Thanksgiving which is about the worst time to have a home on the market. I tried to get a new agent at the company and finally succeeded after several attempts!! You sure get what you pay for. I was told that the last showing for the property was several weeks ago.

So I would say if that's not the problem then it's probably just the time of year or possibly the fact that it is a LOG home and the market for them is smaller. Unless you have fall color now your property is probably showing at its worst with grey skies.

Would you be happier if you had people (lookyloos) tracking through your house every day? Then you'd be stressing about why you didn't have an offer. You only need one buyer. I would wait until after the Holidays and depending on feedback from your Realtor offer an extra 1% to the selling agent.

 

[cj]

Thanks for the feedback, all. We have worked with this realtor before, and I think she's fine - she just says that there are not that many buyers out there. I have a call in for her this morning to get her opinion about the price adjustment. And yes, it's a bad time of the year, and you are right about the market for log homes being smaller. Honobob - my attitude has been pretty much what you are saying - it only takes one. A friend suggested we have a open house, and we are NOT going to have one, for just the reason you stated - we'd have everyone in town traipsing through just to get a look at the inside!

It's been in the back of our minds all along that we may have to wait until the spring, and I guess we just have to be patient!

CJ

 

[tryan]

He did everything he could to direct me to other properties where he would get a much bigger commission.

I hate when they do that ... show you everything "in-house" and NOT the 1 or 2 you're interested in. Explains why the last 3 purchases were found online by DW and I ... no help from any realtors.

 

[honobob]

It's been in the back of our minds all along that we may have to wait until the spring, and I guess we just have to be patient!

CJ

My experience in the midwest was that all that "spring" activity was actually the result of showings done during the first decent weather after new years so you might want to be prepared with your game plan.!

 

[ChrisC]

I have a real estate license but I'm not competent to advise you about your local market. When you say a similar home sold, was it also a log home, which as mentioned is a narrow market?

Look, the holidays are approaching, you've had the place listed for 5 weeks with no traffic, and you're not financially strapped or motivated to sell at rock-bottom prices. So, why not take it off the market and re-list the house at the end of January unless the winter climate would make the house difficult to show, in which case wait until early Spring?

The local market in the outer-suburbs of DC has really tanked, big time. Credit is more difficult to get especially for jumbo/nonconflrming loans, buyers aren't jumping up and down -- though there are a lot of bottom fishers "looking around," and the average days on market has expanded in Baltimore County to 90 days in October 2007 (from 60 days in October 2006). We're all in for some difficult times regarding housing sales.

Good luck.

 

[cute fuzzy bunny]

Specialty home, bad time of year to sell, bad market to sell in, buyers are sitting on their hands waiting for the bottom, all the buying is happening with people who HAD to sell and move and there are probably few of those looking for a specialty property.

I dont know your market value but I dont think price is your problem. You can certainly make it a solution by so vastly underpricing your property that an investor/buyer will take it because its absurdly cheap.

Have you checked your zillow value? Have you "listed" your home on zillow and uploaded photos to increase the eyeballs on the property? Have you checked realtor.com to make sure the home is visible in the MLS? Are there photos? A virtual tour? Is the description good? In some areas the MLS database is broken up into smaller databases and if your home isnt listed in all of them, a realtor has to search more than one to find your home. Theres a lot of property for sale, so an agent might not go through the trouble when a local search turns up 450 results. It costs a little extra to list a home in each MLS database, and if your agent isnt a member of that "board" they might have to pay a fee and fill out forms to get on board. For example, when I was selling my house, the MLS listing was local for that county. But most of the buyers came from the metropolitan area 35 miles away. If I hadnt listed in BOTH MLS databases, I would have missed a big chunk of potential buyers.

For a log home on some property, it might also be worthwhile to advertise in publications or through a service that specializes in those sorts of properties. If you were a buyer looking for such a home, are there any agents, services, magazines or newspapers that specialize in 'country living' or specialized properties? Here in the west we have Sunset Magazine, which has a specialty RE section full of log homes/green homes. Not sure if they ever sell anything through it.

 

[lazygood4nothinbum]

luck rules times like these. i'm not sure it matters much what you do. i started inherited house off where the "experts" told me to be late last january and since have dropped the price by $350k. i'm currently one of the cheapest deepwater properties locally available yet in one of the very best areas. in my immediate area i have undercut by $150k the next house which has less seawall and less square footage and i am $350k under the next house above that. i have even undercut houses in less desirable (but still very nice) areas. we get lookers but not a single offer.

i am within the zillow range but not at its price which is a joke considering comparables. it shows an identical property two houses down at $350k greater than mine and a lesser property at $200k greater than mine. zillow also fails in consideration of my personal home which it lists $200k less than my neighbor who hasn't updated her house since the 1950s (seriously, not even central air in florida) and has less square footage. so i have no idea how zillow figures. it shows one house near me at $444k which is currently asking $375. so zillow should only be taken cum grano salis.

our next step might be to consider selling by owner and reducing the price again by what the realtor would have made. maybe there is a buy by owner market that we are not tapping with the realtor. or maybe our luck will just change.

 

[cj]

I have a real estate license but I'm not competent to advise you about your local market. When you say a similar home sold, was it also a log home, which as mentioned is a narrow market?

Yes, also a log home - similar style, size, age, within 4 miles of here, same amount of property.

I'm not sure how much I trust Zillow - from what I have seen it is usually in the ballpark, but I have seen some wild prices out there.

Anyway, thanks all for the input!

CJ

 

[FinanceDude]

I think it's a measure of price, and also it being a "non-traditional" structure.

Not everybody wants to live in a log house, but would if the "price was right"............even me........

There's a house in my neighborhood that's close to being foreclosed on, and I am looking at it. It was assessed at $350,000, and the market analysis has it at $375,000. My real estate guru buddy says I should offer $300,000 if I am serious...........problem is, what if it doesn't sell for a year??

 

[W2R]

It's awful, but a lot of people won't buy a home unless they think it would be easy to sell. I wouldn't buy a log home, or one with unusual architecture for the neighborhood, or one with fewer than 3 bedrooms or 2 baths, or one on a busy street, and so on, even though none of those really would matter to me while I lived there.

The bargains available in homes are just absolutely spectacular. I am dying to buy a home in my future retirement town, and I saw some that were "to die for" up there last week. I could afford to buy one, but I really should wait until I can retire in two years and then until my present home has sold. That would be more sensible. Otherwise I'll get stuck with homes in two places and more long distance maintenance hassle than I care for. But gee, what a buyers' market.

 

[Peaceful_Warrior]

I have a property in CA that I want to sell. We move to the PNW and decided to rent out our old home.

I touch bases with my realtor every few months to try and gauge whether it is time to sell or not. *Very* recently he told me that this time of year is very bad for selling usually, and that he would have a much better idea after the New Year.

Also, just because it is "fairly" priced, doesn't mean it will sell with this market. I think it's better to go low and potentially get multiple offers (or even just one that's acceptable), than to have it sit longer and longer.

Make sure you're offering the full 3% commission to the buyer's agent.

When you do the next price drop, make sure your realtor does an MLS 'refresh' (delete old listing, add new listing). Many realtors don't like to do this because it costs them each time (it cost my realtor $100 each time he did this), but it's invaluable because it shows up as a 'new listing' in MLS.

Of course it's also important that if asked, you and your realtor are honest about how long it's been on the market. However, in some areas this 'refresh' is considered common practice as a way to notify other realtors that the price has dropped (so no ethical issues, although it may sound like that on the surface).

 

[cj]

The bargains available in homes are just absolutely spectacular.

I was watching Dave Ramsey the other night and someone asked him, "with this real estate market should I be renting?" And Dave said something like, "Hello!?!?!? You are in K-Mart. The BLUE LIGHT IS ON!"

So buyer's market - absolutely! We got an amazing deal on the smaller house we bought... (That's the good news.)

CJ

 

[cute fuzzy bunny]

This is probably a good time to offer more than 3% to the buyers agent. 3.5-4% might spur some showings.

 

[dex]

5 weeks is not that long of a time. You might want to consider that this time of the year is not a great for selling - holidays and all. Maybe take it off the market and put it back on in March. One thing people ask when buying is: How long has it been on the market. The longer on the market then it appears you are a distressed seller.

 

[ChrisC]

When you do the next price drop, make sure your realtor does an MLS 'refresh' (delete old listing, add new listing). Many realtors don't like to do this because it costs them each time (it cost my realtor $100 each time he did this), but it's invaluable because it shows up as a 'new listing' in MLS.

Of course it's also important that if asked, you and your realtor are honest about how long it's been on the market. However, in some areas this 'refresh' is considered common practice as a way to notify other realtors that the price has dropped (so no ethical issues, although it may sound like that on the surface).

MLS doesn't work that way in the DC-Baltimore area. First of all, the MLS (it's called MRIS in this area) contains a record of expired or withdrawn listings -- the old listing is never deleted. Secondly, if you re-list within a year, the new listing will still carry the critical "days-on-market" figure for the old listing in many cases.

I wouldn't worry about days on market figures for listings in this market as the market has really tanked. But if the poster is very concerned about this figure, his realtor can "temporarily withdraw" the listing -- it will be noted that way in MRIS and no one will show the house in that status, but it has the benefit of indicating to agents that the house will come back to "active" status. It's perfectly acceptable for him to do this in light of the holidays.

 

[Martha]

We are having difficulty selling our place, after two initial sales fell through. Our market really dies in the winter. Combine that with the fact that the market in most places is in tough shape, we took our place off the market for the winter.

Our agent says that the spring selling season starts in February. That was a surprise to me, given that it can be 40 below zero in February here and it is hardly spring like. But she said that people start looking then, with the idea that they can be in the place by the time "real spring" hits.

 

[Moemg]

My sister built a new house while trying to sell her house .Well her house did not sell and now she is stuck with two exoensive houses and had to (YUCK ) return to work at 63 .

 

[lazygood4nothinbum]

i agree with not worrying about days on market today. in our market there will be very few houses that will not be listed at least a year. can't find it now but i recently read somewhere that 400 to 450 days is the new average.

those of us trying to sell in florida are hoping against odds that the electorate will vote for portability of our "save our homes" values whereby a seller of one house can bring their homesteaded tax savings to their new purchase. chances are not great because state constitutional amendments here require at least a 60% majority vote. if it passes the legislature could enact by november 2008 and i believe the transference will have a two-year window from the sale of the original homestead.

this would at least free up current residents from feeling trapped in their existing houses and add them to the buyer pool. also we are hoping that while the value of properties and the dollar decrease that overseas investing will look better here as florida has always been a good magnet for that.

it is a shame that our elected officials did not make better provision for 2nd home buyers and owners of commercial properties and especially a shame that our so-called representatives are so comfortable in the pockets of the insurance companies because taxes and insurance continue to drag housing prices.

 

[lazygood4nothinbum]

correction: seems there is some protection for 2nd home owners & commercial properties...

Property tax portability rewards longtime residents -- South Florida Sun-Sentinel.com

and cap taxes for businesses and second-home owners.

which i now recall but i'm not sure i recall the cap as being significant.

portability sure would be good to me. i could sell here, buy myself a 2/2 condo, pay zero taxes and get a cute but quiet roommate to cover maintenance & insurance, bringing my housing costs here down to about nothing. guess it could just be a place to park some cash, the car, to park some future homesteaded value if i ever want it and then take off for thailand. sweet.

 

[chinaco]

We are ready to drop the price, not afraid to do that. Should we drop it now, or wait until after the New Year? Or both? Financially we are not desperate or anything, and we can afford to let it ride for a while, but for convenience, we'd just like to move it. We just don't know if dropping the price now would do much good, since we assume that there are not a lot of lookers with the holidays coming up.
...

I am not an expert. But I think there may be a bit more at work than just the housing market. There is some fear of recession. People tend to tighten the belt when uncertainty hits. I also agree with the comment about the time of year... Winter is probably a bad time of year to try to sell.

Hopefully you are close by the old homestead so you can keep an eye on it.

 

[SteveR]

Winter house markets tend to be smaller both from the seller and buyer perspective. Those buyers tend to be less "lookie lookies" since they are cash poor this time of year and have better things to do than trot from house to house with a realtor. There tends to be fewer houses on the market because prospective sellers are waiting for Spring...along with many many other prospective sellers which then jacks up the Spring inventory of homes and deflates values due to excess inventory.

Winter buyers tend to be more serious about looking and buying. Many are transferees rather than the usual "trade up" buyer. Most relocation packages force a home sale in 90 days so the buyer is in a hurry to get a new house in the new location.

So, I believe Winter to be a good time to market a home...less competition and buyers willing to buy. The downside is January which tends to be a very slow month.

We are getting our house ready for sale and plan to put it on the market in February. We want to get past the January lag period and get an early start on the Spring buyers. Our house tends to show better in Spring due to the yard features so waiting for the February thaw seems prudent to us. Besides, it gives us more time to declutter the place.

We sold our cabin this past April after having it listed all winter. We had folks going through it despite several feet of snow and near zero temperatures. We had little competition and I believe that helped sell it..for full asking price. It was a 2/2 on 5 acres in the mountains. Cedar exterior and metal roof.

All it takes is one buyer...you just have to find them.

 

[TargaDave]

After 13 years in one spot we're putting our place on the market around Feb as well (one year ahead of the plan). Guess our FIRE related move just didn't quite coinside with the RE market cycle but I suppose it all sort of balances out in the end. Be interesting to see how everyone makes out though. Good luck cj

Looking forward to training a 9 and 17 yr old in keeping their rooms (and bathroom) showable for more than 2 hours at a time