Numbers Have an Impact
October 13, 2009
I post numbers such as yesterday's median prices or the past month's transactions in the local real estate market. I share the data with my readers in the belief that the numbers can indicate how the real estate market is trending. These numbers do impact buyers and sellers, but they are always about the past, not the future. Unfortunately, because they can influence the decisions that buyers and sellers make, they they do impact the future.
A buyer, watching the value of homes decline, very likely will make a low offer for a property.
A seller, since the numbers show a slight uptick in median prices, may reject a low offer and lose a sale.
Both parties to a real estate sale need to adjust their expectations to reflect the current home values in the local market. The sale of property has typically occurred after successful a negotiation that arrives at a price that each can accept.
This is a market that is influenced by the numbers. Buyers and sellers are at the mercy of lenders. An appraiser evaluates a property based on homes that have sold in the past three months (the past). What has helped future numbers (selling prices) has been the sale of properties that have attributes other than just a low price (location, condition, amenities) and for which a buyer is willing to pay more, if necessary, to be the successful purchaser.
Other numbers that are impacting sales are the $8,000 tax credit for first time home buyers and the lowest thirty year mortgage interest rates. When 62% of persons in the Inland Empire could qualify for the median priced home, the volume of sales is impacted.
Numbers do impact, but each successful sale of a single family residential real estate property
is an individual event. Someone has to desire the property and someone has to realistically want to sell the property. Numbers are the starting point at arriving at the buyers and sellers common goal for that piece of real estate and they can only point to value, not fix the final selling price.
I post numbers such as yesterday's median prices or the past month's transactions in the local real estate market. I share the data with my readers in the belief that the numbers can indicate how the real estate market is trending. These numbers do impact buyers and sellers, but they are always about the past, not the future. Unfortunately, because they can influence the decisions that buyers and sellers make, they they do impact the future.
A buyer, watching the value of homes decline, very likely will make a low offer for a property.
A seller, since the numbers show a slight uptick in median prices, may reject a low offer and lose a sale.
Both parties to a real estate sale need to adjust their expectations to reflect the current home values in the local market. The sale of property has typically occurred after successful a negotiation that arrives at a price that each can accept.
This is a market that is influenced by the numbers. Buyers and sellers are at the mercy of lenders. An appraiser evaluates a property based on homes that have sold in the past three months (the past). What has helped future numbers (selling prices) has been the sale of properties that have attributes other than just a low price (location, condition, amenities) and for which a buyer is willing to pay more, if necessary, to be the successful purchaser.
Other numbers that are impacting sales are the $8,000 tax credit for first time home buyers and the lowest thirty year mortgage interest rates. When 62% of persons in the Inland Empire could qualify for the median priced home, the volume of sales is impacted.
Numbers do impact, but each successful sale of a single family residential real estate property
is an individual event. Someone has to desire the property and someone has to realistically want to sell the property. Numbers are the starting point at arriving at the buyers and sellers common goal for that piece of real estate and they can only point to value, not fix the final selling price.
posted by shirley harry at 8:03 AM
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