I have been searching the web, reading the papers, and participating in this forum(a great source of information), and I haven’t been able to find any great price reductions, or bargains in the real estate market.
In a recent thread started by Mooney he described his search for real estate in his area, it sounded to me like a lot of sorting and mostly chaff, very little wheat.
In another thread Oak River Mike describes how listing prices in his area have moved down from absurd to normal, but that normal is no bargain in this real estate market.
I myself have been doing a lot of looking, and besides just doing a search for an area to find a local realtor’s website to search for listings, I watch this site, mostly HUD.
http://www.homesales.gov/homesales/mainAction.do
It doesn’t seem like there are any bargains, prices may have come down, but are still too high. it occurs to me that a lot of the gov auction homes are asking more than they are worth, and need lots of work. I am thinking this is what Tim Mooney was finding, and commenting on.
I am expecting to find good deals in areas where there are lots of listings, it seems like the more listings there are, the more the prices have come down. still no bargains though, areas like Las Vegas, Florida, Arizona etc. where listings are in the thousands for a city/area/neighborhood, they have come down but I think are still to high, and I can’t be sure without some local perspective. I have tried cross checking between the local realtors and the gov auction site, it occurs to me that when the locals are less than the gov HUD prices there may be bargains.
Anybody got any good feelings about an area, or is it all just gloom and doom. any thoughts on how far away the bottom is for a particular neighborhood? when I do find what I think may be a good bargain it is usually sold, how or where can I check real estate sold transactions, is this not public information? do I have to go to a realtor for checks of comps? how can I do this myself, or check the information the local realtor is giving to make sure they haven’t missed anything?
I am hoping this thread takes on a life of its own, as a kind of ongoing report of what is happening where, from the locals perspective. I recently moved from southeastern north carolina to mid missouri (for a job) and I can tell you that both areas are still overpriced, with the occasional bargain the only thing selling.
Replies
You're in the Carolinas one the last places to get hit. Everybody I talk to says you're still going strong in that area.
You want cheap? Come to Metro Detroit. Bring beads and $24 you'll do better than the deal had on Manhattan island from the indians.
They're giving MI away and i'm stuck with what I have cause I cant get liquid!!
i moved away from the carolinas for a job, and although in general the state may be better than most, where i was at on the south eastern atlantic coast we took a huge hit. the overspeculated coast prices plummeted, construction stopped, and very little if anything is selling.
it certainly has more to drop before it is time to buy there.
where i am at now in mid missouri i have been looking for property but haven't found any bargains. when a realtor asks me what i want i say the most important thing is value, so that if i need to get liquid, because of another job move (inevitable) or investment opportunity, i will be able to.
the fixer upper houses in town won't be worth what they cost to fix up, and the country property sells if its priced right but very few people are anxious to sells it seems.
you say they are giving michigan away, has it hit bottom? is there more room to go down? if it is at bottom, don't you think money and people will start coming back in? you are in the neighborhood, what is your feeling on it? how can you tell when your neighborhood is improving, when less people like you feel that they are stuck cause they can't get liquid?
i don't want to invest there when you are looking to leave. when others are starting to come thats when i want to get in.
"you say they are giving michigan away, has it hit bottom? is there more room to go down? if it is at bottom, don't you think money and people will start coming back in? you are in the neighborhood, what is your feeling on it? how can you tell when your neighborhood is improving, when less people like you feel that they are stuck cause they can't get liquid?"
So you want someone to guarentee your investment and rate of return? How on earth would anyone know when it actually hits the true bottom?
People won't return to buy real estate until employment returns, not low real estate prices. In my area the properties market wide are down 15% over last year. So some are probably selling for 25% less while others are sold for 5% less as the 15% is an average.
I just bought in Michigan and it looked like the price was about 20-25% below market from 2 years ago. But these numbers are nothing more than historical reference. You seem like you are waiting for a guaranteed number with proof that it is at the bottom of the exact type of home and neighborhood you prefer. A difficult find at best.
Your statement that you still think the numbers that have dropped are too high in your opinion. Is that an opinion, your comfort zone or based off of figures from some time era? Just because it feels uncomforable to you doesn't make it bad deal. In the 80's in my area I could by a house a month for 10k ish. Now 25-30k. So because they haven't fallen back to 10 should I not buy? The issue is will it appreciate in the given time you need for your investment purpose. And at the correct rate of return. It is the same as everyone talks here on the board about being in the contracting business. You have to know what you need before you can bid correctly. DanT
Agreed. I have a millionaire friend who recently went bankrupt in MI. We talked about the opportunities in MI real estate and he left me with this gem: "Never buy in a falling market....you don't know how far it will fall." He went on to say that once the bottom hits and the rebound starts, you'll probably be buying at the same price you would have, because it's only luck to buy at rock bottom. But, the difference is that when the rebound starts, it usually continues...especially if it's coming off a long plunge like MI has experienced. I've been predicting that MI would be at 50% of it's peak value before things turned around. In many neighborhoods, it's at that point right now or approaching it. There's far too many bank owned properties for it to rebound just yet so everything might drop quite a bit more than even I predicted. I'm still trying to sell some lakefront property (yes, it's dropped in value too). My realtor told me that no one is walking in and looking for anything other than REO properties and the offers are coming in at 50% of the asking price on them. She's been a successful reator for decades and she said that she's never seen anthing like it. Even if we sell our property here in Austin, which experienced appreciation last year, I'm on the sidelines. I don't trust the market because I feel like the losses from the foreclosures will collapse the ability to lend far more than we are being led to believe. Without funds available for lending, I suspect that we'll see very high rates like we did in the early 80's. I hope I'm wrong. Bob's next test date: 12/10/07
We are finishing up the Michigan purchase. Money is getting tougher to get. The bank wants an enormous amount of justification, even with liquidity that would buy the place at 100% and a high credit score. Sign of the times I guess. We did get it done for a fixed 5.625 but I am begining to think I was lucky.
I think you friend is right. It is like when to buy stocks. The bottom is elusive, but on the way up you are almost asured a profit. Maybe not one to brag about but a profit none the less. But we both know the money is made on the buy.
I am sorry to hear of your property. I thought you had said it was gone some time back or I would have asked about it. Hope Austin treats you well, it is a beutiful city. DanT
5-5/8% fixed is a great rate. Where'd you buy, out of curiousity? I lived in Ann Arbor 25 years and have been to a lot of the lakes around there.
Gladwin County. Just below the intersection of 31 and 61. ( I think lol, still get lost occasionally)
It is located on the Molasses River. Nice property, nice house, wooded, etc.
As I told my brother there are only about 30 houses in the area, you can't see the house through the trees from the road, it has cable and high speed internet and yet when you go outside you feel like you are in the woods. We are pleased. DanT
I shot my first deer in Gladwin, S off 61. I loved the wildness of Gladwin. Bob's next test date: 12/10/07
I've still got three lakefront parcels. I'm okay if they don't sell. The taxes will only go lower! We've got a spec (flip) standing in Austin. We just dropped it to 624k. I hope we can move it at that. Heres a link to the website the realtor set up. http://www.1006avondale.com/ Bob's next test date: 12/10/07
Wow your house looks fantastic
Yes, thanks. Frank did a fantastic job on it. It was a wreck. I'll look for some before pics. Bob's next test date: 12/10/07
Looks good. The pics on the website are too big. I lost patience about 10 seconds after clicking on the second one.
I never thought about that. I doubt that the realtor is designing websites for dialuppers though. Bob's next test date: 12/10/07
Who's on dialup? The opening image of the exterior of the house is over 2MB, about 20x what it should be.
Nice house! Looks like good work. A flip huh? Looks like the ones on tv lol. DanT
Do you have any befores of the spec flip?
Best of luck, around here we got more homes then buyers.
Election year, Carter Economy, gas, jobs & war.
It can only get better.
I live in a four-bedroom lakefront house in Michigan that I paid 400K for in 2001.
If you drive out my driveway and cross the street, you will be in the driveway of a forclousure that until last week had boards covering the broken windows and doors. It was listed for 220K or so.
Wonder what mine's worth now?
Kowboy
I'd guess yours is worth 275 tops. What do you think? Bob's next test date: 12/10/07
It may be a moot point, as we have no plans to sell.
Kowboy
Wow, what a difference. And you got to do it all in warmth vs 3 ft of snow. There has to be some value to that! DanT
Dan, that project was our easiest winter project EVER! Of course, our suffering time is now upon us...it's been in the upper 90's last week and today. I keep thinking about getting my AC fixed in my truck...On ironic thing: the locals here shut down in winter because it's too cold! LOL! I've actually heard some of them say "we'll build it when the weather breaks". Hahahahahahaha! Bob's next test date: 12/10/07
Blue,
The 2 story house at Travis and Riverside is my son's.That is a very interesting neighborhood. I love walking through it and looking at all of the different remodels and original homes. I guess the term is eclectic.Pete
Edited 5/28/2008 9:33 am ET by gotcha
I'm one house east of travis. I'll check it out the next time I drive by there. Bob's next test date: 12/10/07
sometimes there is a certain bliss in ignorance.
Heres the before pictures. All in all, it was dreadful. Bob's next test date: 12/10/07
wow you sure did a nice job.
Very nice work! A good Realtor should be able to roll it over for you reguardless of the current market. How many months did it take to remodel?
We have been building new 1900 sq.ft.on the weekends for the past 21 months part time on & off. I think the next one might be a fixer.
I believe it was 4 months. Our original estimate was 2.5 months and we lost quite a bit of time early, middle and late simply because we didn't understand the Austin process. We're confident that we could pare it down to 3 months but 2.5 might be too aggressive. That would be my goal though if, and thats a big IF, we did another.I said earlier, I have no confidence about the market. I'm on the sideline unless I find something that is screaming profit and fast turnaround. Bob's next test date: 12/10/07
not looking for guarantees, just looking for perspective from a local point of view. am i wrong to discuss in here how to go about getting a great deal?
in coastal north carolina prices have come down but will come down more i think. nobody is buying so lots of other folks think they are coming down more as well. i think that when i see prices low enough it will start to move again. basically i am asking if you agree with above mentioned assesment, and do you think its low enough that it will start selling pretty soon, or will it have to go lower in order to move.
yes its my opinion that they haven't dropped far enough yet, listings not selling is what i base the opinion on. i think everyone can agree that it is a good deal if you can immediately turn around and list it and sell it quick for what you paid for it. granted you will lose money doing that with associated fees and commisions etc. but the point is there are several people willing to buy at that price. in other words, not just my comfort zone, but lots of peoples comfort zone.
Nothing wrong with checking for opinions or info. I just read into your post you were looking for someone to say "this is it!! the bottom and it is here in my state, buy now!!!". So if I misread the intent I am sorry.
What are your trying to buy? I am more inclined to use a realtor if I am in a new state and don't know the laws. Jim studies more than most and has more b#lls than I. But MLS is still good info and most will also offer some insite as to what is happening.
If I am using a realtor (as I just did) I always look for property that has been on the market for a year or more, preferably has been owned by the same owner for more than 5 years so the mortage isn't too high and has the price reduced once already. That always narrows the field. I still look at others for comparison.
The Michigan property I spoke of was on the market for 11 months, the owners had owned it 25 years and they had reduced the price once. I offered 25% less than the current asking price and wanted them to leave all the furniture, yard equipement and appliances. I felt since it was a weekend place for them also that would be a good place to save money. All said and done we saved 19% and got everything else except the new riding mower.
Good deal? We got what we were looking for at a price we couldn't touch in our area for 50k more. So we are happy. Would I have paid that and made it a rental or flip..............nope. So it does depend on what you want to do with it. DanT
thanks for the reply, i am trying to get peoples opinions of values in different areas. i would love for someone to say thats it, its bottomed, heres why, and come buy some. i don't think that will happen, but it would be great if it did.
i think there are several areas where there are so many listings, many of them held by banks or freddie mac or fannie mae, that prices will move down to the point that there will be many bargains,
and if i do find one of those areas that are on the upswing i would not hesitate to tell others. the more people coming in and investing in the neighborhood the better. so far though, i haven't found it. i will keep looking.
it sounds like you got a great deal, and a great home.
It is rare indeed that you will find a "bargain" if you are talking to a realtor. Everyone that lists with a realtor gets the same treatment: the realtor wants the listing and part of their sales pitch is to pump up the value of the listing. If it's truly a bargain, most realtors will buy it. Did you ever wonder why so many properties are for sale and they say "agent owned"? They buy the deals themselves...they don't list them. If they are tapped out, they refer the deal to someone in their network and it's bought direct and a referral fee paid. Your quest for "bargains" needs to be focused on properties that haven't reached the MLS. Bob's next test date: 12/10/07
I'm not looking to leave. If I could get liquid I would buy like crazy up here right now. If I had the 50k i'm looking for i'd be with a realtor right this second.
As far as hitting bottom, I dont know if anyone really know where bottom is but I have to think it cant be far from here now.
segundo
Our county realtor's multiple listings have a website where you can search listings.
Also the county assessors office has their public records online so you can check for properties that have been sold.
On that site you can look a property for sale and get alot of information. Assessed value, SF, picture, amount it was sold for 2 or 3 transactions ago.
Do a search of your county and you should be able to find this information.
Once a realtor or a bank knows you are serious about buying property they may feed you some leads. Often times a bank will want to unload a bad loan. But they have to know you and know that you are a good risk.
Rich
thanks cargin, i have found our county's web site, and they don't have the "sold" information. i guess different information in different areas. i was able to find some tax info, i will search further.
segundo
That is public information.
You can go to the courthouse and ask for the record on any parcel in the county.
Rich
"That is public information.You can go to the courthouse and ask for the record on any parcel in the county."The information is only public if the county collects it..
.
A-holes. Hey every group has to have one. And I have been elected to be the one. I should make that my tagline.
Jackson county (Kansas City) just added prices on sales.But it is a part of the tax part of the system. Not the recorded deeds.But IIRC that was done with by laws pasted by the county legislation. And there is no state requirment to give prices on sales.And a friend of my is a RE agent. IIRC she says that the recorded sale price is not always that meaningfull. That for comparisons she looks that the MLS data (if it was a MLS sale) and it shows if there was any seller contributions or closing cost wrapped into the sale.Probably the best deals or on semi-abandonded property.Inherited by out of town heirs, old people that have going into a nursing home etc.But they are hard to find.One way is to look for unkept properties and then look up the owner and the address where the tax bills go to. That will often give clues as to if they are out of town owners, any mortgage on it, etc..
.
A-holes. Hey every group has to have one. And I have been elected to be the one. I should make that my tagline.
The chances of finding a house at a bargain are slim.
They have Mortgages on them and if they are in distress, there is probably little equity to bank on so a short sale is a dream.
If it was a good deal? The realtor would have snapped it up.
Land on the other hand? Lots of it is owned outright or was purchased by a builder/developer/speculator who now needs out.
Never found a house bargain. Found a few land deals that made me money.
thats a good idea robert, thank you. i will think of that while i'm looking now.
previously i too made a good profit on a raw land deal, i had hoped to build there, but changed direction and ended up making money just on the land.
I like the fact you are trying instead of sitting on your butt talking about it . Youre half the way there .
I think if you read back which Im sure you did , youll find all the ways I know to find property.
That doesnt mean you can find your own way for your area. Thats what you might have to do. Some of this stuff I do wont work other places so Ive been told . Markets are different 20 miles down the road .
The first thing you will have to do is learn your values on the properties you desire. The only way to do it is study hard like you were gonna take finals . Reading never stops for gaining information. Then you wont "think" somthing is too high or too low . You will know and be able to pull the trigger on a decision. Thats first . Youre doing the right thing looking but while youre doing it make notes. Thats how you learn values.
I gotta go pick up my son.
Tim
thanks tim, i learn a lot reading in here. i can eliminate a lot of them very quickly, but pulling the trigger, still a little gun shy.
thats why more research. i am glad you are here and posting, and i will definitely take notes.
You will probably need the help of an agent . They have access to their MLS system which stand for multiple listing service . Here is means all the listings in the county. It will have "solds" for at least three years back . They will do it for you for free but dont misuse it to much or they catch on very fast .
Target the type of house you want . Look at the hoods you desire . Learn what they list for as I use Realator.com which has all my listings . That should give you an idea of what they are being listed at . Then drive by some . You cant look inside with out an agent but the outside tells partially what the inside should be . You need sq footage off the adds . When you know that and pick a property you want to ask about the agent will show it and run comparisons on the house for you . You need them all in your hand to study. Ask for a pile that consists of everyhing in sq ft , price range of what you asked about . Also ask for solds back the last 12 months. You want to hold them all in your hand . Dont take his or her word for anything. Its your money and they want some of it . Thats how it works .
If you go that far youve passed your next test . You know what you are looking for is listed at and what it sells for for the next 3 months pretty close. Now you know that part .
Tim
i live in coastal RI... here... the waterfront homes are all over $1 million
anything with decent views go to $3 million.. and some sales are over $12 million
water view can bring a million
those sales take less than 6 months .... and the prices have not fallen
lowest priced homes in town now are say $250K
down from say $400K
our home is in the $600 to $900 range... so two years ago it would have sold in a month at $800K... now it would take 6 - 9 months and probably sell for $669
our thought is the market will turn in about 2 - 3 years ..... no matter what
and the prices will be back to where they were two years ago...
based on demographics and the lack of housing inventory in desireable areas
we are close to the NYC market and there are only so many places that those with money can actually buy something
of course.... $1 million three years from now will be worth what ??????
$700 K
thing is real estate seems to be the only thing that can keep pace with inflation
so i'm only willing to sell at inflated pricesMike Smith Rhode Island : Design / Build / Repair / Restore
thank you sir, i appreciate the reply with insight of R.I., and concur with your opinion.
Mike Smith,
Funny the lake here is similar.. a million+ is a starter home.. and prices haven't dropped significantly. Oh a few home sold at distressed prices last winter due to moves etc.. but they were quickly purchased by speculators.. while off the lake prices have declined by an average of 19% in the 7 county metro area. Minnesota mainly the metro area has a record high number ifhomes in foreclosure.. 3.39% compared to a national average of 3.62%. That's the first time that Minnesota has suffered such a fate.. usually we lag the nation in negative reporting..
Nation wide New home starts are at a 27 year low however percentage wise Minnesota has never seen this few of starts or this severe of a decline..
thank you for your posts, good advice.
in your post to mike you talk about how prices stayed on the lake, but fell off the lake 19%, and that this is the first time for minnesota to experience this.
did the off the lake prices, and the rest of the state experience the dramatic increases before fall 2005?
i saw real estate go nuts on both coasts, and it seems like the only places it didn't go down are extremely high end, and areas that didn't go up much at all (cheap rural acreage)
Segundo,I think I either mistated it or you misread it.
Prices on the lake are steady after raising at astonishing rates for the past 5 years. However prices for the metro area have fallen 19%.
The old realitors saw, location, location, location applies..
Minnesota has a broad diverse economy and we aren't being impacted as much as some locations are.. with the currant economic downturn..
However we are massively over built. There are an estimated 28,000 new unsold properties in excess of one year old in the 7 county metro area up from around 25,000 last year.
Add to that those attempting to sell existing property to take advantage of new property at distressed rates. Plus foreclosed property and there is a glut of property on the market..
Yes that is true, high end (lakeshore) prices are steady while subsuraban and city property took a significant hit in the last couple of years..
Rural property has gone up dramatically for a differant reason. Land that wasn't being farmed anymore is suddeningly in demand as corn acerage. With Corn prices at record highs old abandoned farms are being purchased and planted driving prices for farm acerage up to new high levels.. Minnesota is in the heart of the corn belt and we have ready access to markets for that corn..
Tim is right. Know your market. Not think....KNOW! Then, when you find a property that has the right numbers, you won't need to be gun shy. The numbers will be great enough to pull the trigger without hesitation. It all starts with knowing what the FIXED UP MARKET VALUE is of the neighborhoods you are shopping in. Look at the last years sales. Look at the last three months sales. Look at the last months sales. Look at the average days on markets. Look at the amount of product for sale vs the average day on market. All those numbers tell a story. If things are taking 120 days on the market to sell...you better have your finished product for sale at 85% of the average asking price. Yours will sell first. Work backwards from that number. Subtract the fixup costs. Figure what you want to make (30% minimum). That's your offer. Make lots of offers that are so low, you are embarrassed. If you are not embarassed, you are offering too much (been there done that). Bob's next test date: 12/10/07
thank you, excellent advise. i need to improve my research with solid numbers of previous sales. i will do that.
i also think your austin house looks great, was it a total tear down?
No, we intended to leave all the lower walls. That didn't quite work out and we had to rebuild the left side. Money wise, we probably should have bulldozed it. That would put us in a different permit process though. Bob's next test date: 12/10/07
i saw that in california where they were trying to restrict building, one place the only wall left standing was a three stud interior closet wall, while the new house was built all around it.
i don't mind doing that hand demo stuff too bad, just have to be patient. unfortunately time is money.
segundo,
Sorry to come in so late,, You need to look where reposessions are high and be prepared to deal..
Minnesota for example has a 2.22% loans in foreclosure rate compared to the United states average of 2.04% and a midwest average of 1.43%
That's out of a total inventory of 3.39% of loans over 90 days late.
Banks when they list homes seek to get even from the loan.. However when the home fails to sell in the auction a quiet conversation with the bank will often yield a price significantly lower..
When I bought my home 21 years ago the bank was asking $185,000 for it.. I bought it at $107,000
I frequently hear similar numbers currantly. Homes on the market at $450,000 sell for $260,000 when the dust settles.