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What YEAR are you buying in?

By Deelyn Neilson

Real Estate Agent with Liz Moore and Associates 0225175265

March 21, 2013 11:29 PM

I recently received an email from an out of state buyer who indicated that they only wanted to find a DEAL on their next home. They wanted a bank owned property, one within walking distance to all of the local amenities and with a lower level. Oh yes- and- an elevator. The word DEAL was emphasized 3 times. My response back, in as kind a manner as possible, was that the amount of inventory that we currently have listed that is ‘bank owned’ was down dramatically and what was still available was sitting there for a good reason. The additional features that they are demanding in their ideal ‘deal’ property are virtually non-existent in our ‘regular’ inventory (i.e. what is currently active). Niceties aside, I really want to email back- WHAT YEAR ARE YOU BUYING IN? The thought then occurred to me that as we see the tides turn on real estate sales- we are now going to face a reversal of our prior dilemma of getting sellers to face the reality of their declined values. We are now going to be facing the exact opposite of buyers that refuse to recognize that they can no longer demand a perfect home at a steal price. They will no longer be afforded the option of TIME - let’s think about it and make an offer next week/month- but only if I can get a TSEAL of a DEAL. Honestly, I am ready to see a shift. Not so much a dramatic shift with sellers now getting away with doing nothing, repairing nothing etc. but more of a feeling that things are somewhat equitable. I would love to respond back- yes- I will be able to get you a DEAL but a FAIR DEAL. The 'steal deal' days are now in the rear view mirror.

Can real estate be 'fair'? As we swing to the middle of the market and into the unknown of a BALANCED market I think so. Now, getting buyers to recognize that the ‘steal deal’ days are done is the next challenge.

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Debbie Reynolds, C21 Platinum Properties

Platinum Properties- (931)771-9070 - Clarksville, TN

The Dedicated Clarksville TN Realtor-(931)320-6730

They won't believe it until the media starts telling them over and over. Have a great day, Deelyn.

Mar 21, 2013 11:38 PM

Kat Palmiotti

eXp Commercial, Referral Divison - Kalispell, MT

Helping your Montana dreams take root

Buyers will believe things have changed after they ignore their agent's advice and lose out on a great house because they waited too long, or made a lowball offer, or didn't believe there were multiple offers in play.

This is already happening in my area!

Mar 21, 2013 11:52 PM

Pat & Steve Pribisko

Keller Williams Greater Cleveland West - Westlake, OH

Deelyn, we still have buyers who contact us wanting a deal. Then, after we show them a bank owned owned home, they want to look at "normal" homes. In Northeast OH (the Greater Cleveland Area), we have shifted to a seller's market. We are in need of inventory at most price points.

Mar 21, 2013 11:53 PM

Tom Jansson

Acuity Home Inspections - Chicago, IL

Chicago Area Home Inspector - InterNACHI Certified

The shifts in real estate, as reported on the AR blog roll, have been really dramatic this year. And you're right... the awareness of market conditions has not filtered into the public consciousness. Clearly it's up to the agents to educate, educate, educate.

As an inspector, I'm somewhat of a bystander to market conditions; they're not my specialty. But I'm wondering, just because I'm curious: what happened to all the inventory?

I thought that, 1 or 2 years ago, the problem was too much inventory. Where did it go? Did big investors swoop in and quietly buy up bulk packages of REOs, or are the banks taking properties off the market to stimulate prices?

Again, this isn't my specialty, so please forgive me if I've missed something obvious about this market. Inquiring minds want to know...

Mar 22, 2013 12:04 AM

Deelyn Neilson

Liz Moore and Associates - Williamsburg, VA

Deelyn Neilson

Tom- your question about where did all of the inventory go is a great one. In my area, we have seen inventory decline as a result of several factors- acouple of reasons: astute buyers recognizing that the market is shifting and buying while values are still low combined with low interest rates, the absence of the 'discretionary' seller (those that really don't need to sell) so fewer homes listed. I would say that the primary reason that is pushing home sales is the fact that more consumers had turned to renting instead of buying. (either out of a forced situation like being foreclosed on or a job/ marital change or out of pure fear of not wanting to invest money in a home). Rent demand is way up causing rent rates to go up. It is now less expensive to buy a home than it is to rent the same home. All things point to more demand for re-sale homes.

Mar 22, 2013 12:23 AM

Deelyn Neilson

Liz Moore and Associates - Williamsburg, VA

Deelyn Neilson

Debbie- I LOVE your response about the media. I am a total believer in media SPIN. Consumers hear it or read it and then it autmatically becomes the truth!

Mar 22, 2013 12:48 AM

Patricia Kennedy

RLAH@properties - Washington, DC

Home in the Capital

Oh, Deelyn! Can't you find them something really ugly that smells like cats? But hey, in my market, even the dumps are selling!

Mar 23, 2013 02:41 AM

Patricia Kennedy

RLAH@properties - Washington, DC

Home in the Capital

Hey, Deelyn! I included this post in Last Week’s Favorites. Please drop by and check it out, and enjoy the rest of your weekend.

Mar 24, 2013 04:20 AM

Steven Cook

No Longer Processing Mortgages. - Tacoma, WA

Deelyn -- came over on Pat's suggestion. You are right but as always realty is local. We have just (in last 4-6 weeks seen a big upsurge in foreclosure listings again - after several months of NONE.

Mar 24, 2013 12:17 PM

Deelyn Neilson

Liz Moore and Associates - Williamsburg, VA

Deelyn Neilson

Steven- Thank you for your response. Yes- agreed 100%- real estate is certainly local. I can drive 45 minutes away and will find many more foreclosures. It all comes down to demographics- my little town of Williamsburg sees a lot of retirees and professionals. The retirees certainly add an element of stability to the market in general as they don't tend to relocate as often - no job changes etc and many have homes that are mortgage free.

I am sorry for the uptick in your foreclosures- that is certainly a bummer and does not lend to market recovery. Good luck with your spring market!

Mar 25, 2013 01:37 AM

Adele Tamburo

Weichert, Realtors - Point Pleasant Beach, NJ

Making Home Ownership A Reality!

Deelyn I usually say under my breath "go to sleep and wake up in the year 1999 maybe then you can find what you are looking for". :-) Good luck.

Mar 25, 2013 06:30 AM

Tni LeBlanc, Realtor®, J.D.

Mint Properties, Lic. #01871795 - Santa Maria, CA

Tenacious Tni (805) 878-9879

Unrealistic buyers just got a jolt with the market uptick.

I have more than a few "buyers" calling and expressing regret.

They missed a 4 year window to buy. Hardly a fast moving ship...

But prices got so low, they got a bit too "optimistic" LOL.

Our prices hit about 2001-2002 levels, and of course that's at much lower interest rates. Still there were folks waiting for 1999 again. Maybe they were listening to too much Prince? LOL.

It's 2013 -- you can't turn back the clock, not even to 15 months ago, much less 15 years.

Mar 25, 2013 06:55 AM

Sharon Parisi

United Real Estate Dallas - Dallas, TX

Dallas Homes

Deelyn, many Dallas buyers are having a difficult time with the concept of a Seller's market. A colleague shared this morning that she has a buyer who has lost out on 4 homes because she is making low offers on properties that are priced right and selling within 48 hours!

Mar 25, 2013 08:52 AM

Bette Gottwald

UNITED REAL ESTATE | Central PA - Mechanicsburg, PA

"Bet"on Central PA Real Estate!

Oh Deelyn, I understand the "Need-a-DEAL-Type." I just refer them to new agents who need experience in writing contracts.

This past week, I wrote three (3) offers for a young couple I had counseled as “first-time buyers.” At their parents’ insistence, they had it in their minds they needed to get a “bargain.” I advised them the home wouldn't last long because of the lack of inventory in our area, plus there had already been several other buyers look at it in just the first 3 days. They didn’t take my advice, and the Sellers received a full offer – they lost the home for a few thousand dollars, which would have only costs them about $12 more in monthly payments. They were crushed! Their next offer, on the 2^nd home, was a full offer, but they asked for 4% in closing! Once again, they lost to a nearly full price offer. The 3^rd home, they made an offer over the list price, asking for 3% in closing, netting the Seller his asking price. Seller accepted. Oh, did I forget to mention the parents stayed home this time? LOL!

Mar 25, 2013 10:46 AM

Jon Zolsky, Daytona Beach, FL

Daytona Condo Realty, 386-405-4408 - Daytona Beach, FL

Buy Daytona condos for heavenly good prices

Deelyn - I think we all get those people insisting on a great deal. A little dose of reality is what they need. Thank you for a very good post

Mar 25, 2013 03:04 PM

Deelyn Neilson

Liz Moore and Associates - Williamsburg, VA

Deelyn Neilson

Thank you all for your responses!

Adele- loved your thought of going to sleep and waking up in 1999 prices!

Bet and Sharon- I agree that it is the first time buyers that will have to lose out on a few before they fully understand the reality of today's market. I have experienced the same thing with one of my listings- a buyer that literally took 3 weeks negotiating and came within $2000 of having a deal. I had cut my commission as the listing agent as had the buyer's agent. The buyer then saw us as an "ATM" and indicated that we should further cut our pay to make his deal work. I refused to do so and so we sat for a few more days. Another (and far better offer!) came in followed by TWO more. The first buyer then came back and offered what we had originally wanted- but at that point his opportunity was long gone. I must admit that it did feel good to get 2 more offers after that buyer tried so obviously to take advantage of his agent as well as me!

Bet- your reality check of buyers being crushed after losing out on a home over $12 a month is quite a wake-up call! It is unfortunate as we will all be experiencing this until buyers can recognize and understand that market conditions have changed.

I AM glad to see that homes are moving almost everywhere in the country!!

Mar 25, 2013 09:03 PM