4 ms·

My mother is a part-time real estate agent (mostly for friends and family type work). She's got one house on the market now and having a hard time selling. If t

My mother is a part-time real estate agent (mostly for friends and family type work). She's got one house on the market now and having a hard time selling. If they don't get an offer in the next week or two, they'll be lowering the asking price. Just one datapoint/anecdote, but it's a far cry from the last few years in my experience.

geerlingguy 3y ago
That seems much more reasonable than the status quo of houses being purchased for 10-30% above asking price, in cash, before an open house happens, sans inspection. It's been frustrating seeing a few friends try to buy a home in the past couple years, but basically get steamrolled at every turn because they aren't willing to drop all their income on a home purchase sight-unseen.
jtbayly 3y ago
My zip code average selling price is above 100% list price still...
- sokoloff 3y ago
  Initial listing prices are arbitrary though, chosen to provoke the buying response the seller thinks will be best. If I think a house will sell for 100 units of value and I list it for 80 and sell for 100, it went for 125% of asking. If I list it for 125 and sell for 100, it went for 80% of listing. Nothing changed about the health or frothiness of the market; the only difference was my listing price strategy.
pzo 3y ago
In my hometown prices doubled in the last few years. If someone still wanna sell at peak prices or offer just 10% discount from peak thats no wonder hard to sale in current environment where harder to get credit, people lost job or inflation reduced their money power.
phh 3y ago
cf sibling's comment: You need to factor-in credit's price. I've been looking for a flat near Paris for 2 years, and sure the prices are lowering. But still, the cost (either total cost, or percentage of my salary) for me increased. My mental model of housing in my area is that I have the n-th salary in that area, so I get the n-th best flat. The pricing will then be exactly what I can afford (which is legally 35% of my salary here). What changes is who gets how much, 3 years ago it would go at 95% to the previous owner, nowadays it's 70%.
yomlica8 3y ago
Around here people are still waiving inspections! I think it is less insane than it was but the supply hasn't really changed.
HWR_14 3y ago
It's hard to respond to that datapoint since we have no idea what the asking price is or how reasonable it was. The entire rest of the block has sold in 2023 and it's at the same price point? Twice that price point? Twice the price of 2021?
- hotpotamus 3y ago
  Yes, real estate is extremely individualized. This is someone who's been buying and selling houses in the same market (which is South Texas) for well over 20 years now and has seen the ups and downs, and is currently seeing the first down after a few years of craziness.
  - HWR_14 3y ago
    That wasn't my point. I was saying "moving the asking price" is a useless metric without knowing anything about it. I can list a random suburban property for 100MM USD, and will have to drop the asking price by over 99%. The horrors! But it tells you nothing about the market.
    - hotpotamus 3y ago
      Do you think an experienced real estate agent (who only gets paid via commission when they actually sell the house) would price a house several thousand percent above a rational asking price? If anything, selling agents are incentivized to lower prices and up their volume; a change of a few tens of thousands of dollars might affect the home owners bottom line a lot, but the selling agent only loses 3% of that amount.
      - HWR_14 3y ago
        Obviously I choose an extreme example. But yes, I think a professional real estate agent (especially a part time friends and family agent) could misprice a house and need to lower the asking price. Or that the homeowner could insist on a higher price. Apparently, one of those is exactly what happened! That doesn't tell me anything about the housing market.
plopz 3y ago
Another datapoint: I listed my house 3 weeks ago and had 8 offers within 3 days, the highest being 10% above asking. Currently waiting on the appraisal but it seems likely that it will eventually sell for nearly double what I bought it for in 2017.

geerlingguy 3y ago

That seems much more reasonable than the status quo of houses being purchased for 10-30% above asking price, in cash, before an open house happens, sans inspection. It's been frustrating seeing a few friends try to buy a home in the past couple years, but basically get steamrolled at every turn because they aren't willing to drop all their income on a home purchase sight-unseen.

jtbayly 3y ago

My zip code average selling price is above 100% list price still...

sokoloff 3y ago
Initial listing prices are arbitrary though, chosen to provoke the buying response the seller thinks will be best. If I think a house will sell for 100 units of value and I list it for 80 and sell for 100, it went for 125% of asking. If I list it for 125 and sell for 100, it went for 80% of listing. Nothing changed about the health or frothiness of the market; the only difference was my listing price strategy.

pzo 3y ago

In my hometown prices doubled in the last few years. If someone still wanna sell at peak prices or offer just 10% discount from peak thats no wonder hard to sale in current environment where harder to get credit, people lost job or inflation reduced their money power.

phh 3y ago

cf sibling's comment: You need to factor-in credit's price. I've been looking for a flat near Paris for 2 years, and sure the prices are lowering. But still, the cost (either total cost, or percentage of my salary) for me increased. My mental model of housing in my area is that I have the n-th salary in that area, so I get the n-th best flat. The pricing will then be exactly what I can afford (which is legally 35% of my salary here). What changes is who gets how much, 3 years ago it would go at 95% to the previous owner, nowadays it's 70%.

yomlica8 3y ago

Around here people are still waiving inspections! I think it is less insane than it was but the supply hasn't really changed.

HWR_14 3y ago

It's hard to respond to that datapoint since we have no idea what the asking price is or how reasonable it was. The entire rest of the block has sold in 2023 and it's at the same price point? Twice that price point? Twice the price of 2021?

hotpotamus 3y ago
Yes, real estate is extremely individualized. This is someone who's been buying and selling houses in the same market (which is South Texas) for well over 20 years now and has seen the ups and downs, and is currently seeing the first down after a few years of craziness.
- HWR_14 3y ago
  That wasn't my point. I was saying "moving the asking price" is a useless metric without knowing anything about it. I can list a random suburban property for 100MM USD, and will have to drop the asking price by over 99%. The horrors! But it tells you nothing about the market.
  - hotpotamus 3y ago
    Do you think an experienced real estate agent (who only gets paid via commission when they actually sell the house) would price a house several thousand percent above a rational asking price? If anything, selling agents are incentivized to lower prices and up their volume; a change of a few tens of thousands of dollars might affect the home owners bottom line a lot, but the selling agent only loses 3% of that amount.
    - HWR_14 3y ago
      Obviously I choose an extreme example. But yes, I think a professional real estate agent (especially a part time friends and family agent) could misprice a house and need to lower the asking price. Or that the homeowner could insist on a higher price. Apparently, one of those is exactly what happened! That doesn't tell me anything about the housing market.

plopz 3y ago

Another datapoint: I listed my house 3 weeks ago and had 8 offers within 3 days, the highest being 10% above asking. Currently waiting on the appraisal but it seems likely that it will eventually sell for nearly double what I bought it for in 2017.