It’s been a month since my last post, and we are now seeing the results of the tax credit on the Real Estate market place. Sales have dropped 30% since the expiration. The closing dates have been extended so those who did purchase through the hype can arrange to pay back that $8K tax credit over the next thirty years. Prices are also dropping.
What we have seen is that more properties are preparing to come onto the market. Essentially people are spending more so they can sell for less. Your property needs to be in top condition for buyers, qualified buyers, to look at it seriously. You also need a qualified Real Estate agent to move you through the process.
I have been surprised by some of the agents who are doing well in today’s market place. Actually it is more surprising that some of the agents that I truly respect and admire are kind of floundering. Experience really is going a long way in getting a property sold today. Experienced agents are bringing more to the table.
If you are a buyer you have some very difficult choices to make. The easiest choice is to wait. We’ll see if the government will interfere in the Real Estate market place again, but I sincerely doubt they will. In my opinion it will be next November before we see stability in the Real Estate market place.
Goldman Sachs published an opinion about Real Estate pricing last month that was hotly debated. It projected another 22% decline in Real Estate prices in Seattle. The first leg down will be before the end of the year. We should see that by November.
We already have seen the drops in condo pricing. It seems a $100K drop is the most common in the $300K to $650K prices. For me the $500 a square foot is kind of hard to imagine, but it is what it is. Down Town condos, for me seem like an excellent position to be in, at the right price.
My point about condos is that residential Real Estate won’t be far behind. This year we will see prices dropping more steadily as the sales data becomes more in line with value. The real trick will be to qualify for a loan, but that will be a post for another time. The theme today is the waiting.
