I have lots of opportunities to respond to would be sellers who inquire about the state of the market and what their house might sell for on today's market. I use the phrase above a lot as an opening positioning statement. There is absolutely no doubt left in anybody's mind that the value of their home has gone down over the last 2-3 years. There are still those who are convinced that their home was somehow passed over for most of the devaluation and that it must be worth nearly what it was the lat time that they had it appraised for a refi loan (usually within the last 5 years). There are also the Eeyore's of the world who are sure that their home has lost most of it's value and that they are so far under water that they can't sell.
Of course neither extreme view is correct in most areas. We do have some pockets of deep loses, such as Detroit, Ypsilanti and Pontiac. And we have some areas that have held values up fairly well - Ann Arbor comes to mind. The statistics that I track tell me that we have generally lost between 20-40% of home values over the last 3 years. The peak is generally acknowledged to have occurred in the 2005-6 timeframe. Obviously statistics based upon averages only give one a starting point from which to evaluate any particular house. Things like the quality of the house and its condition weigh in heavily to moderate the averages.
One of the reasons that people believe that they can't sell is that they see and hear so many stories of homes just sitting on the market. It is true that the Days On Market (DOM) for many price bands has gone up considerably, especially for higher-end homes; however, a major factor in the elongation of the selling process is the lack of buyers out looking in the higher bands, rather than the price (perceived value) itself. Homes in price bands above $250,000 have always been considered to be "move-up" homes and with all of the turmoil in the local job market that have been few people brave enough (or secure enough in their jobs) to risk moving up right now. We probably get as much traffic in those higher price bands from corporate relocations as we do from local people seeking to move up.
So, is it a good time to sell and what can you get for your house? To answer the first question I always ask what the motivation is to sell. If you have a good reason, whether it be to downsize because of retirement, or because you need to move (for work or whatever reason) or you need to or want to move up in the housing market; then it is a good time to sell. As for what you can get for your home - less than you had hoped but more than you feared. Let your Realtor do a Market Analysis and they'll tell you what that is likely to be.
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