Even Palo Alto, famous for its multimillion-dollar teardowns, is seeing price reductions.
Re/Max Realtor Karen Fink said she listed a house near Stanford University on a 1½-acre lot with “a ton of deferred maintenance” for $4.1 million in mid-August.
Since then, the average rate on a 30-year fixed rate mortgage has risen from 3.5 percent to almost 4 percent. The cost of building materials, which the home would need, has also gone up.
After reducing the price to $3.5 million, the Palo Alto property closed Oct. 30 for $3.18 million, nearly a million less than the original price.
Until recently, “egregious underpricing was a very common strategy” in San Francisco and other parts of the Bay Area, he said. Agents “would price 10 to 20 percent below” what the seller would accept, hoping to get 5, 10 or 20 offers and drive the price way beyond reason.
Now, when a home doesn’t sell within a few weeks, the agent may increase the price so as not to put sellers in the uncomfortable (but not illegal) position of having to reject a full-price offer that was lower than what they would accept.
Well, just saw an example:
Already 7% decline? Didn’t everyone believe would be less than 10%? Let wait and see.
Keep 'em coming!
They should include total listings too.
Over supply of houses? Buyers market
Buy Austin… near The Domain. There is a big HomeAway buildings there.
Zillow forecasts 7.7% to 9.1% rise in prices.
Huge price cut in SF. 1.7M down to 1.4.