Market Conditions in Madera>Question Details

Stacia, Home Buyer in Madera, CA

Home list prices--how much can I REASONABLY expect them to come down during negotiations? Or do I wait?

Asked by Stacia, Madera, CA Tue Apr 15, 2008

Should I wait a year to buy because of market trends?Do I buy now with 5% down? My credit is not perfect (middle score 617). I can qualify for a FHA with special Financing for Teachers. What should I do? Schools are Very imporant 3 kids: ages 8 (special needs) 9 and 14 yrs.

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Try working on getting your credit score higher and keep saving your money. Check you credit after 6 months or so.
1 vote Thank Flag Link Fri Feb 6, 2009
I you should wait the real estate market is in free fall like never before and price declines are a given over the next 12-18 months as foreclosures skyrocket and lenders tighten there standards even more. Inventory continues to rise and the foreclosure backlog is huge in fact in Fresno County over 500 REO's every month having been occurring just in the last 3 months alone. Many realtor's and so called experts missed this real bubble when it peaked in August of 2005 and now we are going right off over the cliff. There are numerous individuals who purchased just one year ago who are walking away (check out the trustee sales published everyday in the Fresno Bee). Before long we will be back to 2002 price levels and this downturn is picking up steam now that gas prices are almost $4 a gallon. The inventory levels today in Fresno County alone are almost 18 months with the current sales pace. I would expect 15-20% price declines in just the next 12-24 months because the bottom of this market will not occur until 2010 or 2011. We are so over built it's not even funny just drive around on the weekends and look. In fact one of my good friends works for Granville Homes here in Fresno and she said just last week at lunch sales are slow and they are not expecting the market to rebound for at least 18 months or more. If you really need a house for you and your kids go for it, but there will be much better buys if you just have some patience.
1 vote Thank Flag Link Wed Apr 16, 2008
Liz is very optimistic. Unfortunately she will be wrong. Home prices will not go up from here for the forseable future, as most people's income cannot afford the avg home. Will see a 50% drop for most ares esp CA, etc.
1 vote Thank Flag Link Wed Apr 16, 2008
In this market, it all depends upon what price point your seller has priced their property at.

2005 and 2006 and 2007 price levels are almost certainly too high.

In my market - (NW Burbs of Chicago) homes are selling at less than their high 2005-2007 prices. Smart sellers price their property accordingly. The best priced home in good to excellent condition sells fastest.

Getting good information on past sales is key to proper negotiations.

Not all areas are alike and some areas hold value far beter than others.

Enlist the help of a qualified Realtor® who is well known in your area and you will do very well.

Chris Bowman
Remax Experts - Buffalo Grove Illinois
Broker, Realtor®
1 vote Thank Flag Link Tue Apr 15, 2008
It all depends. Your best bet is to get a professional Realtor on your side. Somebody who watches the market every single day and see's what things are listing and selling for will know when a great buy pops up. If an REO property is already listed at 25% below it's last sale price, it has been my experience that most banks will be firm on the price. You can always watch it closely and if it doesn't see, resubmit your offer after another month or so.

The market is picking up in Big Bear at the moment. Every single house that came on the market that I thought was a great deal has sold. Most with multiple offers. Of course, the ones that aren't priced to sell just sit there. Most times, the seller can't face reality and is content to sit until " The Right Buyer " comes along. Most times they don't, and the home has a good chance of becoming an REO.
0 votes Thank Flag Link Fri Feb 6, 2009

Your question is one of the most commonly asked questions posted on Trulia. Unfortunately, it is very difficult to place a percentage on this and be accurate. Each situation is unique unto itself and really should be treated in this manner.

To generalize would not serve you well and certainly may not place you in an adventagious position for negotiation purposes.

It is our belief that the best way to deal with this experience is to treat each sinerio as an individual one. Have your agent provide you with the comps for recently sold homes in the same general location. These numbers should provide you with the capacity to create a price range that covers a reasonable offer price as well as your top number.

We do not feel it would serve your best interests to would be best to not be impulsive but it is important to remain in the game by actively searching for the perfect opportunity. You'll know it when you see it. But if you're not in the game you stand no chance of scoring.

Good luck
The Eckler Team
0 votes Thank Flag Link Fri Feb 6, 2009
I think you need to have a Realtor on your side during negotiations, and you should expect that Realtor to provide information so that you can be aware of the average sales price vs. list price ratios. You need to know what comparable homes have sold for in that area over the last couple of months. Market trends in most areas indicate that NOW is the time to buy. "He who hesitates is lost" and "Buy low, sell high" are cliches, but they are often repeated because they are true. We are in a buyer's market for a variety of reasons: high inventory, historically low interest rates, and great prices. Sellers have become aware that they can't keep their prices up and expect to sell. Take advantage of this market now. This is the best market for buyers that we are likely to see over the next 20 years! I cannot stress this enough--Do NOt Hesitate. Work with a Realtor to make an informed decision, be bold and BUY NOW.
0 votes Thank Flag Link Wed Apr 16, 2008
Hi Stacia, there is no way of knowing unless we know what the house you want is producing in interest. I have seen (in the last week) a multiple offer (17) where we were 20k over asking and we lost out, and I have seen an offer 75k below asking and we got it! Waiting may not be your strategy either, I am looking for 2 investors right now for 10 homes each. typically when they come back like that, it's "Game ON" Get yourself a good Agent. I have 300 Agents working with me, I would love to recommend one to you. Just call. 209-758-3113 or email best of Luck "The Coach"
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0 votes Thank Flag Link Wed Apr 16, 2008
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