. . . AND MOST AGENTS DON'T KNOW IT! Worse yet they probably won't figure it out until their listings begin to expire with no showings.
My wife went into the office today and was greeted by some dramatic news: Pulte Homes has cut the price of their Fore Ranch community by over 30% in one day!
One of the agents in our office who does a lot of work in that community received an advance email from someone in the Pulte sales office of a possible 25% reduction, but today as the news was made official that it was closer to 30%. tHIS WAS IN BOTH THEIR FAMILY AND 55+ COMMUNITIES. This move places many existing home owners in that subdivision with conventional mortgages - even those who had put 20% down - upside down in their mortgages
This is going to devastate the entire Ocala resale market. Spec homes that were reasonably priced are in one day 30% over priced and now don't have a snowball's chance of selling. Other resale homes are now in the same boat over night they are drastically overpriced. It may not be evident over night, but the ripple effect is going to be staggering if you don't lower the selling price of the chances of selling your Ocala home will drop exponentially every day.
My wife and I have already called all our sellers and told them that if they need to sell they need to consider a series of step down price reductions over the next 6 weeks, before all the other agents in town catch on to what is happening and panic sets in.
Are we over reacting? I think not! Agents are still taking over priced listings watching them expire and scratching their heads wondering why. Desperate times call for desperate measures.
Sadly, this means that when the dust settles in a few months and the trend has taken over our whole county that the only sellers that won't be upside down in their mortgages are the ones who put down more than 30% and bought more than 5 years ago.
End of the world? I think not. I am just glad I don't hold the mortgages in this town.
© 2007 Dan Homan