Gotta love "priced right" concept, what a total crock...Also i'd be inclined to ask him what his percentage of listings are "sold" in a decent time frame...I t seems to me, he'll be happy to "list" as many homes as he can, the issue is how many will "sell"..

I would wonder about the more expensive gold coast in Chicago such as Lake Shore Drive and the Condos that are there. As well as Manhattan and Westchester. Those areas where said to be doing well 6 months ago when I last read about it. The theory being that certain rich people still have money and if they dont then foreigners want those properties because they are discounted for anyone with Euros due to the dollar. I am curious to see what bonuses will be like this year on Wall Street. As for foreigners, once they see prices down they may wait

saphire -- I think this realtor is saying that all buyers have dug in their heels. They no longer want good deals, they want 'bargains'. In my North Shore community prices are still rising but sales are down by about a third. It does seem to be slowing, although someone just bought a $25 M Benjamin Marshall-designed lakefront estate that had been on the market for several years.

Interesting story from the NY Times about Grosse Pointe, MI:

"Almost 700 homes are currently on the market in the five Grosse Pointe communities, according to brokers, twice as many as in the same time in 2005. And since June, prices for the most expensive houses have dropped by around $100,000 a month."

Here is a link that might be useful: Where Mansions Go Begging

Qdognj: I keep hearing you disparaging the 'priced right' concept. I don't understand why. It makes perfect sense to me that to price something 'right' means to price it using comparable sales that means the house will actually sell as oppoed to sitting for 6 + months with multiple price reductions.

That is what I would call "priced right" and I don't see what makes that concept a crock.
Perhaps you would explain why you so dislike the term? Perhaps I am missing something because it seems very logical to me.

priced right irritates me because it is only priced right when it sells, and since the market is declining,"priced right" changes weekly..Of course a house becomes "priced right" when it sells, we all know that...But for a realtor to say "if it is priced right" it will sell,seems kind of redundant...I bet there are lots of posters here who feel their homes are priced right(according to their realtors), but due to lack of buyers, the home isn't selling..So i guess it isn't "priced right" ;)

Yes, selling prices and DOM tell you what 'priced right' means, or did mean last week, month, quarter. The realtor whose brochure I outlined did have sales figures in his last quarter promotion. There he looked at how long some properties sat on the market before the sellers got real and sold for LESS than comps had already acheived in 30 - 100 days. (Makes me think of the saying: "Know when to hold 'em. Know when to fold 'em.")

Right now he's saying things have gotten worse since early 2007 and are about to get worse still, so get ahead of the curve. Who knows if he's right!

Qdognj:

so it's semantics. You recognize the sense of the term but don't 'like' it.

I don't know what you mean by 'lack of buyers'. Unless a place is in major decline (like areas of Detroit) there will always be buyers. If the buyers are not buying it means the houses are priced too high. If they were 'priced right' they would sell. Even in Detroit homes which are 'priced right', sell.

However what makes that pricing right is obviously what the buyers are willing to pay, not what sellers think is right. I can see how it would be an annoying term to some sellers, but it's certainly not a 'realtor gimmick' and a 'crock'. It's a legitimate term - if it is priced correctly a home WILL sell.

there are plenty of areas where there is a dearth of buyers, hence price declines to find the buyer.."priced right" is still a crock, as it didn't exist until the decline the housing market is now going through..It is a realtor term used "protect" themselves when homes don't sell.."It wasn't/isn't "priced right", but when it is is "priced right" it will sell"...When realtors suggest the listing price and it doesn't sell, is it because a lack of buyers? or wasn't it "priced right"?
And i await your response about there are buyers AT THE RIGHT PRICE!!!! Heck, if a million dollar house gets priced to 400k, i'll feel it is "priced right" and buy it..

It didn't exist before the decline in the market?? Really??

It's a term designed to 'protect' the agent? Oh please.

So I guess it's better for agents to tell sellers below market prices for their homes right off the bat so it never becomes necessary to suggest a price reduction or imply that the house isn't 'priced right' because that is just a way for agents to protect themselves. Interesting logic you have there!

If a buyer is looking for a house and there is one that attracts them to make an offer because of the price, then guess what - that house is 'priced right'.

If anything is a 'crock' it's what you are saying. I mean come on - the term priced right is a gimmick. Give me a break.

Buyers get to decide what houses are worth. Not realtors and not sellers.

I am not aware of any real estate markets in my area where there are NO buyers - there may not be as many buyers as two or three years ago, but there still are SOME buyers.

"Priced right" always existed, and always will. In some sense the term is a CYA term for the realtors who don't want to use the more accurately descriptive term "market price".

Sellers get to decide whether they want to sell at the price that the buyers have determined that a house is worth, but they don't decide what the market price is for their house.

qdognj,

I agree with you 100%.

I'm not selling, but the "priced right" irritates me as much as you. No, It irritates me more!!! lol

Sure there always are houses that NEED to be priced right. This is where the seller is asking a ridiculous price.

However, for those sellers who are priced under comps & the buyers are not buying, the "priced right" concept does not apply. Basically, buyers want a steal, because the seller had to list when the market got "shakey".

When the RE market tightens, buyers are hard to come by. When they do, they dream up prices to their liking. They offer where they would LIKE the house to be, Not where it should be, even with the market correction.

My favorite one was when I spoke to this women last year. She lives in the same town. She said, geez, the prices NEED TO COME DOWN, otherwise I'm not buying. All is good, but she lives in a medium sized Colonial house & wanted to buy something 500-600sqft larger. What was she thinking? Did she think that the larger houses will drop just FOR HER, but hers was going to stay the same? I don't get it when buyers talk stupidly.

The only time when a buyer can get a bargain is when they are a first time buyer, or people who sold a while ago, are renting & will be buying in the depth of the RECESSION. Yup, I said Recession. Deja-vous, Bush I, 1992. Now, Bush II, 2008. It's coming. Brace yourselves....Oh, did I mention that WE ALL need National Health Insurance? The rich are not suffering in that area.

The housing market has a serious supply and demand problem, since the supply is very high, there is simply a lack of buyers.This is a fact..So,brewbeer is correct there are SOME buyers, but not nearly enough for the existing supply..Hence, "priced right" is a crock, because it isn't "priced right" until the buyer decides it is worth it, not the realtor or seller, as pointed out by brewbeer also...When a realtor suggests a price and it sells for 15% less, was the home NOT "priced right"???
"priced right" is not determined until the sale, so who knows when the home is listed if it is "priced right"

qdognj; "When a realtor suggests a price and it sells for 15% less, was the home NOT "priced right"??? "

EXACTLY.

"priced right" is not determined until the sale, so who knows when the home is listed if it is "priced right"

You know if it goes into contract in a timely manner. If not, it wasn't priced right.

dabunch; of course it's irritating for a seller/ home owner. Anything that has anything to do with lower prices is irritating. Doesn't mean it's not valid to use the term 'priced right'.

It does a realtor no good, and some harm, to take listings on houses that are not 'priced right'/'priced to sell'/'market priced'. (Pick one; it's all the same.)

This realtor's earlier brochure detailed a market at the beginning of 2007 where SOME houses had sold within 30 - 100 days while others (Have to take his word they were comps.) languished for over a year before finally selling for LESS than the 'priced right' homes. The 'priced right' homes were ahead of a downward curve. They contributed to it!

This is not just a normal supply and demand problem. Lenders contributed to a home-inflation economy. Record numbers of homes are now in forclosure. The 'piggy bank house' is broke. Now lenders have tightened their lending rules. People are nervous.

Could the sinking dollar help real estate?

People who are buying $3M+ homes are not getting mortgages. They pay cash. People who have $3m+ in cash to buy a home are not worried about the housing market. The point is moot.

Chisue and dsmarie

My point was that in the coming months it will get worse because you will suddenly see financial types who previously could afford 3m houses and condos suddenly concerned because they are not gettting the same bonuses they did last year. Some may not even have a job. Plus even someone who can afford 3m may need to sell his 2m smaller house first and those buyers still use mortgages. While it is not apparent yet, the age of greed is over temporarily although many do not know it yet. I was thinking also about the big city gold coast condo market and the Westchester market because they have not yet been effected. Plus while most Europeons do not want a house Lake Forest or Skokie, they may want one next door to Oprah on Lake Shore Drive or in one Trump's buildings in Manhattan. So there is a separtate market for these apartments. Westchester is still swimming in Wall Street money but I wonder for how long

As for priced right, I think it means different things in different markets and times. For example, I have never had qualms about offering 20% less than asking, now or in 1993. The worst they can do is say no. Yes there are areas where buyers pay close to list and there price is more important. Also in a sellers market. The problem with the market now is that priced right really does not matter anywhere because unless a buyer MUST buy eg transfer where they will only pay costs for a short time, everyone has the sense that unless the house is really special (eg very nicely decorated, yes bells and whistles matter, or much larger property or a historical house), there is no reason to buy THIS house now when it or another like it will cost 10% less in a year. So there has to be a reason to buy beyond this house is your basic split and you need another bedroom, or the price has to be so low that it will not be lower in a year

"priced right irritates me because it is only priced right when it sells, and since the market is declining,"priced right" changes weekly.."

I would agree. I live in metro Detroit. My neighbor bought her house two years ago for $365,000. Since then, there are four houses for sale in our sub and no sales. She will be listing her house in about 6 months due to a job transfer. Her own house will be her only comp and I can guarantee you NO ONE will be giving her what she paid for it. I guess all she can do is find the highest price comparable home for sale in our sub and match the price????

I talked to a lady having an estate sale on the the next street. She is moving to OH, her house is still not sold -- she has come down over $40,000 in a little over a year. In over a year's time, she has had only FIVE showings.

Another house in the sub for sale started at $380,000 almost 2 1/2 years ago. They were at $350,000 for a long time when their realtor convinced them to take it off the market and remodel the kitchen (20 year old original). They did it (granite and all that) and relisted for $10,000 less than before the remodel -- still sitting there.

It is really scary around here.

As the latest statistics from the NAR confirm, housing prices are continuing to drop in most US markets. They've already dropped about 10%. There are a few exceptions, of course, but broadly speaking, the market is terrible for sellers in most of the US.

Most analysts believe that sellers are still pricing their houses too high and that listing prices must be dropped further before more buyers will be lured back into the market. In other words, the seriousness of the real decline has not sunk into the consciousness of the average seller, who continues to list at too high a price. So I think that's what REAs are talking about when they say the house will sell "if priced right" -- ie, below what most sellers think is "market value."

More upsetting still, the analysts I've heard or read believe that the situation isn't likely to reverse itself for at least a year or two and maybe even longer than that.

livvysmom -- Is *anything* selling? If so, those homes were 'priced right'. If *nothing* is selling, that's another kettle of fish, but it some homes are selling, your neighbors who are NOT selling are over-priced and seem to be riding the market DOWN.

Anybody thinking that some people will 'invest' in reduced houses as a hedge against the falling dollar? (Anybody see TV reports of Europeans flocking to US malls? They are buying our 'cheap' housing, too.)

chisue -- there are few buyers around here. The problem is most people cannot buy a new house if they cannot sell their old.

I have been eyeing houses in a sub in a neighboring community for a few years. They were built 4-5 years ago for mid to hight 700's. They are now high 400's, low 500's. I would love to "move up" to one of these but I can't do that if my house won't sell. Also, I won't get enough for my house to move up (everything is relative).

Did I also mention we spent $70,000 on a new kitchen/addition 3 1/2 years ago that is now worth nothing???

livvysmom, do you LOVE your kitchen/addition? Have you enjoyed the improvement? If yes, then don't worry about it...I am of the opinion that make improvements for YOUR enjoyment, and if you are concerned about what it may or may not be worth at some time in the future, don't do it...Who knows where the market will be 5-10 years from now, so if you can affordably make the improvement, i say do it..

qdognj, that was my attitude about every phase of our remodelling: I'm doing this to increase my enjoyment of this house, not for some mythical buyer in the far-away resale future. I don't regret any of them, because they made our home much more pleasant for us. However, it does hurt just a smidge to have just dumped $40K+ into a kitchen remodel then decide to move when it was 99% finished. I made several choices thinking it was my "10 more years" kitchen that certainly wouldn't have been done had I known I wouldn't be the one using it!

tauphidelt, i here ya!!! We did significant remodeling in the precedeing year or 2 prior to moving, but we enjoyed it, even if for only a small time...Don't regret it for more then 1 minute though ;)

Ok, lets start a new annoying catchphrase so we can at least be original: Priced Wrong! For instance, a friend of mine has tried his hand at flipping and is going to lose money on the deal. He has had 28 showings in 6 months and just got his first offer today, for 93% of his (now) asking price, or 84% of his original asking price.

One offer out of 28 showings? Priced Wrong!!!

Qdog, ever been "Rightsized" out of a job? Now THAT'S annoying...

mfbenson -- Oh, that's good! I like that. We could sell ink stamps to buyers and realtors: "Priced WRONG!"

This is an awful time to be selling in most parts of the USA. Especially hard on people who bought during the Bubble and now have to sell. If you bought before Bubble or don't have to sell, time will level it out -- looks like several years of time, though.

chisue: "This is an awful time to be selling in most parts of the USA"

Well, after the country sinks into a recession next year, people may look back fondly on the fall of 2007 and say that would have been a good time to sell! :-0

We just relisted our house - 3rd agent. In 6 months the comps in our area (NJ) have dropped 10%! Avg comp house when we first listed was selling at $439-$449K - now down to $400K. Not great - our friends bought a smaller, less updated bilevel several blocks from us (on the corner of a very busy road) for just about what we are going to relist our updated top condition colonial in a cul de sac for tomorrow. Not pretty! Our agent noted that with credit tightening, a whole first time buyer segment has been nearly eliminated, so smaller buyer pool as well....

"Not pretty! Our agent noted that with credit tightening, a whole first time buyer segment has been nearly eliminated, so smaller buyer pool as well...."

Which is rather good in the grand scheme of things. It's quite damaging for the economy, if we have a large number of $80k/year income families with exotic $400k mortgages who have $0 "disposable" money to spend on stuff that keeps our economy going.

If you move fast you can buy a huge early 1900s Gold Coast mansion in Chicago, originally refurbished by the architect for the Wrigley Building It's just been down from $13.5 M to... $12 M. The bank president owner has more than $13 M in it, but has been transferred to NYC.

WAit until you see the fabulous four-story oval stair with skylight. Maybe you'd enjoy the five-room master suite or the rooftop deck with separate kitchen. Wouldn't it be fun to invite your guests to step through the secret bookcase door in the library and descend to the wine cellar? If you'd like, you could move the front door back to its original place facing Astor St. (Pre-qualified buyers only, please.)

ok let's say there are 500 houses and 2 buyers, half of the houses drop their prices to priced right from lets say $400,000 to $350,000 or even $300,000 and the two buyers buy two houses, were the other 248 houses priced wrong - no - there were only 2 buyers.

if there were 20 houses and 2 buyers, half of those houses drop their prices and two buyers buy houses, were the other 8 houses priced wrong - no - there were only 2 buyers.

if there were 10 houses and 2 buyers and half of those houses drop their prices and two buyers buy houses, were the other 3 houses priced wrong - no there were only 2 buyers.

even if all the sellers drop their prices - if there are only two buyers - those buyers can't buy all the houses that drop their prices - they can only buy the ones they can buy - and those other sellers can't entice those buyers to buy more houses because they are priced right or even below right - most buyers can only afford to buy the one house they can afford to buy.

so lots of houses in lots of markets are priced right by the sellers and some are even priced below - priced right -and are not selling - it's just the luck of the draw whether the sellers sell their home to the few buyers that are out there right now - whether they are priced right or not.

This fall - is - a good time to sell - except there are 90 percent less buyers to buy and 8 times more inventory than the previous 5 years. But sellers might be able to sell if they pay all closing costs and put in a free pool and offer another percent commission to the realtors - and drop their price below - priced right - to get the attention of all the realtors desparate to sell even one house per month instead of the 2 or 3 or 5 or 10 a month they sold last year and those couple of buyers being wined and dined by every realtor who hasn't made a sale in months.

Hate to be pessimistic - but thems the facts jack for most homes for sale in most markets.

There might be only 2 buyers today (at current prices.)

But there are 3 fence sitters that were waiting for prices to go down. When prices hit a certain point for them (maybe they see 'value' now), then those fence sitters come into the market and become buyers.

Then, the seller of one of those homes now becomes a new buyer.....

"Hate to be pessimistic - but thems the facts jack for most homes for sale in most markets."

There are in infinite number of buyers, over a long enough time span. Your analogy only works if all sellers are trying to beat the same deadline.