Another Perspective on the Market Turn-Around . . .

Dani Grigg with IBR wrote a blog which I wanted to pass along.  It discusses alternate perspectives which are interesting:

If you walk down any given street in the U.S., odds are that one in every four homes you pass is worth less than what the owner owes on his or her mortgage.

In Idaho it’s almost as bad, with one in five homes under water, according to data from First American Core Logic, a real estate information company based in California.

I don’t know the numbers for the whole state, but median home prices in Ada County have been falling pretty steadily since mid-2006. This autumn they were down 37 percent since the peak in July 2006.

It’s a dangerous situation for homeowners who have to sell.

And it’s a headache for real estate agents, who have to deal with the long process and scanty payback of getting a bank to accept an offer that is less than what the owner owes.

I talked to a real estate agent this week who thinks the market doesn’t have to be this way.

If the community’s homebuyers would agree to stop approaching home sales with an eye to hack the price down to a fraction of its original size (I know another agent who calls this “raping” the seller), values would stop falling. Nearby homes would be able to be listed at prices more in tune with what the owner owes and with what the house is worth, according to some.

And he said others have a role to play as well: sellers should try to keep homes off the market, appraisers should give a property credit for every dollar of its worth, banks should start prices higher, and brokers and agents should stop accepting low-ball offers.

He talked about a home in Meridian that was purchased for $300,000 a few years ago, but is now listed at $190,000. He said he knows the listing agent would accept an offer as low as $170,000.

If we want to see an end to the real estate carnage and short-sale fever, that’s got to stop, he said.

I can’t speak for sellers, appraisers, banks or agents, but I think I can speak for buyers. I’m one of them.

It’s short-sighted of me, but getting the market back on track is the least of my worries.

I am thinking about purchasing my first home in time to qualify for the $8,000 tax credit, but my price cap is low. If I can find a house in my price range that is in a safe neighborhood, I’m going to take it. If that house really shouldn’t be in my price range – I’m OK with that. I’m leaving it up to the banks and the sellers’ agents to look out for everyone else’s interests. That’s their job, not mine. My future children will grow up in a neighborhood where they are safe, and that’s my top priority.

I think most buyers have a similar perspective.

And I hope that doesn’t make us “rapists” – hopefully we can just be labeled as we see ourselves: Lucky.