Sixty miles west of Boston, Massachusetts there is the small New England town of Sturbridge. Located at the junction of I-90 (The Mass Pike), and I-84 it has become known as the "Crossroads of New England". The town was first settled over 300 years ago, and like other small New England towns it has grown just enough over the years to be in a difficult place today. How do we embrace the future without forgetting how we got to our present? How do we attract the right kind of growth, and maintain who we are? And, what about our culture out here in Central Massachusetts?
These pages will cause one to think about how to protect what we have, our future direction, and how to move on in the very best way.
Those thoughts, and other ramblings, will hopefully inspire more thought, conversation, action, and occasionally a smile...
...seems to be working so far
Saturday, February 21, 2009
It's The Price, Dummy
60 days. Amazing. That is as good as if the market was normal, and they got their asking price as well.
Maybe the market is normal, but the sellers expectations are abnormal. Seems there are people out there looking for homes. First time home buyers, folks moving up, and empty Nester are all looking. Interest rates are very good, too. So if the interest is there, and the bank rates are more than favorable, then why are there so many houses on the market forever?
It's the price.
I know, like, duh, no kidding. People that bought a home when the over inflated house prices were the thing, and the banks that said, "OK, we'll give you a mortgage for that outrageous amount." are all stuck in limbo now. We know what happened to the banks, and we hear everyday what is happening to everyday people as they fall behind on their excessive mortgages. No, I'm not talking about the folks that have been affected by job losses, that was an unanticipated problem. They probably made their mortgage payments, like most of us, on time until the well ran dry. I'm talking about people that bought high, and expect to recoup their investment in order to move on into something bigger, or to another location.
It just ain't gonna happen. Not this decade anyway.
Not many choices at this point. One could sell at a loss, a short sale if the bank approved, or the seller would have to eat the loss. The only other viable option is to wait it out, and pay down your principal faster to get more in line as to what buyers are willing to pay.
Easier said than done.
Then there are those people that have long since paid off their obligation to the bank, and want to sell and move on to something smaller, maybe someplace else where golfing is a daily activity. These people are in a much better place to alter their asking price. They can match what the market is bearing at the time, but their home was their investment all these years and they counted on a certain return from its sale in order to move on comfortably.
These people are going to take a hit as well.
I guess the bottom line is that no house has to stay on the market year after year, it will sell for the right price to the right person. Go to MLS Property Finder, and choose Sturbridge and Fiskdale to search for homes for sale. Look at the prices being asked on most of them. Many of the new construction are priced as if it was 2002. They'll sit for a long time. Then look at the lower priced homes. some of those are bank owned, and in need of a lot of TLC. They'll sell eventually to those willing to put in the sweat equity. Now, check out the moderately priced home. Homes that don't require a whole lot to be done to them. These houses will sell with some tweakin' of the asking price.
Once you're on MLS Property Finder select the same locations, but check only the "SOLD" box. The site will return all the homes sold in town over the last year, or so, and the price they sold at. You'll find a lot of familiar faces there. Ever wonder what that house on Main street eventually went for? This will tell you, and it will also tell you just what the market is willing to bear here in Sturbridge.
A little research will help everyone that wants to sell make the best decision for themselves.
We love our home, but we haven't ruled out moving to a place with a little more land, and that may happen if the market begins to turn around in the next couple of years, but for now, we are content. Back in 2006, when we bought the house, the seller had listed it about 10 months before we bought it for about $100,000.00 more than we paid. We were the first offer after all the those months listed, and we sure as heck didn't offer what he had originally asked, in fact, we didn't even offer what he was asking at the time we saw it, but he sold it to us for what we expected to pay. That was what the house was worth. Nothing more. I didn't shed a tear for the seller since he had acquired the house a few years before from an estate for $103,000.00. Yes, there was some work done to the house, but it was like pulling teeth to find out exactly what he had put int it, and not the previous owner.
We bought our home for a price I was fine with for the market at the time. Price does make a sale, and we have had no regrets since.
Someday, there may be another home. Maybe the one I've mentioned before high on a hill with a great view, or something on the water, but until that day when all the selling and purchase price stars align, we are happy here.
So, what to do if you really need to sell now, and can't wait 10 months for a buyer? If you can, lower your asking price a lot, not just $5000.00. If times are very urgent, then talk to your lender about a short sale of your home. See if your bank will accept less than what is due on the note. In these times, short sales are something the bank will lean towards in order to avoid foreclosure.
Just somethings to think about offered by someone that knows squat about real estate, but just enough to make some sense.
Wally, you're absolutely spot on with this. There are many sides to it, but the bottom line is that anyone wanting to get out of one of these houses will have to calibrate to the new reality; until then, they can sit and wait.ReplyDelete