What’s Happening in the Luxury Home Market?
I woke up this spring morning to find an incongruent sight outside my window: baby birds feeding at the bird feeder in the middle of a snow storm! That’s right; a surprise snow storm and the oblivious (or brave) birds eating their breakfast in the middle of the falling white snowflakes.
It reminds me of the current real estate market! One minute, signs of spring are apparent- more buyer activity, phone inquiry numbers are better, under-agreement contracts seem to be on the up-swing. When “Bam!” a quick little freeze comes in, and brings the unexpected storm.
In fact, a bit of news on the foreclosure storm: Properties receiving foreclosure filings jumped 16 percent in the first quarter compared to the same period last year, according to a quarterly report by foreclosure data site RealtyTrac.
Filings — default notices, scheduled auctions and bank repossessions — went to 932,234 properties, a 7% surge from the fourth quarter. That means 1 in every 138 housing units in the country received a foreclosure filing, the report said.
That is not good news. Sellers who have been waiting for the “right” time to put their properties on the market, will find that this latest tsunami of foreclosures (REO’s) will flatten them–they simply will not be able to compete with REO listings on a price point basis.
Luxury home sales are in the same quandary; price shopping is now the “thing-de-jour”. Everyone is looking for bargains! And luxury home listings are providing them. Where a $200,000 home seller may lower their price by 10% to $180,000, conversely a luxury listing of $1,000,000 will be dropping it’s price at least $100,000 for the same percentage drop, but more likely will have to drop the listing price even further in order to get buyer traffic.
What’s a seller to do? My advice is to: choose your team carefully!
More about that in the next blog entitled “How to create your sale team when selling a luxury home”.
This entry was posted on Friday, April 16th, 2010 at 4:19 pm and is filed under Uncategorized. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.
