Fortunately, the MSM is beginning to report on the problem with pricing. Why? Because the supply of idiot buyers (IBs) has just about dried up, and without the IBs, very few overpriced homes are selling. Ergo, the realtors are not making any money and (voila - we come full circle!) they've come to the same conclusion that we have: prices have to come down if sales are going to go up.
From Dick Hogan at the News-Press, an article relating this issue with it's effect on the commercial real estate business.
'A massive inventory of unsold homes in Lee County could bring bad times to both the residential and commercial real estate markets.
But real estate agents could help soften the blow by telling sellers to ask more realistic prices for their houses.
That’s what two experts told a sold-out audience Tuesday night at The News-Press Market Watch at the Harborside Event Center in downtown Fort Myers.'
With 23,000 houses and condos on the market in the county and the number rising, he said, the residential construction market is likely to slow dramatically this year as builders work through a backlog of homes ordered in better times.'
So, what's the connection between the deteriorating residential market and the commercial version?
'With 65 percent of industrial space occupied by people such as developers, subcontractors and suppliers for the residential market, D’Alessandro said, the commercial market could be hurt.
“The bottom line is fewer tenants,” he said.'
And though we haven't really addressed it much, what is the current situation with "work force housing" in Lee County?
'Also making a presentation Wednesday was residential broker Denny Grimes of Denny Grimes & Co., who like D’Alessandro writes a column on real estate for The News-Press.
Talking about the results of falling land prices, Grimes noted dryly that “the work force housing crisis is over” with houses in Lehigh Acres selling for less than $200,000.'
Well, if you think $200K is tolerable for "Mr. & Mrs. Ham & Egg", well...I would have to disagree. But that's just another symptom of the entire pricing situation.
'But generally, he said, the near future isn’t going to bring boom times for real estate in the county.
“Don’t expect the tide to start rising this year,” he said.
He did hold out hope that if real estate agents muster the collective will to talk tough to their sellers about prices, the supply of existing homes could be reduced more rapidly.
Too often, he said, agents soothe sellers with optimistic talk about additional open houses or other tweaking of sales campaigns.
“We all know what the solution is, don’t we? It’s called a price reduction,” he said.
Meanwhile, he said, things are bad and getting worse.
“In spite of what you want to believe,” Grimes said, “we’ve not hit bottom yet” and won’t until the inventory of existing homes starts to shrink.'
Enough said - it's good to see that our gospel is finally being heard.