Seeing massive price drops in Nashville and motivated seller behavior. Working an upgrade client right now…we go under contract w sale of home contingency to purchase a high end east Nashville rehab. List my client’s home…three weeks no showings. Seller’s agent on the high end rehab calls and says seller is financially strapped (poor cash flow mgmt will lose the rehab to foreclosure end of year…must have a hard money loan). They offer to lower the agreed contract price to what is needed so my client can lower their home listing price. We went under contract today on the listing side. Never would have happened without the motivated seller. Great time to buy if you can stomach the rates. Make low offers if you’re a buyer in this market!
Wow! What a story. I'm glad you were able to find a path forward. Yes, I agree. It's an excellent time to either have cash or a whole lot of trust in the market's ability to rebound, and I suspect that for individuals like this it's only going to get better for the foreseeable future. I must say I'm very glad that home sale contingencies are back on the table- makes things a whole lot easier and less stressful for buy/sells!
I suspect you’re right about median price declines, Kira. Of course, that’s going to be different in every market but, for what it’s worth, the median sales price in the greater Chattanooga, TN area dropped 8% from June to October. The 20-year average, taking into consideration declining values throughout the fall, is 2.6%. That tells us something. Great article! I was looking forward to it.
Models that look at Rate of Change in Homes Under Construction vs. Rate of Change in New Homes Being Sold show the largest increase in that ratio since the 1970s
GFC: 75/80% increase in rate of change
Now: 185% - more than double anything seen in the last 50 years
Sellers can also feel trapped, if they sell their home where are they going to move and how expensive is it going to be for them to buy a new place? I think the market is going to be very stagnant for a while, then I see short sales coming. Learn about short sales. It’s going to be a while but it’s the only way the market is going to start moving again. The government needs to come up with a debt relief program like they did during the last real estate meltdown in 2006 2008.  The Fed got us into this mess, but we’re going to have to muddle through it to come out better on the other end. 
Government come up with debt relief? Grown adults made purchases. They need to live with the consequences. Don't get me started on other bail-outs. People need a little road rash from bad decisions. Good judgment comes from experience. Experience comes from bad judgment...
Debt forgiveness is simply a nicer name for bail out, but it is still a bail out! People got over-extended based on what they thought were "normal times". They were anything but normal, and folks should have realized this. We all learn from our mistakes, I do often. But, the fact is, take responsibility for your actions and don't go crying for someone to save you from that poor decision. You'll never learn that way. One rule of thumb I always have when buying property is, have a holding period in mind of at least 10 years to ride out the cycles should I make a poor timing decision. The second rule is to always buy in a place I'd be willing to live should the market fall out from underneath me.
Seeing massive price drops in Nashville and motivated seller behavior. Working an upgrade client right now…we go under contract w sale of home contingency to purchase a high end east Nashville rehab. List my client’s home…three weeks no showings. Seller’s agent on the high end rehab calls and says seller is financially strapped (poor cash flow mgmt will lose the rehab to foreclosure end of year…must have a hard money loan). They offer to lower the agreed contract price to what is needed so my client can lower their home listing price. We went under contract today on the listing side. Never would have happened without the motivated seller. Great time to buy if you can stomach the rates. Make low offers if you’re a buyer in this market!
Wow! What a story. I'm glad you were able to find a path forward. Yes, I agree. It's an excellent time to either have cash or a whole lot of trust in the market's ability to rebound, and I suspect that for individuals like this it's only going to get better for the foreseeable future. I must say I'm very glad that home sale contingencies are back on the table- makes things a whole lot easier and less stressful for buy/sells!
They say each percentage point and interest rate causes a 10% reduction in value in on average without mitigating factors
I suspect you’re right about median price declines, Kira. Of course, that’s going to be different in every market but, for what it’s worth, the median sales price in the greater Chattanooga, TN area dropped 8% from June to October. The 20-year average, taking into consideration declining values throughout the fall, is 2.6%. That tells us something. Great article! I was looking forward to it.
Great article. Thank you.
Models that look at Rate of Change in Homes Under Construction vs. Rate of Change in New Homes Being Sold show the largest increase in that ratio since the 1970s
GFC: 75/80% increase in rate of change
Now: 185% - more than double anything seen in the last 50 years
Suggests a BUST in housing construction.
Sellers can also feel trapped, if they sell their home where are they going to move and how expensive is it going to be for them to buy a new place? I think the market is going to be very stagnant for a while, then I see short sales coming. Learn about short sales. It’s going to be a while but it’s the only way the market is going to start moving again. The government needs to come up with a debt relief program like they did during the last real estate meltdown in 2006 2008.  The Fed got us into this mess, but we’re going to have to muddle through it to come out better on the other end. 
Government come up with debt relief? Grown adults made purchases. They need to live with the consequences. Don't get me started on other bail-outs. People need a little road rash from bad decisions. Good judgment comes from experience. Experience comes from bad judgment...
It’s not a bail out, it is just debt forgiveness. There is a difference.
Debt forgiveness is simply a nicer name for bail out, but it is still a bail out! People got over-extended based on what they thought were "normal times". They were anything but normal, and folks should have realized this. We all learn from our mistakes, I do often. But, the fact is, take responsibility for your actions and don't go crying for someone to save you from that poor decision. You'll never learn that way. One rule of thumb I always have when buying property is, have a holding period in mind of at least 10 years to ride out the cycles should I make a poor timing decision. The second rule is to always buy in a place I'd be willing to live should the market fall out from underneath me.
Thanks for your blog, Kira.