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Home sellers worry they waited too long to sell. Not until prices fall they did not. The ‘Wave’ prices are still there.

Posted by John Reed on

Yet another WSJ illogical, anti-home article, this one by Veronica Dagher. Apparently, the Journal haa a required course on anti-logic and “stick to the anti-home” narrative for all new hires to remain consistent.
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The headline today is “Home Sellers Worry They Missed Wave.”
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Did home prices fall?
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No.
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So what exactly have they missed? The article’s evidence is that nowadays sellers often have to cut their asking price more than once to sell. Did they cut it below what selling prices were six months ago? No.
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So they have not “missed out” on even one penny of equity.
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The article says the sellers may have to sell for “less than they feel it is worth.” But that is not less than the “wave” pushed it up to is it? If the wave pushed your home value to, say, $450,000, and you now sell for $450,000, you did not miss anything. It does not matter whether you listed for $430,000 and multiple bidders pushed it up to $450,000 or you listed it for $475,000 and had to cut the price down to $450,000. $450,000 is $450,000. All you missed was additional appreciation you hoped for.
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But the idea of the Journal article is that the sellers now feel they should have sold a year ago. For $430,000? Like it’s it better to sell for $450,000 after listing for less and getting bids over asking than to sell for $450,000 after several listing price cuts?
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They cite one lady who sold a home for $465,000 this summer. In March, a “comparable” home sold for $485,000. I was a real estate agent for a number of years. Sellers’ “comparables” are the one home in their neighborhood that sold for the highest price without regard to such comparability metrics as lot size, updating, etc. The national and regional statistics, which are infinitely more accurate than seller “comparables,” show NO price drop.
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Are homes taking longer to sell? Yes. Welcome to normalcy. But until the selling prices go DOWN, you missed NOTHING by waiting until this year to sell.
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Then we see the phrase “Despite the average rate on a 30-year fixed mortgage dropping back below 5%...” the home market still sucks for buyers. Well, the truth is the drop in interest rates made the same home MORE affordable, just as the recent increases in interest rates made that home LESS affordable, but like the Democrat double standard on so many things, the WSJ has a double standard on economic news. If it fits the gloom narrative, report it. If not, spin good news as bad.
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Then we have the drumbeat of “...buyers are unable to come up with the funds...” Excuse me. The homes are still selling. By definition, the buyers who actually BOUGHT the houses DID come up with the funds. Let ME use that word “despite.”
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Despite the mortgage interest rates being higher than a year ago, home prices have not declined. That is called honest reporting. How could that be? There is more to home buying than interest rates.
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Homes taking longer to sell than before is an idiotic metric. The North Star of list prices is when they are correct, the home sells in 30 to 90 days. If your home sold in an hour, your listing price was too low. If it did not sell in 100 days, it was too high. That is ALWAYS the case every minute of every day since homes were invented.
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The days-on-market metric is more accurately called the “sellers not being in touch with the current values and mispricing the listing” metric. That figure measures seller value ignorance, not the market.
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Seller ignorance works both ways. But it is sticky when the sellers are overoptimistic. Then they get childish and refuse to lower the price saying, “I’m not going to GIVE the property away.” When the seller is willing to accept current market value or more, it will sell. When the seller believes in an inaccurately high value, it will not sell.
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The article offers Realtor® advice on how and when and how much to cut your listing price nowadays. The CORRECT advice is always the same. Appraise it accurately and list it for the typical amount above the sale price in your area. In other words, if homes generally sell for 98% of listing in your area, and your home is worth, say, $400,000, list it at $400,000 ÷ .98 = $408,000.
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Is it harder to find the correct value when the market suddenly lurches upward or slows down? Yes.temporarily. But the problem is ignorant, petulant sellers, not the market.

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