Why can’t I get a killer deal, if the media says houses are selling for pennies on the dollar?
Friday, February 26, 2010 |
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Our main issue is that there is not enough housing for the amount of buyers that want to purchase. Because Real Estate statistics are hyper local, any general statement that has as its basis a global statistic for the United States, has little to zero relevance to our Bay Area RE. In Detroit you can purchase a single family home for $59,0000. In the Bay Area, that will buy you a large, newer vehicle or old trailer- not even a financeable mobile home….
New construction in the Bay Area is not selling like hotcakes due to the difficulty of obtaining financing, not due to lack of demand. We have a MAJOR stumbling block right now in the financing process which is the new appraisal rules & regulations- the amount of war stories are mounting and unfortunately we are all getting wounded by it! These new rules have left us with very few good appraisers that are intelligent, professional & discerning and instead we have a bunch of uneducated, unmotivated, & unknowledgeable people that are willing to work for $125 for over 20 plus hours worth of work! These are the folks that are stopping transactions from going through. But then, we’ll talk more about that later….
As a secondary problem for new housing- which is just getting started- is the Chinese Drywall issue www.newsinferno.com/archives/5591 (just an example).
Indicators that ARE important are:
2/21/09 1,375 Properties available for sale in Santa Clara County 28.1% were in escrow
2//10 760 “ “ “ “ “ “ “ “ 59.3% are in escrow
But even these stats are not totally correct due to the amount of Short Sales that are under contract/in escrow that will NEVER close escrow and will end up back on the market as Foreclosures…..
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