Is the realestate bubble bursting?

[REWahoo]

Things have definitely slowed here in my zip. Over the past few years there have consistently been 8 -14 single family homes for sale on Realtor.com and typically two or three of those showed "pending". The number of listings is slowly creeping up, currently at 19, and only one of those is pending.

 

[braumeister]

Things have definitely slowed here in my zip.

Still hot here. My neighbor across the street listed his last month and had two firm offers the same day for $15K above his asking price.

But the flip side of that is that his sole motivation for selling was that he thought the market was at its peak. The only acceptable place he could find to move to was a condo half the size and monthly dues of considerably more than here. He admitted he probably made a mistake.

 

[2HOTinPHX]

So to add another example of Open Door..... maybe the next Zillow being caught in a slowing market. Looks like they bought this one and are now offering at 10K less than they bought it for just two months later. Not a good sign.

https://www.redfin.com/AZ/Phoenix/1...ent=link&2010988919=variant&813945303=variant

Yikes the price on the condo was just dropped by another 30k. That's not a good sign.

Also the number of listings for sale seems to be rapidly increasing. From below article "were coming in to balance" which is probably a good thing for home buyers. The market has been crazy.
Arizona's Family: Real estate listings double in Phoenix area.
https://www.azfamily.com/2022/07/28/real-estate-listings-double-phoenix-area/

 

[2HOTinPHX]

Yikes the price on the condo was just dropped by another 30k. That's not a good sign.

Also the number of listings for sale seems to be rapidly increasing. From below article "were coming in to balance" which is probably a good thing for home buyers. The market has been crazy.
Arizona's Family: Real estate listings double in Phoenix area.
https://www.azfamily.com/2022/07/28/real-estate-listings-double-phoenix-area/

Wow I am just randomly looking at properties in the Phoenix area and came across another Open Door listing that is now listed for 30k less then it looks like they purchased it for.

https://www.redfin.com/AZ/Buckeye/2...ent=link&2010988919=variant&813945303=variant

 

[Another Reader]

Wow I am just randomly looking at properties in the Phoenix area and came across another Open Door listing that is now listed for 30k less then it looks like they purchased it for.

https://www.redfin.com/AZ/Buckeye/2...ent=link&2010988919=variant&813945303=variant

The Open Door stated purchase price is the price before deductions for repairs and fees, which are often 10 percent of the price. So a purchase price of $650,000 is more like $585,000. They will then list the house at something like $675,000 after doing very little except cleaning and maybe painting. Knocking $30,000 off the list price and paying a cooperating broker is still "profitable."

 

[2HOTinPHX]

The Open Door stated purchase price is the price before deductions for repairs and fees, which are often 10 percent of the price. So a purchase price of $650,000 is more like $585,000. They will then list the house at something like $675,000 after doing very little except cleaning and maybe painting. Knocking $30,000 off the list price and paying a cooperating broker is still "profitable."

Ahhh thanks
...I did not know it was showing the numbers that way....kinda sneaky... LOL...or not I guess they all list the sale price before transaction cost.

 

[Teacher Terry]

Prices are coming down in Reno but the last few years the increases have been ridiculous.

 

[FlaGator]

Interesting specific situation with Open Door. I had no idea how they operate.
Final sales price and time on market will be a useful indicator.

In the meantime, I got a mailer from a local agent last week. While they believe the market is "still active and favorable for sellers"...., "with rising interest rates and economic concerns, we expect *continued* price reductions and additional inventory..."(emphasis mine).

When agents tell you the bloom is off the rose, that bloom is already mulch.

I don't have a solid belief about the degree of decline, how quickly it will happen nor how long we stay at the bottom.

Wherever we end up, the process has started in my area.

 

[2HOTinPHX]

[QUOTE

When agents tell you the bloom is off the rose, that bloom is already mulch.[/QUOTE]

Yeah that's a sign for sure..I remember back in 2007 when we were preparing to make a full price offer on our current home our agent suggested to offer 25K less. We were like what.....offer less.. never heard of such a thing....they accepted the offer and you all know what happened from there.....took a long time to come back to break even but live and learn... what goes up sometimes comes down...

 

[jkern]

The thing that might keep the real estate market up, at least for homes that are in a lower value market, is the huge cost right now to build a new house.

Or at least a quality new house. If you use name brand windows, shingles, etc., it is like impossible to build a $300,000 house nowadays.

In CA government fees and mandates might cost nearly $300,000. Just kidding, sort of. I don't know what they are, but I'm sure they are high.

 

[retire202052]

Wow I am just randomly looking at properties in the Phoenix area and came across another Open Door listing that is now listed for 30k less then it looks like they purchased it for.

https://www.redfin.com/AZ/Buckeye/2...ent=link&2010988919=variant&813945303=variant

Yes....in our case Opendoor "bought" our house at $406,000......but after fees, etc.....gave us $374,000.....and honestly could get this house sale ready for like $2000. So they could say price dropped 25K from sale price and still make a quick profit.

Plus, there is something with the loans they get that they can't lose....need to research that more.

 

[eytonxav]

We are in a very unusual situation where we might need to sell our house quickly. Received a letter from Opendoor last week with their estimated offer between $625,000 - $764,000. Our house is in good shape, but it has a good deal of clutter and we have dog and cat, so getting it ready to show would take quite a while and showing would be a hassle, so not the best route in our predicament. I understand that Opendoor also has an option where they provide $s so you can buy another home to speed up the moving process. Might investigate this further, and as I understand it you have no obligation to accept any subsequent adjusted offer after they inspect.

 

[Katsmeow]

We are in a very unusual situation where we might need to sell our house quickly. Received a letter from Opendoor last week with their estimated offer between $625,000 - $764,000. Our house is in good shape, but it has a good deal of clutter and we have dog and cat, so getting it ready to show would take quite a while and showing would be a hassle, so not the best route in our predicament. I understand that Opendoor also has an option where they provide $s so you can buy another home to speed up the moving process. Might investigate this further, and as I understand it you have no obligation to accept any subsequent adjusted offer after they inspect.

You do not have to accept their offer after they inspect from what I understand. Some people indicated that they do usually drop it some during that. I don't see a reason not to get a quote from them. There are other similar places to Opendoor. One of the ones I've seen in this area is Offerpad. I also think Redfin has a similar option. So if you get quotes, get quotes from all of them.

Right now, most houses are not selling that quickly if you want a quick sale. In the little suburb where I live about 75% of houses listed in July don't have contracts on them yet. So, for a quick sale without a lot of hassle I think one of those options might be OK if they offer a reasonable price. The market is overall not bad but slower than it was. Talk to a regular real estate agent about how long they think it might take to sell your house and price. If they give comps based upon sales that closed in the last few months, bear in mind that prices are reducing somewhat and it is starting to be the fall so those comps may over value your house.

 

[skyking1]

Apples and Oranges comparison, but we got the highest offer yet for our beach lot. It's the first one that is more than we paid for it, and only short of the value by half

 

[RobbieB]

The house across the street has been up for over 3 weeks now. Not a lot of traffic and the flag on the "for sale" sign post has lost a screw and has been hanging lopsided for 2 weeks now.

Yeah, not a lot of interest it would seem. Would have been sold this time last year.

 

[kgtest]

We had a couple price drops in our neighborhood on already overpriced list. Local paper mentioned the market is cooling with 10% of the lists reducing prices. Still a seller's market, but top dollar came and went back in April and May, with June cooling a little.

Sold my late sister's townhome for list price...the month before probably would have got above list. Listing another townhome end of this month. I'll check back. We are listing higher than all comps, and will adjust down if needed.

 

[ownyourfuture]

100%. You can't keep the Fed funds interest rate at near zero percent for twelve years and purchase almost $3 Trillion in mortgage backed securities and expect to have a sane market.

A+

 

[teejayevans]

When I look at Zillow and see a house I like, it sells within a week. The cookie cutter homes not so much lately.

 

[Badger]

No bubbles bursting here.
The house (like my 1955 1500sq ft concrete block house) across the street sold for $416k in 9/2009 and was promptly torn down.
In 11/2013 a new 5223 sq ft house was built on the lot. It quickly sold for $1.55 million. It was then put up for sale on 5/27/2022 for $3.75 million then 2 days later it sold for $4 million.
There are 26 houses on my block and all but 2 have been torn down since 2006 and rebuilt with McMansions and this one that just sold is not the largest.
It appears that all our neighbors are probably at least 8 figure multi-millionaires except for the 2 holdouts and we are retired teachers who couldn't afford buying the houses we presently live in. I'm glad we paid ours off years ago long before we retired.

Cheers!

 

[Aerides]

Houses here are sitting longer now, and there are more of them. For most of 21/22, there has been 1-2 houses in my neighborhood on sale at any time, and they went in a few days, usually over- asking.

Now I see 6 listings, most are about a month or two and all at the higher end of any sales from May, and about $50k more.

A neighborhood near me that I always liked, had a few that really pushed over price, and those have come off market with no sale. Others that are ok-priced but still pricey, are always active 6+ weeks.

No burst, just no more air going into the "bubble".

 

[DuluthGA]

We are in north Atlanta area (like 30 miles from downtown). Houses here are sitting 3-4 weeks instead of 3-4 days, are selling at list instead of over list and aren’t getting multiple offers.
We went under contract in late April on our big house in 2 days, with 23 offers and 17% over list. No offer was at list. Felt like panic buying. I know we over paid for our new home but we made twice as much on the home we sold than we over paid and got a new home v/s 30 year old.

 

[ncbill]

Oldest kid is champing at the bit to buy but I tell him to wait until winter when prices should be softer since he has no worries about being laid off due to economic conditions (he still owes Uncle Sam several years on active duty)

I think the urgency is driven by my suspicion he'll be proposing to his girlfriend around that time as well.

 

[Magus]

Houses here are sitting longer now, and there are more of them. For most of 21/22, there has been 1-2 houses in my neighborhood on sale at any time, and they went in a few days, usually over- asking.

Now I see 6 listings, most are about a month or two and all at the higher end of any sales from May, and about $50k more.

A neighborhood near me that I always liked, had a few that really pushed over price, and those have come off market with no sale. Others that are ok-priced but still pricey, are always active 6+ weeks.

No burst, just no more air going into the "bubble".

Similar near me

 

[Chuckanut]

Nothing is selling on my block. But, then nothing has gone on the market for the last four months minimum. It's almost as though buyers and sellers are taking a time-out.

 

[HawaiiShrimp]

Nothing's selling on my block.
My house topped at $1.6m. Now it dropped to $1.4m (estimate). San Diego (VHCOL area). Demand is still high even though interest rate hiked and less qualified buyers out there.