I believe you can narrow down your confusion on list prices down to the fact that you're just not seeing some of the components that go into pricing a house. The short sale/foreclosure band of sales that Don is referring to has never before been so prominently displayed as there are just so many of them on the market now. Every single one of those comes with a hidden price discount that ideally directly relates to the amount of attached deferred maintenance and/or repair issues. This is where most of your confusion comes in. What may look like a perfectly reasonable match between two similar style homes where one appears to be grossly overpriced really hides the fact that the less expensive home has deferred maintenance issues that the other more expensive home does not have. When the waters are this murky, the more factual information you can get about a home, the better a deal you can typically negotiate.
I can imagine that as a buyer you feel truly overwhelmed and that you would rather wait until the dust settles and the real estate market becomes more constant and predictable again. However, I would challenge you that it is in turbulent times that you can also find some of the most wonderful deals. Keep in mind that you are in control. If you do not feel comfortable with a deal or a house, simply walk away. If someone wants to pressure you to do something, push back and ask their reasons behind it. If they can't convince you based on common sense and logic choose not to do it. I wish you the best no matter what you choose to do.
Jacobus "Jack" Vollenberg
RE Appraiser - Vollenberg Appraisers
Realtor/REO Asset Manager - Bridgewater Realty
Office (908) 968-0336
Cell (973) 590-0142
However, recognize that right now there are really two markets: One for conventional sales and another for short sales and foreclosures. There's some overlap, to be sure, but they are different.
Example: Take a community where homes sold for $500,000 3 years ago. You might be able to find a foreclosure or short sale (in "as is condition") for $300,000. However, someone who bought 10 years ago might be trying to sell theirs for $400,000. So, is the $400,000 property overpriced? Well, it's priced more than the short sales and foreclosures. But that doesn't mean it's overpriced.
In the community next to the one I live in, there were two identical homes last month. One was a foreclosure at $475,000. The other was not a foreclosure; it was priced at $595,000. The foreclosure needed some work--maybe $10,000 or so. But otherwise they were pretty much identical. And the foreclosure was really on a much better lot. Today, they're both under contract. Was the one at $595,000 overpriced? Well, the prospective buyers didn't think so. And it'll probably appraise for at least that much. Was the one priced at $475,000 underpriced? Not really. It sat on the market for about 4 months. The other (the non-foreclosure) sold in under 2 months.
Different people want and expect different things. Despite what a lot of Realtors like to parrot, it's not all about the price.
As for your situation, if you see a home you're interested in, have a Realtor run a CMA on it. Then--if you wish--make an offer at or below the CMA. Pay no more than the CMA. In the example above, the CMA probably would have come back at about $600,000 on the non-foreclosure and probably (even adjusting for repairs) about $575,000. There had been other sales right around $600,000.
Now, if the CMA for the nicer house in the community had come back at $525,000, then I'd have advised someone buying it to offer $525,000 or less. Probably a bit less. It's your money and you have to watch out for it. So don't let list prices scare you away if they appear too high. But my point is: Sometimes they're not high.
Hope that helps.
There are a lot of houses that are priced right, especially in LEH, but they don't stay on the market long so you may be missing them. Keep looking at houses that are new on the market and don't procrastinate in checking them out.
To answer your question ,no most homes are not overpriced but there ares some that are & there always will be in any market. Why? Because some sellers insist on listing it at their "wishful thinking" price & the other reason is that there are still some agents out there that will take a listing at any price just to get a listing. There are plenty of great values out there especially in Ocean County. If you are diligently looking for a home of a certain size & price range in move in condition with certain features & you are not finding it more than likely you need to regroup with your agent & prioritize your " must have" list. If you can't find the right house you may have to consider other towns with a lower price range or pay a little more for the house you like. Broaden your search & you will find it.
Yes some sellers are over priced but BUYERS set the values - always have - always will. Don't let them get you down. Most of the buyers learn the market and know it better.
LEH is got some great deals -who are you working with?
http://www.RealEstateInOceanCounty.info will plug you into the properties that have sold in your area. Pick Ocean MLS not Monmouth.
If your serious and call me
Some people do not like to deal with overpriced homes because the seller may not be serious about selling if the house is overpriced.
From an appraisal perspective, The market price of a home is what a qualified buyer is willing to pay. So, if someone is willing to pay a higher price then the home is not overpriced.