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Investor sales always
slow to a crawl in the summer months because the homes are all rented
for the summer season, as soon as September came the investors
returned again, albeit in fewer numbers. Prices fell in 2006 and
they fell a little after summer 2007, but I don't see listed prices
dropping much more these days - I
think we are at the bottom of the price reductions- or very close. What
is happening is that sellers are accepting lower than listed
offers, but they are not taking the very low offers many buyers are
offering - there is a limit to what they will sell for because most are in rental programs making good money from May to Sept and rental income has just gotten better and better over the past dozen years. I have been seeing accepted offers of 5-10% below list
price, offers below that are just being rejected. Remember - these
listed prices have already come down so even paying close to full
price still gives you a huge reduction in what they were selling for
2 years ago. Most sellers are not suffering because rental income was
strong this year and these owners are not hurting for money anyway,
they want to sell but they are only going so low and not below their
bottom line and there are not many foreclosures on investment homes.
What
does the future hold? I have seen 3 cycles of real
estate in my 21 years of selling homes and I see 2007 just about like
it was here in 1993-4. The prices had peaked in 1990, just like
they did here in 2005, and from 1995 to 1999 the prices were steadily
rising. Investors are telling me they think we are at the bottom and
with interest rates DROPPING they feel they can't go wrong
now. Finding an 80%LTV loan at 6% is not hard - even after the
subprime market collapsed.
I think you will see investors coming in
to buy homes and I have already seen many 2nd home buyers jumping in
with these lower prices and attractive 30 yr rates. February through spring is
always our strongest selling season because the rental incomes start in May and I predict the saavy investors will be out as soon as it warms up here - March and April.
In other words - buy now
or very soon.
Tim Moore
Broker/ Sales Mgr
Joe Lamb Realty
Tim@joelambjr.com
800-552-6257 ext 234
3-12-08
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