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Is buyer confidence, demand and traffic at record lows ?

Bob Toll of Toll Brothers was quoted last night that as part of their preliminary outlook that "Buyer confidence, demand and traffic are at record lows."

I have always respected Mr. Toll as he has been consistently upfront and direct in regards to the status of the housing market where other CEOs seemed to be in denial.  

However, this statement I am not too sure about.  I think Mr. Toll is posturing for additional stimulus from the Federal Government, not in terms of a bailout, but to provide stimuli such as a larger tax credit for home purchasors and pressure for mortgage rates to go down.   I would certainly support that.

Still, statements like that can create more fear. I think the one aspect he left out is Location, Location and Location.  In Philadelphia, yes confidence is low, demand and traffic are down but not at record lows !!!

We have over 60 listings and a great deal of them are getting showings and offers are coming in.  I would say we are on the front lines. 

What is the pulse on your local market ?

Does you market have record lows for buyer confidence, buyer demand and buyer traffic ?

Chris and Stephanie Somers - Philadelphia Real Estate

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Comment balloon 28 commentsThe Somers Team • November 11 2008 08:36AM

Comments

In the Waterbury, CT area I am seeing that seller confidence is at record lows.  Most offers that I have seen have been well below the listing price as many are seeking rock bottom prices.

I think if this continues, sellers will take their listings off the market instead of facing these low ball offers.

Kind Regards,

Manolis

Posted by Manolis "Manny" Sfinarolakis (Keller Williams Realty) over 10 years ago

Mr. Toll needs to look inward.  The psuedo-luxury home market that his firm and others have created catered to the want-to-bes and those "trying to keep up with the Joneses".  These homebuilders generally skipped on quality and beefed up on showiness.  Now that the housing bubble has burst, these homes have poor re-sale value and will probably all be torn down in 20-25 years because the quality isn't there.  As more and more of the homes in these "luxury home" developments trend towards short sales and foreclosures, the quality of the living experience is sure to deteriorate.

The best "affordable home" out there is not in new construction.  It is taking the 40 year old home being sold by an honest in the need homeseller who wants downsize and is looking for buyers to make the necessary renovations to a structurally sound home.

Posted by Martin Kalisker, Professional Standards & Legal Assistant (Greater Boston Association of REALTORS) over 10 years ago

Good point Christopher and Stephanie. I think it's a generalization to think things are at record lows all across this country. They are when speaking of the majority but certainly not everywhere. Some areas are just down a few percentage points but those levels don't necessarily equate to record lows.  We'll see what comes out of this next year when the spring chicken has sprung and when 1000's of homes have willing sellers again. Downsizing is definetely in big demand right now and people are opting for smaller homes to save money on utilities, mortage costs, etc. 

Posted by Everard Korthals, Mountain Realty (---Preferred Lifestyle Advisors---) over 10 years ago

In SW Washington / Vancouver, WA area buyers seem to be looking for a steal and are making low ball offers. Some of our buyers have stopped looking for now and are just waiting to see what the market does. 

Posted by Patty Carroll over 10 years ago

Thanks for the post! It's very interesting to see different view points on this issue. I do not agree with his statements completely, but people believe what is reported in the media.

Posted by Home Loan Search.Online (Home Loan Search Online) over 10 years ago

Manolis - If these sellers take the houses off the market that is great as the inventory would go down !  Unmotivated sellers should not have their houses on the market anyway since it is quite evident that "they will not get their asking price" .  However, if the comparable sales support it, than it is just a matter of patience that the right buyer will come along.  There are still motivated buyers out there too to find the houses that fit their goals.  Interesting point.

Weichert - Good point.  As the prices of the new construction come down they are competing with other established neighborhoods as well.  Other homebuilders reputations is not that great whereas Toll Brothers "the luxury homebuiler" reputation has held up well, in addition to their stock price - only down 6 percent this year (not bad in comparison).

 

Posted by The Somers Team, Real People. Real Dreams. Real Estate. (The Somers Team at RE/MAX Access) over 10 years ago

I just hope that what comes out of this all is that homes are priced more realistically so that more people can afford to buy in the future.  Here in Albuquerque we have not seen such a rollercoaster market as other states.  Certainally I am seeing less business coming in, but the market is not completely stagnant here. 

Posted by Paul Chavez, Albuquerque Realtor, NM EcoBroker, and General Contractor (Earth Origins Realty) over 10 years ago

Chrisopher and Stephanie, I am seeing here on Long Island so many homes on the market...although they ARE selling.  One that was an eyesore just sold after only two months--I would like to find out what they got for it.

Posted by Laura Cerrano, Certified Feng Shui Expert, Speaker & Researcher (Feng Shui Manhattan Long Island) over 10 years ago

Castellum - I like it !  Spring chicken right around the corner an yes, some areas are already in demand !

Patty - We have that here too - these buyers just do not have any motivation - they have one foot in and the other out.  Once confidence comes back in to the market, these buyers will move much quicker.

Integrity - It is interesting to hear the likes of Toll, Trump, analysts...etc.  We can take something from it and move on !  I know that Toll's comments was mostly trying to get some more government stimuli.

Posted by The Somers Team, Real People. Real Dreams. Real Estate. (The Somers Team at RE/MAX Access) over 10 years ago

Location is the key.  In central CT, I find my first time buyers harder to find but they are out there and are excited about being able to afford decent housing again.  In my area, affordability is a big issue so prices coming down isn't always a bad thing. Sellers are confused - some houses go quickly while others stagnate.  But with many sellers (especially the older folks which is a big market in my area) having equity, not everyone is willing to negotiate and I think that's making the market numbers appear worse.

This is a market for serious buyers and sellers - and agents. 

Posted by Jessica Beganski (William Raveis Real EState) over 10 years ago

Paul - Yes, the good news is that there is always an inherent demand... in Philly, we have a super strong first time home buyer market.  Of course, then there are always folks relocating in and out, people that need a smaller home, a larger home... etc !

Carole - Yes they are moving !  The eyesore one must have been attractively priced !  Should be good for the area that it was gobbled up.

Jessica - Very good point and quote - "market is for serous buyers and sellers - and agents" !  I like it.  So true - the overpriced listings wont sell.  The buyers that are throwing darts wont buy.  And inexperienced agents cannot make it in this market ! 

Posted by The Somers Team, Real People. Real Dreams. Real Estate. (The Somers Team at RE/MAX Access) over 10 years ago

Chris & Steph - The Frisco market numbers are not as great in 2008 than 2007. With the upcoming holidays, things will continue to slow down. However, I do feel that with the new mortgage qualifications, it will be good buyers all in all. Like Paul's, our less than $150K market is strong and less than $100K markets are having multiple offers. It truly depends on the right points also.

Posted by Loreena and Michael Yeo, Real Estate Agents (3:16 team REALTY ~ Locally-owned Prosper TX Real Estate Co.) over 10 years ago

Loreena - Same in our market as well.  We have a strong first time homebuyer market so the properties under $100K will move pretty fast, the properties up to 150K will move relatively fast and so forth.. the higher you go, the slower it is.

We are grateful that our business is diversified, doing a decent amount in that range and having a foot in our "higher end market" too.   I think the agent that are just in the "higher end market" are struggling much more as a result.

Still, things are not at "record lows" in Philly !  We are super busy !  I barely made it through the day today as it one appointment after another, one phone call after another... all day !  Who says the market is slow ?  LOL.    Great to see you here !  Thanks.  ~  Chris

Posted by The Somers Team, Real People. Real Dreams. Real Estate. (The Somers Team at RE/MAX Access) over 10 years ago

I think in the surveys everyone wants a personal bailout !  Will check out your links and so forth.  There are some great informal surveys being done here on AR as well.

Posted by The Somers Team, Real People. Real Dreams. Real Estate. (The Somers Team at RE/MAX Access) over 10 years ago

It's interesting.  We have a good amount of traffic - probably about the same as last year, but there seems to be a chasm between the looking part and the making a decision to buy part.  And I don't think that a couple of dollars from the federal government is going to help that.

Posted by Patricia Kennedy, Home in the Capital (RLAH Real Estate) over 10 years ago

If they keep saying it in the news---people we keep with the same attitudes.  I think they need to turn off the TV and look at how they personally are doing.  The news drags us down to much I think!

Posted by Tami Vroma, Realtor, Grand Rapids MI Real Estate (West Michigan Real Estate Specialist-Five Star Real Estate) over 10 years ago

I know it is cliche' to say , location, location, location, but in some areas Bob Toll is off base. Though, unfortunately, in most places , especially here in AZ, he is right on target

Posted by James Wexler (wexzilla.com) over 10 years ago

Our market is INSANE!  Multiple offers and all types of buyers from first time to all cash investors!

Posted by Renée Donohue~Home Photography, Western Michigan Real Estate Photographer (Savvy Home Pix) over 10 years ago

Patricia - Good point.  It is difficult to get these buyers off the fence to move foward as many of them are still stunned with fear and indecision.

Tami - Definitely !  The news focuses on negativity and fear.  When the consumer buys into that, it is not good.  What is horrible is that the other side is rarely mentioned.  Unfortunately, it is the negativity that sells ads and attracts viewers I guess.

 

Posted by The Somers Team, Real People. Real Dreams. Real Estate. (The Somers Team at RE/MAX Access) over 10 years ago

In NH and MA, it's all local.  But overall, consumer's are leaning towards the sidelines due to the economy and the press.   We focus on providing current, qualified information to "inspire the consumer. 

Posted by Fred Doleac, Real Estate in a Virtual World (Fred Doleac - Bean Group) over 10 years ago

Our market is so up and down. Our inventory is down (thankfully) but so are our buyers. BUT, we wrote a deal today soooo... We have been working with this buyer for awhile, and he finally pulled the trigger. We have a few others we've been working with that I hope follow suit!! ~A:)

Posted by Alisha Harrison, Allyn, Belfair and Hood Canal real estate expert! (John L. Scott, Belfair) over 10 years ago

You guys have 60 listings?  WOW!

As far as the Fullerton area market, it has been pretty strong in the fist time home buyer arena (for me anyway).  It took me eight months to get into escrow for one buyer (closing tomorrow) and a couple of months for another.  Both were constant multiple offer situations and we kept getting out bid! 

I have three escrows right now but have noticed things slowing down just a bit. I am seeing people being a bit more concerned about their jobs and economy but things are still moving pretty quickly around here....if priced to sell of course!

Posted by Cristal Drake, Realtor - Fullerton Real Estate (Prudential California Realty) over 10 years ago

Christopher and Stephanie:

I think that Toll is telling of a different market than yours. They are high end track house market, mostly in outer suburbs. Ira Hovnanian was also on today about a tax incentive for home buyers today. I have a partner doing a lot of inner city business, especially in Philadelphia with city grant low end entry housing. They are going gang busters.

A matter of fact I was going to talk to him about meeting you and Stephanie. They are also in Mississippi doing SIP Housing. They have a panel manufacturing plant there.

Richard

Posted by Richard Stabile, Bergen County New Homes Builder Realtor (Re/Max Real Estate Limited) over 10 years ago

James - I hear you, it is those blanket statements that resonate in a consumer's mind that fuels the fear.  Statements should be qualified to a certain extent and also to address the market as well - obviously Mr Toll's market is the luxury new home market and those conditions will differ versus lower priced properties.

Renee - that is a great sign !  Maybe we will take a trip out and pick up a little investment property out there (Las Vegas) !  It certainly seem to make a lot of investment sense.

Fred - Yes, since we are on the front lines, it is important for us to communicate the truth and the facts about our local markets - also both the advantages and disadvantages - to the consumer.

Posted by The Somers Team, Real People. Real Dreams. Real Estate. (The Somers Team at RE/MAX Access) over 10 years ago

Chris & Stephanie

Thanks for the post. Far too many are peddling doom and gloom, yet there are sales taking place. Not all of my business is in foreclosures and short sales. Resales are taking place, not with as much profit to the seller, as was seen three years ago, but profits are there. The speculators and recent buyers who are trying to sell are experiencing difficulty, the quick profit schemes are dead. However, as you indicated location is important both in terms of the region of the country and the specific property. Likewise pricing has to be reasonable to attract a buyer and consummate a sale.

Posted by William Collins, Property and Asset Management (ERA Queen City Realty) over 10 years ago

Chris & Stephanie

Thanks for the post. Far too many are peddling doom and gloom, yet there are sales taking place. Not all of my business is in foreclosures and short sales. Resales are taking place, not with as much profit to the seller, as was seen three years ago, but profits are there. The speculators and recent buyers who are trying to sell are experiencing difficulty, the quick profit schemes are dead. However, as you indicated location is important both in terms of the region of the country and the specific property. Likewise pricing has to be reasonable to attract a buyer and consummate a sale.

Posted by William Collins, Property and Asset Management (ERA Queen City Realty) over 10 years ago

Chris & Stephanie- In Central Florida were are one of the Foreclosure battlegrounds, it's hard to see through the short sales and REOs... Sales are slower, but there are great opportunities for buyers right now... 

Posted by Debbie Summers (Charles Rutenberg Realty ) over 10 years ago

I listed one home a week ago and got it under contract in less than 4 days. Traffic for hte most part is dead, and buyer calls have evaporated.  I was waiting for a bounce form the election, it hasn't happened. 

Posted by Jim Crawford, Jim Crawford Atlanta Best Listing Agents & REALTOR (Crye-Leike REALTORS®) over 10 years ago

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