A report from KTVU in California. “Bay Area home prices as well as those in other California instances, may have reached a temporary limit on what people can and are willing to pay. ‘What I’ve noticed in Santa Clara County along last year in the last twelve months, you know, prices came down about 6%,’ said Joe Velasco, an agent for Compass Real Estate in the Southbay and Peninsula.”
From KPIX 5 in California. “Despite somewhat dire predictions by the real estate website Zillow about the future of the Bay Area’s housing market in 2020, several realtors contacted by KPIX 5 says they see a possibility of a slight slowdown rather than a crash in the coming year. ‘Right now, the sellers are willing to negotiate. And you can buy a nicer home at a fair price without having to overbid’ said Sandy Jamison, the incoming president for the Santa Clara County Association of Realtors.”
“That is a change compared to recent years when buyers often found themselves in a bidding war, offering thousands above the initial asking price just to be competitive. It appears the pendulum has swung in the direction of buyers. ‘You still see it every day — people who get a property for under the asking price. You can’t come in at $100,000 or $200,000 off the asking price, but there’s still some wriggle room,’ said realtor Darius McClelland.”
From Peoria Times in Arizona. “According to RealtyHop, ‘Glendale ranked in the top 10 hottest housing markets in December, with a -1.92% change in asking price.’ ‘Peoria saw a price drop of only 1.7% —even better than Glendale,’ said Shane Lee, a data analyst for RealtyHop. Glendale ‘increased three spots to become the fifth hottest market this December,’ according to the RealtyHop report. ‘Similar to nearby cities in Arizona, Glendale properties required very small discounts from initial offering to sell.’”
“Real estate people say West Valley home sellers often get very close to — or even over – the asking price. ‘Most of Glendale and Peoria (sellers) are getting multiple offers in, which could lead to a sales price over the asking price. Or at least minimizing the price drop,’ said Elise Fay, of eXp Realty.”
“‘To talk about price drops, we have to talk about how people are negotiating,’ Lee said. ‘A lot of times sellers will set a higher price. The makes listings stay on the market longer, so you’ll start seeing price drops. Generally speaking, a larger percentage of price drop means sellers are not able to attract buyers.’”
The Sun Sentinel in Florida. “While developers are indeed building new homes around the region, many of them are pegged at $500,000 and up, not in the more comfortable $250,000 to $400,000 price range. ‘Every development I see they are building is on the higher end,’ said Greg McBride, an analyst at BankRate. In the meantime, high-end luxury home sellers have had to temper their sales price expectations by lowering their original list prices. ‘I think many of our sellers have been adjusting their prices in the last half of 2019 because many of them have been on the market for two to three years”,’ said Ron Shuffield, CEO of Berkshire Hathaway HomeServices, EWM Realty. ‘In order to attract the buyers, they are reducing.’”
“Brian Soler is a marketing executive with PMG, developer of Society Las Olas, formerly known as X Las Olas, the shared-living development in downtown Fort Lauderdale. He said his company is aiming for tenants who can’t afford the higher-end apartments that go for $2,000 to $3,000 and more. ‘What we see is a luxury oversupply,’ he said. ‘People are priced out’ and ‘can’t quite afford that $2,000-plus price point for rent.’”
The Chicago Tribune in Illinois. “A three-bedroom, 4,745-square-foot condominium unit on the seventh floor of a vintage 12-story building on East Lake Shore Drive sold Nov. 15 for $2.8 million — some 38% less than the seller paid for it in 2007. The seller, Janet Melk, formerly was married to real estate investor John Melk, who helped develop Fisher Island in Miami, Florida. On East Lake Shore Drive, Melk paid $4.55 million in 2007 for her vintage condo unit. She first listed it in April 2018 for $4.75 million. She cut her asking price to $4.69 million in June 2018 and then to $4.5 million the following month. Later in July 2018, she cut the asking price further, to $3.995 million, followed by a price cut in February to $3.895 million and a final decrease to $3.499 million in June.”
From Mansion Global on Colorado. “A large Colorado ranch that served as the location for Discovery Channel special, ‘I, Caveman, has sold for $27 million. While short of the $45 million the property listed for in 2017, the price makes the deal the largest ever recorded for a noncommercial property in Routt County, where the ranch is located, according to the agent, Brian Smith of Hall and Hall.”
“The property had undergone a price cut in early 2019 and was most recently asking $33.5 million, Mr. Smith said. He said the deal was part of a pickup in the ranch market toward the end of the year in Colorado, which faced a glut in high-end inventory in 2019. Another major property in Colorado, known as the Stealey Mountain Ranch, also sold for roughly $22 million in December, records show. The Wall Street Journal recently reported that a generational shift has led to a flood of supply of such ranches in Colorado, where some of the country’s most storied properties are located.”
From The Day. “No one buys a home believing that they’ll lose it sometime in the future. They expect, or at least hope, that regular mortgage payments and rising home values will build up a considerable amount of equity and let them reap a nice profit when they decide to sell the home. Unfortunately, it doesn’t always work out that way. Economic conditions or other factors can cause home prices to slump, leaving you with a mortgage balance higher than what you owe on the property.”
“In these circumstances, some homeowners opt for what is known as a strategic default. Unlike a standard foreclosure, where a lender repossesses a property because the borrower is unable to keep up with payments, a strategic foreclosure occurs when a borrower can afford to continue mortgage payments but decides it is more advantageous to stop them.”
“Triggering a strategic default is a rather simple process. Ana Durrani, writing for Realtor.com, says a homeowner makes the decision to stop sending mortgage payments to the lender, who eventually begins foreclosure proceedings. Julia Kagan, writing for the financial site Investopedia, says the practice has been nicknamed ‘jingle mail’ since some homeowners take the explicit step of mailing their keys to the bank when they stop paying their mortgage.”
“The most common reason for undertaking a strategic default is to escape what the borrower has come to see as a bad investment. Negative equity can sometimes amount to tens of thousands of dollars, and it will take years of ongoing payments to even break even. Allowing the property to go into foreclosure allows a borrower to use their funds elsewhere instead of putting them toward an unproductive mortgage.”
From Atlanta Black Star. “It looks ‘Love and Hip Hop: New York’ viewers aren’t buying Chrissy Lampkin‘s tears when it comes to the recent foreclosure of her home. During last week’s episode, Lampkin’s longtime fiancé rapper Jim Jones broke the news to her that their New Jersey house was lost to foreclosure. Reportedly, in 2006 the Dipset rapper took out a $680,000 mortgage for the home and promised to make monthly payments of $4,467, but those payments stopped around 2010. In September, the home reportedly was auctioned off for $100.”
“After learning of her and Jones’ mishap, Lampkin was worried that her foreclosure troubles would affect her real estate company, and she proved to be right. Lampkin was forced to face several investors in her real estate company and explain to them why her home was foreclosed. The clip showed an investor questioning Lampkin about her foreclosure possibly affecting their ‘quarter million project’ they apparently had set in stone.”
“Before the actress could respond, she broke down in tears and said, ‘It’s not like me to be irresponsible. It’s crazy that I have to sit here and explain myself to y’all over something that I had no control of, but I owe you guys that because you do business with me.’”
From CNBC on New York. “Real estate sales in Manhattan have fallen eight out of the past nine quarters, according to a report from real estate brokerage firm Douglas Elliman and appraiser Miller Samuel. The average sales price fell 7.5% to $1.8 million in the fourth quarter of 2019 and the median sales price fell below $1 million. Total sales were down, discounts were up and there is now an eight-month supply of unsold apartments.”
“Sales of apartments priced at $5 million or more plunged 38% in the quarter and there is now a two-year supply of luxury apartments on the market. Beyond the official inventory, brokers say there is a mountain of ‘shadow inventory’ — or apartments that aren’t officially listed but are waiting for market conditions to improve and sales to clear before they list. According to Halstead Development Marketing, there is a now a six-year supply of new development apartments. The biggest glut is on ‘Billionaire’s Row.’”
“While many brokers say they’re optimistic about a potential turnaround in 2020, real estate experts say they expect a continued — though perhaps slower — decline this year as tax pressures and rising inventory keep buyers on the sidelines. ‘I think we’ll see more of the same,’ said Jonathan Miller, CEO of Miller Samuel. ‘The problem with saying that 2020 will mark the bottom is that it suggests it will go up after that. And I think we still have another couple of years of moving sideways.’”