Thursday, August 26, 2010

Real Estate Market Keeps US All Dreaming

I've been watching the Real Estate market since the fall of 2008 when I first thought about purchasing a home as prices were coming down. There was one particular house that has just about everything I could want and thus I refer to it as my dream house.

It is only a few blocks from the Jefferson park Blue Line station and the Copernicus Center, so I'd have my transportation requirements taken care of and be near my Polish peeps. It has a big backyard with a great deck and a two car garage. A finished basement and a modern kitchen. New windows, roof and water heater means that all we'd have to do is move in and paint the place.

In March of 2009, I called a realtor from Zip Realty who made an appointment so I could see it even though we both knew their asking price of $539,000 was way out of my price range. It looked even better in person, especially after finding out it also has an attic that could be expanded into a kick-ass master suite later in life.  On the downside, the basement was a little limited, it would be more of a children's play area than a ManCave, but I'd have to take a longer look if I ever had a realistic chance of getting this place.  Which I didn't.  In fact, no one really did.

The owner, who was expecting another child in July, had told me that if she didn't get an offer in a month or so, she was going to take it off the market because she didn't want to deal with a closing and a birth around the same time. I asked my standard "why are you selling such a great house" question and they responded that the husband had just got a job out of state. She also added that he could do the traveling thing if they couldn't sell the home.

I thought, well when the second child arrives that's gonna get old real fast.

My dream house was quietly taken off the market in Sept 2009. Thanks to the Internet you can learn so much about a house. I learned that the owners had a mortgage and a HELOC which combined put them at about $475K owed on the house, so they didn't have a lot of wiggle room.

On a whim, I emailed the owner the other week. Feigning ignorance, I politely asked 'Just curious if this home was still for sale and what is your current asking price."

It was over a week when i got this response:

"Hi. Thanks for asking. Its not officially on the market, but we would still consider selling for the right price... Nothing below our original asking price.  [Emphasis mine.]


The problem with this house is it's asking price. Anyone who can afford the asking price doesn’t want to live there and anyone who wants to live there cannot afford the asking price. They wanted almost $540K for it. And while it might have been worth that price at the height of the market, those days are gone for good.

I looked online and it appears they only have one mortgage now for $375K. I guess they were able to quickly pay off the HELOC and refinance. So while they have more wiggle room, they apparently want to recover all their renovation expenses.

And I cannot blame them for wanting to come away with something for all their hard work.  But there was just something about the sentence Nothing below our original asking price that irked me.  As if anything less was a personal insult.  It is no doubt this inflexibility on their part that caused them to take their place off the market.  It makes me wonder what they would say if someone offered them, say $525K, would they counter offer or just say no thank you.

I think it's fair to say that they are dreaming if they think they can get their price in this market.

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