If you are a home buyer or seller reluctant to drop your asking price, MarketPlace.org’s segment tonight on jumbo loans is required listening: "Jumbo loans feel subprime weight."
During the past several weeks, The Real Estate Cafe has helped buyer clients in Greater Boston prepare offers on luxury condos and a single family homes in the jumbo price range. Thus far, sellers with broker listed properties have been reluctant to drop their prices, while FSBOs are ready to deal. Maybe it’s too early for the trend documented below to show up in broker "comps" (ie. recent sales):
"…more than 10 percent of his deals have fallen through in
the last few weeks — up from less than 1 percent. He says many people
just can’t get the loans they need. The same thing is happening in New
York, Boston and San Jose."
Will the rising cost of jumbo loans drive housing prices down in Boston and beyond, or as one economist fears, have a broader "jumbo impact on the U.S. economy." What’s your prediction? You can follow what real estate agents and others are saying on HomeThinking, what the public is predicting on My-Currency, and what the pros are modeling on Wall Street. You can also leave a comment below, or add the location of homes selling below their assessed value value on our Boston Bubble map or RealEstateBubbleMap wiki.
Before you make your prediction, take The Real Estate Cafe’s analysis of seasonality in the past into consideration:
According to [our] analysis of listing data between 1996 and 2002, one
in five Massachusetts properties that went under agreement between
Thanksgiving and New Year’s Day sold for at least 10 percent below the
original asking price.
Cross-posted on The Real Estate Cafe’s new, experimental social networking site.