Home Buying in Saint Louis>Question Details

Nu2stl, Home Buyer in Saint Louis, MO

Home prices too high?!?!

Asked by Nu2stl, Saint Louis, MO Sat Feb 23, 2008

Will home prices drop because it does not seem like they are. All I am seeing is overpriced homes on the market when the market is suppose to be a buyers market. When will home prices drop and should I wait until this summer to buy?

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Shop now. When you see a home you like, make an offer that youthink is fair.

Seller's agents sometimes talk until we're blue in the back trying to get the sellers to see reason. I can't tell you how often i've heard "i'll price it high, and if someone makes a lower offer i'll accept it; but I won't price low."

The market it determined not by what people ask for their hoomes, but rather by what people are willing to pay for them.

Best of luck.
Web Reference: http://www.KAthy-Carter.com
0 votes Thank Flag Link Sat Feb 23, 2008
Wait until the rates increase, then prices for homes will begin to fall. Many are buying now because they believe that when rates increase home prices will still stay high, making it difficult for them to find a home to buy. These people don't know any better and end up buying over priced homes with fear of coming rising rates. Eventually, when the rates increase, home prices will drop as well. Many buyers who paid too much for their homes will find themselves with underwater equity. Some of these buyers will eventually choose foreclosure, to avoid throwing money away (as they see it). They will also blame someone, other then themselves for their poor choices.
0 votes Thank Flag Link Tue Jun 9, 2015
I am of the opinion that housing prices are way out of line.

I have not seen an increase in my salary for 15 years, but housing prices have increased at least 100% in the last 15 years.

In 15 years, what will our children have to pay for a gallon of gas, a big-mac, a bottle of mouth wash?
0 votes Thank Flag Link Sat Mar 1, 2008
The media has painted a picture of drastically reduced prices across the country. In the St. Louis area, as most of the midwest, we have had moderate growth over the past few years. We did not see the rapid boom markets that have been enjoyed on the east and west coasts, and now the market is slower here but definitely not a "bust". The market volume and pricing in our area is similar to the 2003 market. There are good buys out there. St. Louis remains one of the most affordable metropolitan areas in the country. Your real estate agent can help you to find homes that have been reduced in price, those that are subject to a short sale, and those that are priced to sell due to pending foreclosure.
0 votes Thank Flag Link Tue Feb 26, 2008
Nu2stl- I am not familiar with your area so I will respond in a very general way. Real Estate is to a large extent LOCAL, but CAN be effected by NATIONAL events. Your area may not have had the big upswings in price like say areas in CALIFORNIA, NEVADA, ARIZONA and FLORIDA, which then would probably mean you won't get the big downswing either. Now that's not to say that if the economy, and the general perception of what is, or will happen to the economy in the short term, your MARKET conditions won't change. You need to determine what's affordable to you. Look at RENT-TO-PRICE RATIOS and GROSS RENT MULTIPLIER'S for your area. Renting should not have the negative connotation that many attribute to it. Buy only when it is RIGHT for you and become an informed consumer. Good Luck.
0 votes Thank Flag Link Sun Feb 24, 2008
If I remember correctly, you were considering attached villas and homes earlier this month. Those are continuing to sell very well, as are the single family homes in the greater St Louis area. We will find some single family homes and some of the villas and attached homes that have sat on the market longer than they should have, and have decreased in price, not because there is anything wrong with the home, but because they were either priced too high when they were initially put on the market, or the homes that they were competing against, were better in terms of location, price, condition and amenities. Those homes will typically drop in price below where they should have sold because they sat too long. We will also find some homes where the seller has a greater motivation to sell - they've already purchased their new home, they are relocating out of the area, etc. Those homes exist in ALL markets, both a sellers market and a buyers market. When you watch a neighborhood, it's easy to see the homes that are below the price of the other homes because that has happened to them. In some cases, the home should be at a lower price, but in others the home is lovely, it just got beat out in the beauty pageant by a home that another buyer considered to be better. If you would like to watch a neighborhood, have a realtor put you in an autoprospect system where you can save homes you like on line and watch to see when the price changes. The better systems allow you to put notes with the homes as well, so you can keep the records on line to track why you like the house, look at maps and directions, compare them to other nearby homes for sale, etc. I have buyers who are 2 years out from buying who are using this as a tool to decide the neighborhoods that they like the best and then watch for that great buy. The big thing to remember is when that great buy shows up, it's NOT going to last because you aren't the only person watching for it. You will need to be prepared to move quickly to view the home and then write a contract on it if it's the "right one", so talk to a good lender NOW and get a preapproval letter in your files so you're ready. You might also want to sit down with a Realtor and discuss what the actual process is from writing a contract and getting it accepted to closing and getting the keys to the home, so you know what costs to expect, the timelines, who will be doing what when and why, and what protections are out there for you.

This is truly a great time to buy, interest rates are low, there's a lot of inventory and the prices haven't really started to climb yet as they do when the summer market hits
Dale

Dale
Web Reference: http://www.yourstlhome.com
0 votes Thank Flag Link Sun Feb 24, 2008
Dear Home Buyer in St. Louis -
I just want to agree with the folks who have already answered and say the same is happening in Columbia (middle of the state) as you're seeing in St. Louis. The market is moving, housing actually stayed pretty close to what they were or went up in some areas and the news that "the sky is falling...offer the seller nothing" really applies to other parts of the United States. True, it is a buyers market, but we didn't see the astronomical rises in pricing of the last few years, just a slow steady appreciation (about 3% in our area) so we're not having the astronomical falling that comes from a volatile market (think Florida). Some areas of the country were so hot for real estate investing that people bought before the first spade of dirt was turned and sold before the first tenant moved in making scads of money. This is the midwest and the "show me" state so it's a different story. You really need to align yourself with a knowledgeable REALTOR who can talk about the specific areas in which you are interested and run market analysis for your price range and type of housing required. The lower priced entry level homes are jumping off the shelf here with interest rates being so low that many buyers who have been waiting are now buying. If you're in that price range, now may be the time to move as things don't appear to be going any lower. Good luck.
Trisha Lee REMAX Boone Realty, Columbia, MO
Web Reference: http://www.TalkToTrisha.com
0 votes Thank Flag Link Sun Feb 24, 2008
St Louis is NOT the national norm. If you read the articles in the St Louis Post Dispatch, you will see that our pricing slowed down a year ago, but in some areas NEVER decreased and in some areas continued to increase because the homes were in sought after locations and were in excellent condition. Our pricing really didn't decrease as much as it stabilized a year ago and then sat for a bit. Homes that were overpriced to start with, sat longer and had price drops to below where the agents recommended that the seller list them, so some decreases came that way, but homes that were priced correctly for their condition, location and amenities continued to be sold right away - I had one sell in a week, and 2 in a month recently. I will agree that some homes are overpriced, where the sellers haven't listened to their realtors, but that's where your realtor is there to help you determine what the real value of the property is, by doing a CMA before you write a contract on a property. It's almost midnight and I'm still at my office because I just finished doing comps for a buyer and helping them to write a contract for their first home.

We've already entered the Spring market. The phones are ringing and my office is writing contracts right and left. From what I'm seeing, pricing is already moving up. If you wait to buy, you will lose out because the prices this summer will continue to increase.
Web Reference: http://www.YourSTLHome.com
0 votes Thank Flag Link Sat Feb 23, 2008
You have a lot more selection and power as a buyer now than you will have this summer when you will have more competition. The national media has given the buyers here in the midwest a false sense of doom and gloom. In fact prices in St. Louis City actually rose last year and lead our area in price increases - in fact it is the best place to buy right now in our surrounding area as it is projected to have the highest rise in the near future also. Prices in St. Charles county also increased last year. The St. Louis metro area is not having as big of increases as we are used to;. but since we didn't have gigantic increases in the first place we didn't have far to fall. Any fall justifies calling it a buyers market.

You need to align yourself with a Realtor you can trust to give you accurate comps of the particular area that you are interested in to determine what a fair price is for a home in that area - be sure they also include the percentage of sold price compared to asking price. Then find your dream home and let your Realtor submit your offer along with the comps to justify the price you submit, if it is a low offer. Last year in my area of St. Charles County homes sold for an average of 96.5% of the asking price, which leaves quite a bit of room to negotiate if you have the correct realtor representation! I'd be glad to assist you with any further questions you may have about St. Louis, you can email me through the web site listed below.
Web Reference: http://www.TerryWillis.net
0 votes Thank Flag Link Sat Feb 23, 2008
Some areas are experiencing a slow down, and it does impact pricing however there are areas that are doing ok. In my area pop. 100k home prices have droped only 0.99% while in some places in Califonia prices have droped over 10%. (this is using 1 year ago pricing) The only real thing that has been affecting the Real Estate market has been the negative media coverage concernig sub prime market.
Now in the case of overpricing homes, It's a mistake that alot of sellers want to do and it does nothing but slow the selling process, and may even prevent the sale from happening.
0 votes Thank Flag Link Sat Feb 23, 2008
Home prices are not necessarily dropping contrary to the media publicity. Yes, home sellers need to be realistic to sell their home but don't expect to see dramatic reductions. Rather than taking big reductions, home owners are simply taking taking their homes off the market or renting them. You need to look at neighborhoods as that is really key to the current selling prices.

Don't wait until summer. There are many buyers in the market today and homes that represent realistic pricing and have appeal are selling. Wait until summer, then your selection will probably be what the market has turned down. Plus, interest rates are very attractive.

Why wait..find that dream home and make an offer. You just might get that home.

If you need help, give me a call at 570-5125.

Ron Gorman
Coldwell Banker Gundaker
ronaldgorman@mac.com
Web Reference: http://www.stlcityhomes.com
0 votes Thank Flag Link Sat Feb 23, 2008
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