WARNING Homebuyers: Will feeling blue morph into feeling misled?

 

Misled 2008 NYTimes

Rising prices and games real estate agents play have Home buyers feeling blue, according to recent national surveys. Thankfully, Boston.com’s blog post this morning provided stats from Zillow and Redfin, even if it’s a bit confusing to compare and make sense of them.  Regardless, the direction is obvious:

“Only 25 percent of house hunters across the country think it is a good time to buy now, compared to 40 percent last year, Redfin reports.”

Compare those numbers Trulia’s Real Estate Regrets Survey a year ago, Marcy 22-26, 2013:  Then 75% of Americans felt it was a better time to buy a home than it would be one year from now.  Does that make today’s potential homebuyer cringe with regret or congratulate themselves for timing the market?  Before you decide, read today’s stats in the context of Zillow’s forecast / commentary six weeks ago:

Housing Recovery Entering Middle Innings in 2014, as Local Market Performances Are Expected to Vary Widely

“The housing recovery is entering the middle innings after an incredible run in 2013. Below the surface of last year’s market, a number of unsettling trends started to emerge as a result of rapid and ultimately unsustainable appreciation, setting up a bit of a mixed bag for 2014,” said Zillow Chief Economist Dr. Stan Humphries. “Affordability issues will help put the brakes on many markets that saw huge appreciation rates, like California and the Southwest, creating volatility that could potentially cause WHIPLASH (emphasis added) for homebuyers and sellers. At the same time, we expect more homes to be available this year as more sellers enter the market and more homes get built, and a decline in investor competition should make for a more hospitable market for many buyers. While a truly ‘normal’ market remains a ways off, we expect to take more steps in that direction as appreciation moderates, negative equity recedes, federal stimulus is withdrawn and foreclosures wane.”

FULL TEXT:  http://bit.ly/MidREcovery

Whiplash for buyers and sellers?

If you won a bidding war last year, and justified overpaying because rising prices would compensate, does receding buyer confidence and the caution above cause “regret?”  Before answering, check out the excerpt below about February’s pending sales prices across Massachusetts, and let us know if it causes you to do a double take.  Sound like Zillow’s warning about “Whiplash for buyers and sellers?”

When the Massachusetts Association of Realtors released their Pending Sales Report earlier this week, NPR / WBUR said NOTHING about declining median pending sales prices between January and February 2014.  Curious omission but consistent with the seller bias in the industry and real estate media.  In contrast, here’s what Boston Business Journal reported:

The median sales price of single-family homes put under agreement in February was $295,600, up 7.5 percent from $275,000 in February2013. On a month-to-month basis, the median P&S price was down 7.7 percent from the $320,000 posted in January.

The median sale price of a condo put under agreement in Februarywas $282,500 which was up 8.9 percent from $259,450 in February2013. On a month-to-month basis, under agreement median prices were down 5.9 percent from $300,000 in January.

FULL TEXT:  http://bit.ly/PendingPriceSlump

Regardless of whether individual homebuyers experience buyer’s remorse, will we see a Bidding War Backlash in the next 18 months and a repeat of regrets like those in 2008?

http://bit.ly/Misled2008

We’ve been collecting some stats that underline the importance of that question.  Want to see what bidding wars looked like in Cambridge during 4Q2013 or any other real estate market? Schedule a FREE consultation to learn more about our Bidding War Scorecard.

Posted in Bidding wars, Bubble Hour, Buyer agent, Consumer protection, Defensive Homebuying, Dual Agency Detective, Housing forecasts, iCovery, Real Estate Bubble, RECALL: Real Estate Consumer Alliance

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