Talk in the News

Here's an article that I thought was interesting. There's so much real estate news out there so whenever I run across something I find interesting, I'll share.

How to Bargain for a HouseAs the Real-Estate Market Cools
By Ruth Simon From The Wall Street Journal Online
Home buyers are finally starting to catch a break.
After years of soaring real-estate prices -- not to mention periodic bidding wars for third-rate properties -- inventories of homes for sale are rising in many parts of the country. As a result, some buyers are regaining long-lost bargaining power.
That gives buyers in many markets more room than they have had in years to push sellers to sweeten the pot. Buyers are asking for, and often getting, concessions ranging from help in paying their closing costs to money for repairs or redecorating.
This Rhode Island home got new landscaping before being shown.

And sellers in many markets -- including once-hot areas like Phoenix, San Diego and Boston -- are finding that they can no longer just slap a price on their home and expect it to move quickly. Increasingly, they are being advised to set more realistic pricing expectations and to spruce up their property with fresh paint or some new plantings out front to stand out from the crowd.
In Rhode Island, where active listings are up 43% from a year earlier, some agents are going even further. Broker Ron Phipps recently offered the buyer of a 2,200-square-foot waterfront condo priced at $550,000 a two-year lease on an Audi TT sports car. The buyer applied the $18,000 value of the lease to the purchase price instead -- then bargained with the seller to kick in an additional $7,000 for closing costs and a new air-conditioning system.
The re-emergence of tactics like these is notable because it could signal the end of a prolonged seller's market in some parts of the country.
Some sellers are even cutting list prices outright. In Phoenix, where the number of homes on the market has climbed to 17,000 from 5,400 three months ago, "we're now constantly getting emails that prices have been reduced," says Charles McLean, broker-owner of Century 21 Metro Alliance. His advice to sellers: go "all-out" with marketing tactics like open houses. As recently as this summer, that wasn't only unnecessary, it was often impossible -- properties sometimes were selling in as little as 24 hours.
In Northern Virginia, Elaine Raabe, the buyer for three stores run by the local Realtors association, says she's having trouble keeping signs that say "price reduced" in stock. For the previous two years, she says, "you couldn't keep an 'under contract' sign in the building."
In San Diego, Steve Krescanko of Century 21 Award is advising clients to offer the buyer's broker a 3% commission instead of 2.5%. On a two-bedroom, two-bathroom home in Escondido, Calif., that recently sold for $420,000, the seller combined a 3% payout to the broker with $6,500 toward the buyer's closing costs.
Buyers can get help with closing costs near San Diego.

Of course, home sales traditionally slow in the fall. And if mortgage rates remain low, sales could bounce back in the spring. New-home construction surged in September, according to the Commerce Department. Sales of existing homes held steady at their second-highest level on record in September, according to the National Association of Realtors, or NAR. (That's partly because of a boost from Katrina refugees buying homes.)
And many "price cuts" right now are actually deceptive: Sellers who overpriced their properties are being forced to roll back expectations -- but they're still getting more than they probably would have for the same property a year ago.