More homeowners than ever are selling at a loss!
The real estate Web site Zillow.com has reported that in the 12 months that ended June 30, nearly 25% of all homes sold nationwide fetched less than sellers originally paid. Other interesting facts from this report showed:
A. In Merced, Calif., 63% of homes sold during the past 12 months brought in less than what the owner paid. Prices there have fallen 40% over the past 12 months and 56% from their 2006 peak.
B. About 63% of sellers in Stockton, Calif., lost money during the same period, 60% in Modesto, Calif., 55% in Las Vegas and 38% in Phoenix.
C. In Merced, 74.9% of sellers took a loss when they sold during the three months ended June 30 compared with just 28.7% during the same period in 2007.
What happened to all the home buyers in 2006 who thought they had gotten a great home buys when compared to the 2005 homes sale prices? From the same Zillow report we can now see the real answer to this question:
In Stockton, Calif., 2006 buyers now owe a median of nearly $171,000 more than their homes are worth. In Salinas, Calif., 2006 buyers now have median negative equity of $161,000, and in Merced, the figure is nearly $160,000.
Though not in in the report, I would venture to say that one would be hard pressed to find any 2007 home buyers whose homes are worth more today, that what they paid! San Diego California investment property sales
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I read and watch this blog regularly. Everything is almost always true … no hype about how it is always a great time to buy real estate. I’m sure this writer was realistic back in 2005 and none of his clients are in this mess. San Bernardino Attorney
We’re in one of those cycles although this one seems deeper than the others I’ve experienced in the past. Sorry to say I think it’s going to be much longer than after the election, btw, I hope I’m wrong. Hoodia Gordonii Weightloss
We’ve been through this back in the early 90’s remember. It takes a few years to recover. I see new construction slowing down which will cause less inventory and if they decide to build it will be much smaller and with more density type homes. Over building and putting people into homes they couldn’t afford was our first mistake. Acne Treatments
It’s a great time to buy rental properties. The pool of renters keeps getting bigger and bigger. Florida Bail Bonds Service
This was a good post; I am not sure if I have anything positive to say. First off, growth in home prices over the past few years was unnatural too. There were things in the mix that caused the free market system not to work, or maybe better said, “balloon.” There was government trying to create more tax revenue by relaxing monetary guidelines, the fed was keeping interest rates low on an artificial basis and then there were the promoters- Realtors, Mortgage companies, builders and the media to name a few, who pushed the notion that you could get a home for free. The risk reward portion of the equation was taken out. Now we face an industry that is broken and may not recover for quite awhile. San Diego Medical Research Studies
I’m confident that there is a silver lining in all of this. I envision that one day in the near future, we will encounter nothing but smooth transactions without all of the “mortgage drama” ….”Lender abuse”…and the old-fashioned “bait and switch” so rampant in the 1990s and early 2000s. Thank God! San Diego Cosmetic Doctor
People bought homes that they shouldn’t have, and they STILL DO. How far should the responsibility of the Realtor span? A real estate broker may have a client choose a house on the corner of a busy street in a flood zone. Maybe the house used to be a meth lab. Maybe the house has been on the market for twelve years, but this particular client loves it, despite all the disclosures and against all sound advice, and wants to buy it. Maybe the reason it’s been on for 12 years is that the seller won’t take less than full price and this particular buyer is willing to pay full price! Is it going to be the real estate professional’s fault if the client purchases the home and can never sell it again? Should the real estate professional act like God and tell that client that he/she REFUSES to sell them the house. (BTW that would be a violation of the client’s rights and a breach of agency). Downtown San Diego Real Estate Agent