From the Wall Street Journal:
Rise in Home Inventory Continues to Hurt Prices
By JAMES R. HAGERTY
June 6, 2007; Page D3
Growing inventories of unsold homes continue to weigh on the U.S. housing market, portending more downward pressure on prices, the latest data show.
The number of homes listed for sale in 18 major U.S. metropolitan areas at the end of May was up 5.1% from April, according to figures compiled by ZipRealty Inc., a national real-estate brokerage firm based in Emeryville, Calif. The data cover all listings of single-family homes, condos and town houses on local multiple-listing services in those areas.
The sizable increase is notable because, on a national basis, inventories of listed homes have typically been little changed in May during the past two decades, according to Credit Suisse Group. May is one of the peak home-selling months because families with children often aim to move during the summer vacation.
Some of the biggest inventory increases last month came in the metro areas of Seattle, up 12% from April; San Francisco, 11%; Los Angeles, 10%; and Washington, D.C., 9%.
Inventories also are up sharply from a year earlier. For the 15 cities for which year-earlier comparisons were available, combined inventory was up 29% from May 2006.
The housing market has been cooling for the past two years after a buying frenzy in the first half of the decade. Prices have flattened or declined moderately in much of the country. A tightening of lending standards has put more downward pressure on the market by making it harder, if not impossible, for some potential buyers to get credit. Meanwhile, rising foreclosures are dumping more homes on the market.
let them fall farther till it is very affordable….
Does anybody know how RE commission works .I’m working with a broker and I wanted to make a bid I know by law all bids must be submitted to the seller .I wanted to make a 475,000 bid on a 725,000 home but I wanted to specify my bid was to be (3%)14,250.00 in commission and $460,750 to the seller .She told me the seller has a signed contract to pay 6% and my bid could not be that specific seller would have to make up the difference at closing.
Simple supply-demand, prices have to drop.
Denis- If I recall from when I sold my house, there is a part of the agreement that states “you understand that if the selling broker also provides the buyer, you will pay the full 6% commish.” One of the Realtors here should know the language more confidently.
At the same time, brokers want to sell houses and if you’re the buyer the seller wants to sell to, I can’t imagine they’d piss off the homeowner and not be able to work out something. Also, 6% is higher than the standard 5% these days, so the homeowner is already getting screwed.
Good luck with the offer, I don’t know what the true value of the house is, but 35% off asking seems good for you.
Denis Says:
June 6th, 2007 at 5:34 pm
I am confused, first of all you don’t have a broker, unless you have a separate buyers broker. Second of all I know their is a rule all bids have to reach buyer, but most people will tell realtor bids over a certain amount or realistic bids and yours is a joke. You can still put the bid in directly with the owner if you want if you can find his phone number, but however if he signed a 6% percent deal with the owner he still has to pay even if you contact direct as the broker made the introduction.
Also your bid is so crazy low that unless the realtor literally tricks him into taking it no way will he accept and if you are trying to screw the broker why would he do it?
Does anybody know how RE commission works .I’m working with a broker and I wanted to make a bid I know by law all bids must be submitted to the seller .I wanted to make a 475,000 bid on a 725,000 home but I wanted to specify my bid was to be (3%)14,250.00 in commission and $460,750 to the seller .She told me the seller has a signed contract to pay 6% and my bid could not be that specific seller would have to make up the difference at closing.