Bailout boondoggle?

September 25, 2008 at 7:01 pm 4 comments


So I’m reading a story on the Sun-Sentinel website this morning about how the multi-gozillion dollar bailout won’t do diddly squat for the flagging South Florida housing market because the real fix won’t happen until foreclosures begin to fade away and the inventory of unsold homes begins to shrink.
::: mmmkay – makes sense … :::

”The Bush administration wants to buy the bad debts of banks, restoring public confidence in the financial markets. More mortgages would mean more home sales, and more sales ultimately would stabilize falling prices nationwide,” Paul Owers wrote.
::: Umm hmm, ok – I get that… :::

“The housing meltdown began in 2006 in part because too many people stretched to buy homes they couldn’t afford during the preceding five-year boom. From now on, analysts say, lenders will be more careful and home buyers will have to save for down payments,” Owers wrote.
::: gotcha, uh huh, still with ya … :::

Meanwhile, the housing slump is testing sellers, Owers continued, naming one in particular who has a three-bedroom home west of Boca Raton that’s been on the market for about six months. After two price reductions, the seller is now asking $309,000 and “may go even lower,” he writes.
“I’m getting all emotional about it because it’s so frustrating,” the homeowner said.
::: I feel you! :::

The story names the seller’s Real Estate agent, who said the company’s clients ” … don’t want to give their homes away …”

And you know — I totally get ALL of that. A seller’s gotta make some bank, y’all!!

But $309,000 seems a bit high for the times, no? Ahh, well it is Boca … still, the agent’s comments piqued my curiosity, so I went to their website, looked for homes priced around 300k employing that particular agent and there it was.

really pretty 3-2-2 with a barrel-tile roof, some lush-looking landscaping and a nice-sized kitchen.
::: this is where the HGTV ‘Designed To Sell’ UP arrow would come in :::

But the house was built in 1987, is 1,700 square feet and doesn’t appear to have had any major upgrades (granite? pool? oak?? …) in the two decades since it was built.
::: cue the ‘Designed To Sell’ DOWN arrow :::

Whattup?

– $309,000 – twice reduced.
– Area comps are anywhere from the upper 200s to the mid 400s.
::: Welcome to Boca … :::
– Palm Beach County officials valued the property at a proposed $255, 208 for 2008.
– The Zillow ‘Zestimate’ was a slightly more generous $277, 500.

Nothing seems too out of line – it’s not exactly screaming Code Red.

My mind keeps going back to the picture that ran with the story … it was of the seller standing in a kitchen — a kitchen FILLED with laminate cabinets and countertops …
$309,000 …

 … a laminate-laden kitchen in a proposed $309,000 home — bought for $132,000 in 1997 — according to the Palm Beach County Property Appraiser website’s property records search and Zillow.com.

Wait — 1997?!?
What part of the housing crisis that began five to six years ago is this seller who bought 10 years ago supposed to represent again???

Oh well, whatever — $309,000. For Boca laminate.
I guess that IS the crisis …

I’ll be the absolute first to pump a profit, but come on!
Kitchens and bathrooms sell — but not with outdated appointments.

I’m not picking on this property – or this story. I’m just pointing out what every other potential buyer can easily find and will gladly tell you.

Make the upgrades or be realistic. Sellers don’t have fall in line with or help justify the overpriced comps around them.

Perhaps part of the bailout plan should be a mandate for buyers, sellers and bankers to all get real about the ACTUAL worth of their shit.

When sellers get a goddamned grip and price accordingly we all win.
Otherwise bailout is gonna be just another word for boondoggle.

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4 Comments

  • 1. Type Writer  |  September 25, 2008 at 9:15 pm

    Sellers still want to party like it’s 2006. The latest news in the PB Rag that the median price jumped $30K will only encourage them… We’re so far from the bottom of this thing, it’s not even funny, but people are still pricing their houses like we should be grateful to buy them (can you tell I’m a bitter potential buyer? :))

    TW

  • 2. lifeisacookie  |  September 25, 2008 at 11:46 pm

    and I may be a potential seller at some point. I know what I paid for my house 7 years ago — before the market went crazy. I got a GREAT deal — and if I need to sell it (that would be ‘need to’ — not ‘want to’) I would price it accordingly and hope the next owner loves it as much as I do.
    karma baby — it’s a powerful thing (but then, sadly, so is greed)

  • 3. John Palmisano  |  September 26, 2008 at 11:24 am

    After reading these comments, all I can say is that it is price, condition, and marketing then the property will sell. I do not know if this homeowner is with a real estate agent, but they need to understand their competition. This seller needs to look at the homes currently on the market, what homes sold in the last 90 days, and what homes are currenlty in pending sales status. Otherwise they are chasing the market downwards and they will eventually lose out. They need to get in front of the market, because homes priced well and in good condition will sell, and pretty quickly. Most sellers do not like the number they will hear, but think about the additional mortgage payments you will make by holding the property, and when you eventually come to terms with price. You price will be even lower than before. So bite the bullet up front and move on.
    John Palmisano-Realtor

  • 4. lifeisacookie  |  September 26, 2008 at 12:37 pm

    John — you are very smart and summed up very well what I think a LOT of people are thinking!


This is the shit you bitches are reading


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