Comments

The market is cooling in the Boston area - maybe just the top end? Hmm ... interesting. Here in Albuquerque the inventory is historically low so it is an EXTREME sellers' market.

However, the home with views, a STORY behind it, and class - always sells super fast - bidding over the asking at times.

Posted by Sean at March 30, 2005 2:00 PM

The Boston Globe, like any other 21st century media outlet, knows we like to hear about the "rich and famous" and their multi-million dollar homes. But the median price of a home in the USA according to the National Association of Realtors is $191,000. An agent selling this sort of property will have to move about seventeen of these houses to get close to the $100,000 fee used in the article.

In my experience in real estate over the last 20 years, any agent worth her/his salt will admit that open houses are for the following, in order of purpose and effect: 1) to grow her/his client pool; 2) to satisfy the home owner that the agent is "doing something;" and 3) to sell that particular house.

Posted by Norm M at March 30, 2005 2:24 PM

I think Norm M nailed it.

First homes are such an odd "market"...a market of one, really. Brokers can do all the research they want with comparable properties, but for middle-class housing anyway, shopping for a house is more like dating than buying an expensive piece of gear. It's very very personal.

You can ask whatever price you want relative to the market and if the house appeals to someone in a personal way, they'll find a way to come up with the $. If its clearly under market price but doesn't appeal to the preson, they'll have a hard time committing to an offer, market "value" aside.

I think very few things besides homes sell this way. Maybe sports cars to financially-gifted teenage boys.

Posted by jeff angus at March 30, 2005 4:19 PM

Looks like a great "sell" signal for housing after a classic Elliott Wave 5 wave advance from 1990. This is the classic desperation phase of trying to move property prior to a "bear market". So, housing looks like it is going to follow on the heels of the 2000 stock market boom and bust.We've had the boom...now for bust. Renting will be the best strategy for awhile.

Posted by Steve Gettler at March 30, 2005 4:44 PM

Other signs of desperation in the market include the new forty year mortgage (that's right--40) and the 0 down payment mortgages banks are offering. There's also the "interest only" mortgage that is kind of like renting and must be an effort to get people to buy houses they can't afford. All these point to banks becoming desperate to loan piles of money to people who ordinarily wouldn't be in the market for a house.

Posted by Mike at March 31, 2005 8:18 AM

Now, I agree that speculation pressures have added to the values of houses, and this is more extreme in the upper range. My brother is looking for a one bedroom 700 Sq foot place in DC. They want $410K for them. The problem will be the number of defaults on variable rate interest only loans when houses don't appreciate above the 6-7% a realtor is paid. Will the number of people who default on their loans cause a surplus of property on the market thereby reducing prices of houses because they won’t appreciate like they have been? The real question is how big will the government bailout have to be to the banks when this happens?

Posted by Steve Battista at March 31, 2005 3:34 PM