December 31, 2006
Waiting game? Prices in 2007 vs 2010
The Boston Globe is asking readers whether prices will keep falling, remain steady, or begin to rise again in 2007. We asked our blog readers a similar question last year, but as the responses above show, wanted them to graph price changes through the end of the decade. We'd be glad to repeat that survey, but for now, just want to know whether you will make your own 2007 real estate resolutions based on where prices will be over the next 12 months or five years? Does it make a difference? Let us know what you think about what one industry spokesperson says about playing the "Waiting game."
September 06, 2006
Cape Cod Bubble Map documents sales below assessed value
Curious that yesterday's cover story in the Boston Globe, The Summer of their Discontent, did not include the word "housing" or "real estate" despite the reports by one blogger "that home sales on Cape Cod were off some 20.1% year to date and a whopping 30.7% in July as compared to July of 2005."
So to document what's happening there, the Real Estate Cafe created the Cape Cod Bubble map, using information supplied by RealtyInsite.com, to identify properties selling for below assessed value during one thirty day stretch near the end of the sales season (7/22-8/22/06). (It could take a few moments to download):
To scan the complete list of 140 plus properties by community, use the scroll bar on this larger screen format. We assume our readers know more than we do, so add comments, or post additional properties selling below assessed value, by logging onto this map for the Cape, this map for Boston, or this wiki which is waiting for user-generated bubble maps to be added in other overvalued housing markets across the country. It's also easy to start your own local bubble map or republish any of ours to your blog, or even select some of these bubble comps to submit with your offer. Contact The Real Estate Cafe for more information at RECafe@mac.com or 617-876-2117.
August 26, 2006
Are seller concessions masking deeper discounts on sales prices?
Side-by-side competition driven by the rising inventory of unsold homes across Massachusetts is creating a new kind of bidding war: escalating financial incentives to help sell homes as soon as possible.
Some time ago, the local MLS added a new field to document seller concessions at closing. However, entries are rare and as noted by one prominent critic, "current house price indices are failing to pick up the full decline in prices because they miss the various concessions (seller paid closing costs, buyer-side realtor bonuses, and seller subsidized mortgages) that sellers often use to move their houses."
August 23, 2006
Industry's seller bias understates risk to homebuyers
Kudos to the Boston Herald for asking "Has the Mass. housing bubble burst?" on their front page this morning.
If homebuyers focus on median sales prices, they might reach the same conclusion the Massachusetts Massachusetts Association of Realtors (MAR) did three months ago when they told the public that a "New study finds no evidence of a “housing bubble” in metro Boston."
Afterall, according to MAR's report on existing home sales during July 2006, median single-family home prices decreased just 3.5 percent from the previous year, despite declining sales during 17 of the past 18 months. To their credit, MAR also disclosed: (1) that is the largest annual price decline since March 1993; (2) median sales prices have declined for six consecutive months, and (3) that is the longest slump since housing prices fell 13 straight months from March 1992 to March 1993.
Bill Wendel | 09:18 PM in Bubble map, Falling prices, Housing forecasts, In the News, Market Trends, Predictions prices will fall, Protecting yourself, Sales falling | Permalink | Comments (0) | TrackBack (0)
August 19, 2006
CAUTION: You are entering "The Bubble Spin Zone"
"You're traveling to another dimension, a
dimension not only of sight and sound... but of mind. A journey into a
wondrous land, whose boundaries are only that of the imagination...
you're entering... the Bubble Spin Zone."
Reading some assessments of the current Massachusetts housing market, one wonders if industry spokespersons are taking their cues from Rod Serling classic, "The Twilight Zone." Arguing "that prices are not declining sharply in response to falling sales," one recently told the Boston Globe that "I'm seeing some concessions from sellers, but not a whole lot." Last August when the same spokesperson was asked by WBZ-AM radio talk show host Paul Sullivan if buyers were in danger of buying at the height of the market, he said no.
So, to help inform homebuyers and protect them from overpaying in overvalued housing markets, The Real Estate Cafe has developed an interactive map to involve homebuyers (and fellow buyer agents) in the process of documenting falling housing prices, in Massachusetts and beyond. Beyond price concessions, we are particularly interested in mapping sales below assessed value. Would you believe that some buyer agents first began chatting privately about homes selling below appraised value this time last year?
August 01, 2006
Add properties to bubble map before "Un-conference"
Exactly one year ago today, the Real Estate Cafe participated in a radio broadcast entitled, "The Beginning of the End of the Bubble" which featured some of our recorded interviews. Today, we celebrated that anniversary with more good news: the leading real estate technology news service featured our real estate bubble maps as an example of "Real Estate 2.0." Our interactive maps are getting attention because they allow users to post their own examples of a falling prices, particularly homes selling for below assessed value in Greater Boston. We created the bubble maps because news reports, including one this evening, continue to point to modest declines in median prices as evidence of a "soft landing for the housing market.
July 18, 2006
Bubble Map comments reveal surprising price corrections
If you visit their map and view the properties, you'll read some interesting comments including two favorites: (1) A stunning $530,000 gap between a 2005 assessment and 2006 sales price; and (2) a long post comparing the present market to pre-9/11 slump). After logging-in, you can write your own comments, add your own properties, or create your own map.
Thanks to WestSideBubble and another new user, SoldAtThePeak for their thoughtful contributions. We're open to your ideas about how to use this experimental map and wiki to protect homebuyers in overheated housing markets, in Boston and across the US. Over the next ten days, we'll add another 119 properties to the Boston bubble map showing locations of homes sold below their assessed value in Greater Boston during June 2006. Your contributions are welcome, too.)
July 15, 2006
1st user documents falling housing prices on Bubble Map
The first user has added two local properties to an experimental Real Estate Bubble Map created by The Real Estate Cafe to involve consumers in the process of tracking falling housing prices. Located at 21 and 30 Walker Street in Cambridge, Massachusetts, the contributions document an emerging trend: both sales prices and asking prices are falling below assessed values in once overheated housing markets in Greater Boston. Despite the prevailing myth is that housing prices never fall in Cambridge, the city is among 66 housing markets that have experienced significant price corrections over the past two decades. 21 Walker St. sold recently for approximately $150,000 below its assessed value; and the asking price at 30 Walker St. has fallen more than $110,000 below it's assessed value. That property went under agreement in 11 days in 2003 when it sold for $1,275,000. After six months on the market, the asking price is now $50,000 less than the sales price three years ago. (See comments on map for more detail on both properties and approximately 150 others in Greater Boston)
Both Walker Street properties are in walking distance to Harvard University, where an "Un-Conference" on Citizen Journalism will be held, Monday, August 7, 2006. It is hoped that other house hunters will create local bubble maps to protect fellow home buyers from overpaying in "extremely overvalued" housing markets nationwide.
June 14, 2006
Launching Real Estate Bubble Map
The map may take a couple seconds to load.
Following our earlier blog post about properties selling for below their assessed value, this map shows some of the largest recent savings. Interested in using Platial to create real estate bubble maps in local communities across the nation? Here are three options:
1. Register to use Platial to add your "Place" to THIS map. If you'd like to publish a copy of this map on your website, click here and simply cut and paste the html. The map can be resized to fit any page layout.
2. Send comments, corrections, or references to other properties asking or selling for (1) below their assessed value or (2) well below their original asking price to RECafe@mac.com.
3. Create your own map on Platial. For more information, read Wired's article, or listen to a story about the site from NPR's All Things Considered. Check out the repeated references to Platial on the Where 2.0 Conference News site, too.
June 08, 2006
Homes selling for below assessed value in Greater Boston
During the past three months, March through May 2006, another trend has emerged signaling the end of the housing boom in Greater Boston: nearly one in four single family homes is selling for below assessed value, according to an analysis of sales in 27 of the most expensive cities & towns in Greater Boston conducted by The Real Estate Cafe.
During the three month period, 921 single family homes sold across the 27 towns, including 216 sales below assessed value (see related map) identified in listing data from MLSPin.com. According to an interview conducted with Lawrence Yun, senior economist for the National Association of Realtors earlier this year, "There's no solid data, but it's pretty much well known that the government assessment is nearly always below the market value."
Preliminary data for May 2006, suggests that the number of homes selling below assessed value is rising, even though the percentage may be falling slightly. During March 2006, 71 of the 275 single family homes in the surveyed towns sold for below assessed value. That number fell to 61 in April when 257 homes sold across the 27 towns. However, preliminary sales information from May 2006, show that 84 of 389 homes sold for below assessed value -- an increase of 23 sales or 38% over the previous month.
More important, the year-over-year change raises concerns. During May 2005, only 23 of the 342 single family homes sales in the top 27 cities and towns surveyed sold for under their assessed value. A year later, that percent tripled, rising from 7% to 22%; and the number of homes selling below assessed value nearly quadrupled, rising from 23 to 84 sales.
Opinions vary about whether the rise in homes selling for below assessed value signal a loss in housing value, distressed sellers, or town assessments which have overshot a changing housing market. In coming days, weeks, and months, The Real Estate Cafe will take a closer look at those questions, and discuss which cities and towns are most impacted by this new trend, which towns are improving and which are getting worse. We invite readers elsewhere to let us know if homes are selling for below their tax assessment in your communities, too, in Massachusetts and beyond.