To my friend Tom Blumer at Bizzyblog: Tom, the numbers, they be a lyin' to ya.
Friends are trying to sell their house, two doors up, one street over. The house next to them, same style, size, one year newer, but without landscaping, sold for 315k last summer. Our friends had their home on the market for 3 months at 280k...no buyers, two lookers. They put it with a realtor, bumped the price up, had an open house, no one came. Two months with the broker, one showing. That house is only in the stats since going with the realtor, and the price they're asking represents a profit (not a big one) but it will not sell there, apparently.
A single example? Too close to the forest....maybe? But we do see people every week in trouble. Client bought house in 03. Lost job in late 06. Purchase: 157k On market for 165k, no buyers or lookers. Bankruptcy filing, trustee took house on condition (approved by court and mortgage lender that he would list it for NO MORE than 144k - he listed it for 147k). Owed 121k to lender. One offer, 120k, trustee countered at 135k, no deal. House is back in lenders hands.
Prices reported are for homes sold. The backlog represents a dangerous truth. Prices are going to continue down, alot, for a long time. And it is not because the market has been talked down, credit has dried up for the majority of people. Clients that recently lost their house had a $2500 a month mortgage payment, their GROSS income was 32k a year, and has been for at least 3 years? How did they get such a loan?
If your credit score is above 670, have a good payment history and at least 10, but preferrable 20% down, loans are available and rates are great. If your score is under 640, forget a loan unless you are putting down 30% or more. That is from a local broker. For the moment, subprime is dead, and that means a lot of people will not be able to buy, or refinance.
Something read: only a first time home buyer takes a home off the market. Otherwise, every buyer of a home, is selling a home.