Straight From the Horse's Mouth
Sonoma's Index Tribune Sunday Real Estate section had some interesting tidbits....
I especially liked a few observations of a local real estate agent in an article (March 3rd, 2006) about when the First Offer Is the Best Offer....
"When there is a great deal of money around, a minimum of inventory, plus a willingness to spend freely, prices respond by climbing."
"In a cooling market....
Buyers take time and courage to make that offer. And there may beonly one buyer willing to step up to the plate...."
"We are all wearing different lenses.... Rarely is this more evident than when buyers and sellers are looking at the same property."
"extreme markets- either hot or recessionary in nature exacerbate the obvious differences..."
"As buyers and sellers and agents stumble through a 'changing' market, it is wise to keep the saying ("your first offer is usually your best") close at hand."
Oh goodness... guess what else?
"Today we are seeing buyers hesitate long and hard before putting an offer on the table. We are also seeing a rapidly increasing inventory in some price ranges with many 'price adjustments' (read that, 'price reductions') in the first weeks and months of inactivity on a new listing."
Wait ...there is more!
"The marketplace, stalled for whatever reasons, has spoken in its very silence."
Her advice to the seller:
"When a buyer decides it is time to make a statement about the value of the property to him, it makes sense for the seller to try to work with that buyer."
Of course there was also the requisite ad by another real estate agent- complete with photo of the agent asking: "WHAT BUBBLE?" and proclaiming that it has never been a better time to buy.
posted by Athena @ 12:55 AM
9 Comments:
Nice observation, just wondering who would be buying now in Sonoma.
Investors? Unlikely.
First-time buyers? Why here? There is no new jobs around.
The only one I see are the folks upgrading from cheaper houses to move to more expensive ones, but they need to sell theirs first, I guess that's when they can take the advise about first offer:)
well and you have to hope that they can qualify for a better loan. Since 69% of buyers in Sonoma used some form of the Interest only, Arm loans, with a good proportion being negative amortization loans... to keep the payments low... many are going to be resetting this year and even more next year.
The real issue behind this- is the fact that these loans were even being used is an indication that they probably were used by people who couldn't qualify to buy the house any other way. Which means that average household income of about $46k in Sonoma is going to play a big role soon in the number or lack thereof of buyers.
I think Sonoma saw its last wave of the market of people who will be left holding the bag- those that could least afford to buy, likely have shoehorned themselves into houses and will find themselves in trouble.
Foreclosure.com tells a story of own about what is starting to happen.
further, even if someone wants to upgrade or downgrade, they will need to sell their house, and with the inventory on the market that may prove to be tougher than they expect.
We will see how it plays out in Sonoma. From my perspective I heard entirely too many people thinking they could make money for nothing celebrating the rise of the median house price, and the increase in their own imagined equity. They seemed incapable of doing simple math... when the price rises above the ability of the consumer to purchase your shoebox... what then?
LOL... I heard such great answers to that! :-D Things like:
1. there will always be buyers
2. everyone wants to live here
3. Sonoma is the new sausalito!
bahaahhahahaha.... right..!!!
Sonoma is the new sausalito!
Classic cognitive dissonance.
So I wonder if Mr. "what bubble?" realtor works at office in the square that displayed "There is no bubble" in window?
Some realtors complain they're getting an unfair rep from the blogs, but if they were forthright, there wouldn't be a problem.
ah... well this one was a Ms. What Bubble?
maybe a better picture for their advertising would feature agents with hands over their ears, hands over their eyes and hands over their mouths?
Hear No Bubble, See No Bubble, Speak No Bubble?
Too late. The facts are out there.
Oops, I stand corrected.
"...hands over their mouths?"
At least; realtors talk far too much.
interesting about foreclosure.com and where exactly those house in pre-f are located.
A geat many of the f'brs seem to be located in the area of town that was once the most affordable, the Westside , AC and BS. Those neighborhoods have, in my opinion skyrocketed in price in a most bizarre fashion. When shoeboxes in the Springs are selling for 8k and up, we know we're in trouble reality ( if not realty) wise.
The folks who overextended to get into those nabes, or who have sucked out unreasonable amounts of equity from El Verano etc will be the first to go belly up, which is what we're seeing now. Soon to be followed by the East side since no one is immune from greed.
Did you also notice that many of the names in the springs area are ethnic... and I am wondering how many of our poor immigrants actually ended up victims of predatory lenders getting them qualified for risky loans to have their own chithole in the springs... and then they got weighed under by the interest reset?
did you notice the properties on Encinas? More than one property is in foreclosure... those are those attached chouses in that enclave just off highway twelve, mostly hispanic residents... I think that your observation about where the bulk of the first foreclosures are is very sharp.
who would have been the first line of buyers in that area? Those who already live in that community right?
People wearing white collars and trying to find a nice neighborhood for their whitebread middle class lifestyle aren't really the first in line customers to the springs area.
they only come there last when they are priced out of the east side... THEN after the initial customers extended themselves and bought into the springs the property values rose from the activity... and then you have those people who can no longer afford the east side buying late in the springs.
my next question is... What next?
we have friends on the east side that sold their condo to purchase a house in the Springs. Most likely for too much money. The other houses I'm also noticing are those behind Maxwell Park, off Arnold Drive..waaaay too overpriced. I'm thinking off Gillman, Grove, Riverside etc. Lotsa REOs showing up there.
yup... the last 2 years has changed the valuation of those houses from the people who would otherwise rather live on the east side... but could buy more house on the other side.
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