A report from Inc Magazine. “To find the most overpriced cities, GOBankingRates combed through data on the nation’s 722 biggest housing markets, comparing median listing prices in 2019 (through November) to Zillow’s estimate of median home value, which is based on actual sales. Then it identified the 50 cities with the biggest difference (in dollars) between the two. What does it mean when homes in a city are being listed for much higher prices than they’re actually selling for?”
“A third possible explanation is that prices in your market are falling, or about to start falling. Realtor.com noted in May that, although average home prices in the U.S. were up for the previous 12 months, one in five American cities was seeing falling prices. In some cases, such as San Jose and San Francisco, the price drop simply reflects the fact that prices in recent years had risen to stratospheric levels that–not surprisingly–proved to be unsustainable.”
“Like much of the San Gabriel Valley, Arcadia benefited from a lot of foreigners buying U.S. homes. The area has been especially popular with Chinese buyers. But a slowdown in China’s economy combined with the trade war and anti-immigrant rhetoric in the U.S. has slowed China’s Southern California buying binge. It also means many of the homes purchased by Chinese nationals now sit unoccupied. According to Redfin, home prices in Arcadia have fallen 10.7 percent since last year, and homes take an average 67 days to sell. Rather than buy a home in Arcadia, it might be worth trying to get one of these absentee owners to let you house-sit.”
“‘It’s Now a Buyer’s Market in Manhattan Real Estate,’ declared a New York Times headline in October. The story went on to say that a decline in foreign buyers along with a new tax on luxury apartment purchases has cooled the real estate market there, bringing prices down by 8.2 percent compared to a year ago.”
“It’s clear that the real estate market in Dallas has cooled, although it’s not clear whether that’s just a reversion to normal pricing or something more. Redfin figures show that Dallas home prices have fallen a precipitous 39.7 percent since last year, whereas according to a D Magazine piece published in July, prices are still increasing, just more slowly than before.”
From Bloomberg. “In the mid-1990s, a wealthy family commissioned architect Steven Holl to build a country house on 33 acres in the Catskills. The result was a bright red, 2,900-square-foot house in a Y shape that cost about $1.3 million. Eventually though, the family began to spend all its time in Europe. It decided earlier this year to put the house on the market. Its asking price is $1.6 million, or about 20% less than was poured into the property 23 years ago.”
“Raj Kumar, a broker representing the property, and the owners of the property are encountering the sobering reality of selling a ‘starchitect’-designed home: They might have gotten what they paid for in their house’s dramatic lines, luxurious materials and prestigious pedigree, but when it comes time to sell, the market is often unforgiving.”
“Unlike most houses that languish on the market, many of these properties are not examples of faulty design, undesirable markets, or owners with unreasonable expectations of making a large profit. Instead, in multiple instances, sellers often hope simply to recoup their building cost. In other instances, it’s not a question whether homeowners will sell for less than it cost to build the house; it’s how low they’re willing to go. Take a 10,561-square-foot house designed by Rafael Vinoly in Ridgefield, Connecticut.”
‘The house’s original owner spent more than $25 million between design and build,’ says Laura Ancona, a broker who represents that home. When its original owner died, her heirs left it to Fairfield University, which, after a few years, put it on the market ‘and sold it for a fraction of its value,’ Ancona says. The closing number in 2012, according to Zillow, was just $2.7 million, well below the listing’s initial asking price of $10 million.”
“The property’s buyer quickly put it back on the market for $25 million, presumably in the hopes of making a quick profit. It failed to sell. Now it’s back on the market – this time including an adjacent house on 11.23 acres for a total of $9.75 million. ‘When we listed it for $25 million, it was indicative of what (the seller) would have parted with it at the time, and now the price is indicative of his increased motivation,’ Ancona says.”
“If the house sells for its current asking price, it will have lost more than half its value in 30 years, and that doesn’t factor in any value for the second property thrown in.”
From Patch McLean in Virginia. “This architectural masterpiece in McLean could set the standard for fine homes in the region. According to the realtor.com listing, the Peacock Estate may be nearing a sale. HUGE $1.5M PRICE REDUCTION! Priced to MOVE IN for the holidays! MOTIVATED SELLER.”
From 6 sq ft in New York. “So what’s in store for the year ahead? ‘My overall feeling about 2020 in terms of real estate is to expect more of the same in 2019, with perhaps more hesitation to pull the buying trigger. Oversaturation of unabsorbed inventory with more inventory to be released will lead us to inventory sitting on the market. I think things will hold steady and remain a buyer’s market. I find there is lways uncertainty around an election year, no matter who is running. I think this will cause a lot of buyers to sit further back and wait to see how things shake out’, Jessica Swersey agent with Warburg Realty.”
“‘Inventory will tighten as the amount of pipeline supply has slowed several consecutive years and inventory will hold pricing as a result. However, I think concessions will continue to sell off the ‘panic inventory’ and this could have a long-lasting impact,’ – Josh Schuster, principal of Silverback Development.”