So...last week I read a post where a blogger (I forget who) looked at current real estate prices and commented that some properties had lost $200,000 in value from 2 years ago.
This got me thinking. I had to sell my mother's townhouse after her death in the Boston suburbs in 2006.
The property was purchased by a young, single real estate agent who was taking advantage of the fact that I had to sell fast. -he was just a year or so older than me! I was annoyed he could afford the place when I couldnt.($2,400 mortgage payments were not possible for me to sustain very long.)I was royally annoyed at the buyer because my selling price was 10k below any other townhouse listed price in the community- and it was one of the most upgraded townhouses in the community- and he got the property for 13k below the asking price- AND he got 3% commission fee because he was the realtor acting on behalf of the buyer!
Anyways- I was annoyed because he made some comment about holding it a few months and then selling it for a profit. I was still all wrapped up in the "Real estate only appreciates! Real estate is the biggest money maker ever!" that I had been hearing for the last 3 years. So selling BELOW asking price really offended me.
Well- Sure enough it was for sale 4 months later. Listed for 20k more than he bought it for!
Then price reduced. Then price reduced again.Then the price reduced to the buyers buying price. And the pictures showed a cleared out space. No furniture. He had moved out. I stopped checking it at that time. He was not going to make money off of me. That was good enough revenge for me.
I just went online. Wouldn't you know it- the dang thing is for sale again! And it's MY realtor who is selling it again! New furniture in many of the pictures- so not the original buyer. And it is LISTED for 101k below what I sold it for! Just in 2 years it has changed owners 3 times and lost 100k in value. That blows my mind. Thank GOD I did not try and hold onto that place.
-But my old realtor is using a few pics from when he sold it from me. The kitchen and study has my mom's furniture in them. Same pictures. Huh. weird.
The housing bubble just hit home for me
October 1st, 2008 at 04:08 pm
October 1st, 2008 at 04:46 pm 1222879608
We tried to sell our home in 2006 (we had a brief contract on another home - more land and better area overall - contingent on our house selling). We looked because with prices dropping we figured it was a good time to buy (it was) and with time it would only get harder to sell. We just didn't act fast enough and we got annoyed with the unrealistic sellers as well (most). IT was kind of no-win so we quickly gave up in the end. No interest in owning two $500k+ properties... SO we had to sell our home to make it work.
Some of our competitors (well, 2) were asking $600k though the bubble had burst. We would have settled for $499k for our home.
IT was interesting. We got a lot of offers at $450k (people just calling up saying $450k sight unseen, to test our desperateness) but not a lot of interest or serious offers. I think we asked closer to $530k, but some of the realtors and neighbors were really nasty about it like we were bringing down the neighborhood. We felt it was a very realistic price, particularly given our short window to sell. Just because there were only 2 houses for sale asking $600k, well there were a lot of sellers asking for a lot less in surrounding neighborhoods.
On the flip side we got a lot of attitude from non-owners for being greedy sellers. Okay, yes people, we would walk away with a $250k profit if we got full asking price, but, you know, if we accepted less out of the goodness of our hearts, where the hell are we supposed to live? I mean, come on. We were buying a very similarly priced home. Greed? I think not. (& anyway, as if they would just give away equity if the tables were turned. Pffft).
In the end, the house behind us changed hands multiple times in the $600k range and eventually foreclosed in the $400k range. The other home actually did get over $600k (6 months or so later) and foreclosed shortly thereafter. That one is still owned by the bank - it's been over a year.
Today the same house is $350k. Last I looked anyway. It's probably dropped closer to $300k. I wouldn't be surprised.
Just, complete madness.
I daresay if we look to move when things settle down, we may come out ahead, just because prices have settled so low. For us, maybe for the best.
I could never imagine who in their right minds would have paid $600k for those 2 homes though. Some people got suckered BIG time.
October 1st, 2008 at 05:25 pm 1222881935
Thank goodness I'm not selling anytime soon. The problem is, I have an ARM and can't refinance, because I don't have any equity.
October 1st, 2008 at 06:01 pm 1222884063
October 1st, 2008 at 06:31 pm 1222885874
October 1st, 2008 at 07:15 pm 1222888543
We were actually going to sell our first home for a $100k profit, after just a year, and then we tried to sell it like 9/10/01. We were lucky we broke even after expenses, in the end. BAD Timing.
So we moved and our 2nd home went from $300k to $600k practically overnight. I know a lot of people viewed us as quite rich at that point. We were lucky we had that experience already. All I kept saying was "Easy come, easy go." Not that we didn't fantasize about moving again and cashing out the equity. But I tell you we were not going to do anything drastic until we had the cash in our hands. Lesson learned.
I didn't expect the crash would have been so fast and steep here, honestly. But I am glad I didn't get too attached to my equity. So many people here are mourning the loss of money they never really had (& a lot of them spent it!!!!). For us, life just goes on as it always had. Heck, we still have profit, and with as much as we have put down and paid off, we could still walk away with six figures if we had to sell, but most everyone around us is just freaking out.
October 2nd, 2008 at 04:24 am 1222921464