Its just back to normal, Just a seasonal slow-down, A normal minor adjustment, A great time to buy, with a much wider selection, A cooling market, A soft landing, A slight tapering off etc. Yes, these P.C. phrases are now replacing the We should have a strong market for the foreseeable future industry line prevalent just a few short months ago.
The sad fact is people are still in self-denial here. We're "special" because of our weather. We are known as Americas Finest City after all. Its still common to hear someone say, "If you dont buy now, you're going to get priced out of the market!"
Talk about your irrational exuberance in the Southern California real estate market. In a 2004 summer poll in the LA area, residents believed prices would continue to go up by more than 20% a year for another decade!
What will be the industry P.C. phrases well be hearing in about six to nine months? It may well go as: This home is a great buy, why just nine months ago you would have paid $25,000+ morewhat a great savings. Naturally, you would be talking to a buyer. For a seller (who has owned for some years) you might say: Well, you are still making a profit. Who could have even known that the market would have turned down so fast? For the downtown high-rise buyer who though they got a real deal on the final phase of their Gas Lamp digs, a real estate agent may be saying: Well, because the resale value is actually below your 100% interest only trust deed, you really should consult a real estate attorney and/or meet with your lender to propose they accept your deed in lieu of foreclosure.
Are you reading this and thinking Im way off base? Here are a few recent headlines:
National Association of Realtors reports, in part: Total existing-home sales including single-family, town homes, condominiums and co-ops were down 5.7 percent in December from November.
Time Magazine reports that 'Vegas Condos Go Cold.
The Washington Post reports "Real estate groups in the Washington area have also reported declines to varying degrees.
"The bloom is definitely off the housing rose. Housing peaked last summer and has been weakening ever since," said Mark Zandi, chief economist at Moody's Economy.com.
New York City Mayor Michael Bloomberg recently said the real estate market was slowing "dramatically" and only a "miracle" could stop soaring mortgage rates from eating into housing prices. "The real estate market is slowing down dramatically and were going to have a problem down the road," Bloomberg said.
"If people who want to sell their houses have to wait a longer time before someone comes along and buys it, it would be a miracle if prices didnt start to go down," he said.
"'The market has definitely peaked,' said Jack Kyser, chief economist with the L.A. County Economic Development Corp. 'The fever has broken and now the question people are asking themselves is if there is a crash ahead.'"
This is my own opinion on a realistic view of what lies ahead as far as the San Diego real estate market: A multi-year depreciation that could easily take 30% off the highs which reached this markets peak during the summer of 2005! Plus, I foresee headlines, maybe even national, announcing how the San Diego high-rise downtown boom has turned into a foreclosure city!
As a realistic San Diego Realtor, I provide these facts to my sellers. If their property is not generating meaningful activity within the first month of being listed, it would be prudent to consider a revised marketing plan similar to what many San Diego real estate developers are doing. This would be a combination of value-range reduction as well as agent and buyer incentives to position the property as the best total value for the area.
I think as Realtors we must adapt and not deny. To otherwise will have a dramatic impact on your financial health and community reputation
Copyright 2006 websitetrafficbuilders.com All rights reserved. |
