I don't know what it is with Yahoo Finance advice columnists but someone get the hook please. Here is the latest bunch of gibberish from today's so-called expert Steve McLinden.
Q: Dear Steve, In a down market, when do you know if you've gotten the best deal possible when buying a home? Shouldn't you be expecting 20 percent off of the
list price?-- T.W.
Reasonable question from T.W. Although T.W. has some learning to do. First of all where does he (and I'll assume it's a he, no need to call NOW and file a complaint people) get this 20% business. Homes went up 200% in the past decade is some areas. A 50% drop is more like it there, 30% everywhere else. See the post below this one as Exhibit A.
Second you will of course never know when you've gotten the best deal. It's impossible to know the bottom of the market at any give point in time. You know if you got the best deal 6 months later when prices are higher. Or if 6 months later prices are even lower you didn't get the best deal.
That's what a reasonable response would be. Let's see what the so-called expert says shall we?
Well, perhaps it's not quite that dramatic. First off, you technically can't "expect" anything to be taken off the price of a home because prices advertised
as "firm" may have already been adjusted for this depressed market.
Are you effing kidding me? Even at the height of the boom people took a little something off. Hell I bought my house in mid 2003 when houses were staying on the market for 48 hours. And I got about $5000 off the asking price as well as the patio furniture and a big screen TV as part of the deal. If anyone is paying anywhere near asking price these days they need to be bitch slapped right back to reality. The so-called expert continues...
But even in this largely abysmal sales climate, 20 percent may be pushing the envelope a wee bit. Notice the use of that ambiguous word "may."
Sir, please see the post below mine. 20 percent may actually be pushing the envelope in the the reduction. As in the seller is pushing the envelope if he thinks he will get anywhere near 20% off his asking price. The so called expert continues...
In truth, your percent-off question requires a regional answer. Many markets in Florida, Georgia, Nevada, Arizona and Southern California, as well as in some on the eastern seaboard, invite lowball offers because prices there have dipped a little more drastically from the hyper-inflated days of 2000 through 2005. In more stable markets such as Austin, Texas; San Antonio; Portland, Ore.; Seattle; Salt Lake City; North Carolina and parts of Northern California (and elsewhere), prices are holding or even rising.
Wow. Wow. Wow. I cannot believe this kind of denial is still out there. Salt Lake City is rising? Really? No it isn't. Portland is rising? No it isn't. N. California is rising? Are you kidding me? No really are you high? San Antonio rising? The hell it is. Inventory is skyrocketing everywhere. It is simple supply and demand theory that Steve seems to know nothing about.
Actually the best answer to TW would be this. Keep renting for another year. In a year the asking prices on homes will be 20% off today's price. Then you go in, offer 10% off the seller is happy, you're happy and everyone walks away thinking they made out OK on the deal.
I don't get why the NAR (National Association of (Lying) Realtors) doesn't just come clean. Just tell sellers to lower their prices already. Don't do the water torture like Exhibit A. below. Why lower by $5 every month for 10 months. Just lower the damn thing by $50 at the beginning and get it over with. Sales will come back. Realtors will make money again. The market will be brought back from the dead.
They can do that, or give advice like Steve gives and prolong this housing depression for another 2 years. Sadly I think I know which choice they will continue to make.