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Dear Steve,
We live in the Northeast and have our home up for sale. Our asking price is now much lower than its tax value.
We've changed agents twice and had several showings, but haven't had so much as a lowball offer! If this is a
buyer's market, where are the buyers? Shouldn't this market be called something else?
-- William the Conquered
Dear William,
Good point. Yes, this market has been called many
names besides "buyer's market" by scads of frustrated
sellers, most of which are unprintable. The irony
of dubbing this a "buyer's market" without the
buyers hasn't been lost on others who've written
us in recent months. That term is a not-so-gentle,
gentle misnomer to thousands of folks who are
in the same boat as you, William.
Quite simply, supply is still way up and demand is still way down in most markets. Estimates
indicate it would take 11 months to sell all the existing homes on the market at this current snail's sales pace.
Meanwhile, we're as close to a national housing bust as we've been in a very long time in this
country. In June, the median average sales price fell again -- 6.33 percent -- to $208,600. Some are blaming the
media for setting negative expectations. But this isn't just a crisis of confidence. It is one wrought by lousy
fundamentals.
There are still buyers out there,
but they have their pick and then some. Others
are content to wait on the sidelines to see just
how low prices can go. Buyers hold all the cards
-- and most of the chips -- and are watching the
other players at the table perspire profusely.
It's all too easy to see through that old seller's
bluff that "there are multiple bidders pursuing
this deal, you know."
Some buyers are reveling in their leverage, judging by recent outtakes from real estate blogs:
"It does not matter if you offend (the sellers). In the end, they will be relieved you bought the house even if
you made their lives hell in the process," said one. "You are the only buyer, and you can take as long as you
want to buy. Your task in negotiating is to create a sense of urgency and panic in the seller," said another.
Ouch!
While sales volumes are edging up here and there, we're still crawling along the seemingly
ceaseless bottom of this cycle. Hence, the few buyers, as scarce as they may be, are calling the shots. Moreover,
many first-time buyers are being frozen out of the market because of stricter lending standards.
But let's whistle past this crowded graveyard a minute, Bankrate readers, and see if we can help
William C. more accurately reclassify this market. Do you have a clever and perhaps more accurate name for "buyer's
market"? We'll print some of the best in a future column.
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