In Massachusetts, we are already seeing an upswing in showings compared to the last several months. By the details in your question I can tell that you are pretty well informed about how this stuff works, but I'm not sure you are including the rise in demand as buyers who have been sitting on the sidelines for months stop worrying about the bottom and decide now is the right time for them.
Will your low end offers insult a couple of sellers? Likely, but it is also possible that you will find that one gem who has the motivation to take the loss and accept your offer. There are some sellers out there who would be grateful to see anything on paper! How do the lower tax assessments affect the market? I am sure there is an affect of some kind as there will be folks on both sides who follow your logic - but putting any number to that idea would be purely speculation, in my opinion. Looking forward to seeing what other folks think about this, Stacey
For example, in Colorado, the valuation process is completed every 2 years during the "odd" numbered years...so, in May 2007 my home was given a new value.....the value was based upon market values from 2005 and the first 6 months of 2006....so my home's valuation was based upon data that was 1-2 years old - that valuation will remain in place until May of 2009.....so if you were looking to buy my home in early 2009, the county's value for my home would be based upon data that was 3-4 years old. I am sure you would agree, the county's valuation of my home is probably out of date and different than the actual market value at that point.
So, depending on how your county /state does the tax valuation process, the county assessed value could be significantly different than the actual "market value" when a home is on the market.
Homes are still bought and sold house by house, neighborhood by neighborhood - I am not downplaying the analyst's comments as there probably are neighborhoods in the country that may see a 20% decline but I feel certain the Denver metro are is not going to see anything close to a 20% decline - my assessment is that it will stay flat or perhaps see a slight increase during the course of 2008. Will there be individual homes in the Denver market that will decline 20%? Possibly - a foreclosure that has been stripped and trashed due to anger could easily see that sort of decline, but that could happen in any market. There are also Denver neighborhoods that have continued to appreciate during the past 12 months. And, during the past 6 months, I have seen several homes sell in less than 7 days...is that every home, or even most homes? No, but it is happening and our inventory of available home is slowly being reduced. I recently heard that the number of sales in the Denver metro area for December 2007 was almost the same as December 2006 - that tells me that there were still a lot of Buyers out in the market and as long as there are a lot of Buyers, the prices will not be tumbling. You may want to find out how many homes sold in your area for the 4th quarter 2007 versus the 4th quarter 2006.
I cannot speak about home prices in your neighborhood but I would not rely on the county assessed values for determining what I might offer for a particular home - good luck in your search and thanks for your question - I will look forward to seeing responses from other parts of the country.
Let me put it in terms you may understand...You deserve to get paid a fair salary for what you do don't you? You wouldn't want your boss to say that they read a survey from Kansas that pays their employees 20% less than he pays you so he's going to cut your pay...
You can't insult people and low-balling offers only keep our economy in the state it is in.
The sellers who are in trouble are those that purhcased at the top... like in 2005 -2006. Now those people are trying to sell for what they paid, or maybe even a little more. Buyers are saying no way am I paying those inflated prices. However, sellers are stuck. They want or have to get what they paid...because many, many of them financed 100% or more. So we are at a stand off. Until those that are upside down in the house (owe more than the house is worth) are gone... asking prices are going to be higher. And things are not going to sell until the prices come down.
So yes, I think home prices (selling price) will come down 20% from the high of 2008 next year.
I don't think we will see the bottom in 2009 on a national basis (some markets could be okay). There is still a good bit of correction to be made.
In only about a week, the first held foreclosures will be released. That number is currently estimated at 700,000. All news reports and estimates I have seen forecast 3,200,000 foreclosures in 2009.
It's going to be a very bad year for some people.
We just have too many things going our way here. . thanks to our Government's roots here.
Your home's value has declined, no doubt about that. We will see the bottom sometime this year. Any percentage guessed is just an opinion.. your local neighborhood will determine the final outcome.
Do not set your sales on buying or selling using this method. Assessments are for the County Man!
"The Real Estate Doctor"