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News Quickie: Sellers Getting Desperate Out There

A pair of articles today from the Seattle P-I and King 5 News focus in on those poor, poor sellers that actually have to work to sell a home in today’s slow market. No longer are run-down shacks full of years of accumulated junk being bid up to ridiculous heights. Now, you actually have to clean out your crap, paint a few walls, steam-clean the carpets, take decent pictures, and—oh yeah—knock a few thousand (or a few tens of thousands) off the price.

A year ago, buyers regularly bid above asking prices, waived stipulations such as inspections and used escalator clauses, which raise offers over competitors’ bids up to a set ceiling. Now, good homes in nice neighborhoods with realistic asking prices still can get multiple offers, but many sellers put more time and money into fixing them up, offer more incentives and accept more conditions, including offers contingent on sale of another home.

These days, it would take twice as long to sell the current number of homes on the market in Seattle and King County as a whole at their current sales paces than it would have a year ago. Seattle had 50 percent more homes on the market in September than a year earlier, while the countywide increase was nearly as large. Pending sales, which can be the best indicator of recent market activity, declined by more than 25 percent in Seattle and 30 percent countywide.

Update: Matt Goyer over at Urbnlivn points out a Baghdad Bob-style denial of reality from a condo marketer quoted in the P-I article. “Prices have not been cut.” Wait, yes, they have.

How about trying some of those good ol’ incentives to lure in an unsuspecting victim buyer?

Selling a home in the Seattle area has become tricker. What used to sell in one week can now take months. Home sellers are going to more and more extremes, offering enticing incentives to hook a buyer.

Those boom days when homes in Seattle could be sold in a matter of hours are for the most part over. Residential homes can languish on the market for months, so sellers are relying on incentives to try and seal the deal.

I expect a lot of languishing to carry on through the winter, and probably throughout next year.

(Aubrey Cohen, Seattle P-I, 10.16.2007)
(Roberta Romero, King 5 News, 10.16.2007)

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About The Tim

Tim Ellis is the founder of Seattle Bubble. His background in engineering and computer / internet technology, a fondness of data-based analysis of problems, and an addiction to spreadsheets all influence his perspective on the Seattle-area real estate market. Tim also hosts the weekly improv comedy sci-fi podcast Dispatches from the Multiverse.

6 comments:

  1. 1
    deejayoh says:

    Tim – you missed my favorite quote from this one -from a REALTOR®

    “We’ve enjoyed a pretty high standard of living without having to really do things differently, and I think those days are over,” she said. “We all have to really work for our money now.”

  2. 2
    rose-colored-coolaid says:

    Hmmm, incentives. That’s an interesting idea. It proves how special and unique Seattle is. 12-24 months ago, nobody in any other parts of the country thought about offering incentives, and look what has happened to their markets since then.

    But we’re different, we know about incentives, so our market will stablize this coming spring. I just know it!

  3. 3
    TJ_98370 says:

    Judging by the ads I saw in a recent Sunday PI, you apparently can still get a zero down home loan. This really amazes me.

  4. 4
    fred says:

    Oh, so they can’t make 150%-200% profit on the house they bought ten years ago? Waah.

  5. 5
    CKT says:

    I knew this market was heading to doom and gloom about two years ago. My wife and I were considering buying a home at that time. We looked at few houses in south Snohomish that fell into our price range (mid $200K). But it was one house in particular that woke me up and made me realize that things were just bat-$hit insane.

    This house was a crappy rambler built in the fifties and last updated in the seventies. The deck out back was rotting to hell, given the leaky corrugated opaque fiberglass roof overhead. The whole thing needed to be junked. But the kicker is that the old lady that lived there for 30 years kept all six of her cats in one of the three bedrooms. The cats used the entire room as their own private litter box. The smell of 20 year old cat urine permeated the entire house. It was disgusting.

    This charming POS was listed for $239K. Our Realtor, who was growing increasingly impatient with our reluctance to jump onto the crazy train, was pushing us hard on this house. He told us he was an expert on aggressive bidding, that all we needed to was to waive inspections and everything else a sane person would want before they start renting from a bank for 30 years. And to boot, he knew a guy who could easily get the cat smell out of the house.

    We told him no thanks, and please don’t call us again. We threw in the towel then and there.

    The house sold for nearly $270K after about 48 hours on the market. Insane.

  6. 6
    Scott G. says:

    TJ_98370 said,
    on October 16th, 2007 at 10:12 am
    Judging by the ads I saw in a recent Sunday PI, you apparently can still get a zero down home loan. This really amazes me.

    TJ, what amazes me is that between the Real Estate “Propaganda” section in the Paper and of course the ads of homes and condos for sale, by both weight and page volume, there are apparently more homes and condos for sale in Seattle than there is International, National, and State/Local News COMBINED! ;-)

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