Friday, February 24, 2006

Price Reduced! 2/16 - 2/24

Welcome to another edition of Price Reduced!

For all the newcomers to this blog, Price Reduced! takes a look at a handful of significant price reductions across Northern NJ. The purpose of this exercise is to serve as proof that the Northern New Jersey real estate market has long since been overvalued and has started the long hard decline back to the mean. These listings are in no way an endorsement by myself, nor do I believe they are a bargain or a value. Even reduced, I still believe these homes are still grossly overpriced.

On to the list!

MLS# 2209268 - Newark, NJ
Previous Price $249,000
Current Price $200,000 (Price Reduced 19.7%)

MLS# 2111702 - Phillipsburg, NJ
Previous Price $159,900 (Reduced from $179,000)
Current Price $128,900 (Price Reduced 19.4%, 28% off OLP)

MLS# 22047298 - Glen Ridge, NJ
Previous Price $925,000
Current Price $749,000 (Price Reduced 19%)

MLS# 2246559 - Montville, NJ
Previous Price $569,500
Current Price $469,500 (Price Reduced 17.6%)

MLS# 2224896 - Montclair, NJ
Previous PRice $1,200,000 (Reduced from $1,700,000)
Current Price $1,000,000 (Price Reduced 16.7%, 41.2% off OLP)

MLS# 2216676 - Randolph, NJ
Previous Price $514,900 (Reduced from $529,000)
Current Price $449,900 (Price Reduced 12.6%, 15% off OLP)

MLS# 2232910 - Montclair, NJ
Previous Price $1,395,000
Current Price $1,219,000 (Price Reduced 12.6%)

MLS# 2246959 - Morristown, NJ
Previous Price $339,000
Current Price $300,000 (Price Reduced 11.5%)

MLS# 2241651 - Jefferson, NJ
Previous Price $425,000
Current Price $379,000 (Price Reduced 10.8%)

MLS# 2222831 - Harmony, NJ
Previous Price $279,9000
Current Price $249,900 (Price Reduced 10.7%)

MLS# 2233481 - Roselle, NJ
Previous Price $289,900 (Reduced from $299,000)
Current Price $259,900 (Price Reduced 10.4%, 13% off OLP)

MLS# 2241723 - Madison, NJ
Previous Price $1,549,900
Current PRice $1,395,000 (Price Reduced 10%)

Something new this week is the "Short List"

Town/From Price/To Price/Reduction
South Orange Village/$1,525,000/$1,375,0009.84%
Montville/$1,549,500/$1,399,000/9.71%
Bernardsville/$989,000/$899,0009.10%
Madison/$639,999$585,0008.59%
Essex Fells/$1,525,000/$1,399,900/8.20%
Kinnelon/$599,000$549,900/8.20%
Morristown/$325,000/$299,000/8.00%
Chatham/$975,000/$899,000/7.79%
Mendham/$1,395,000/$1,295,000/7.17%
Scotch Plains/$1,250,000/$1,165,000/6.80%
Berkeley Heights/$460,000/$429,000/6.74%
Rutherford/$900,000/$839,900/6.68%
Glen Ridge/$749,000/$699,000/6.68%
Upper Saddle River/$1,169,000/$1,095,000/6.33%

691 homes were Price Reduced! this week, the average reduction was 3.79%, and the total dollar amount of the reductions came in at a bit over $13,300,000.

Caveat Emptor!
Grim

33 Comments:

Anonymous Anonymous said...

Price reductions? Never happens.It always goes up. Take out those ARM option loans eventhough serfdom is your new life.

2/24/2006 02:41:00 PM  
Anonymous Anonymous said...

Here's one in Chatham:

6 KINGS ROAD
CHATHAM BOR., 07928
MLS ID#: 2209247

http://www.realtor.com/Prop/1053048144

List Date: Oct 27, 2005

Original Price: $765,000

Current Price: $684,000

Dropped $81,000 or 12%

2/24/2006 03:02:00 PM  
Anonymous Anonymous said...

I have been watching this site for a while and I find it has some wonderful information and I find
the comments very interesting. I am
confused though- it seems like
many people are looking forward with glee to a real estate market
that is slowing...isn't this dangerous for our economy? For all
the employers,employees,workmen, deli and support industries? Yet this site appears to be looking forward to this happening. If it does, what does a great house matter, if we have unemployment all around. Of is it just me?

2/24/2006 03:14:00 PM  
Anonymous Anonymous said...

anon 3:14

It is not that. It is that we are sick of being feed BS! We believe that some folks hyped up the market for their gain. We in turn are sharing information to stop their evil plans.

Things come down. But the real fault is on the lenders that put people in bad loans, the realtors that BS buyers, the flippers that are out for a quick buck.

This will fall and at first a little then it will fall hard. It is too bad all will hurt but sometimes you need to have it happen.

No one will share information unless you ask.

2/24/2006 03:22:00 PM  
Anonymous Anonymous said...

"it seems like many people are looking forward with glee to a real estate market that is slowing... isn't this dangerous for our economy?"

Conversely, I would suggest that hyping real estate to the point where median home prices are so far out of whack with median incomes, is dangerous for our economy.

What's the norm, home prices @ 2.2 times median income? Where are we now, home prices @ over 10 times median income?

People here want things back to normal.

2/24/2006 03:30:00 PM  
Anonymous Anonymous said...

Well said! I second that

2/24/2006 03:57:00 PM  
Anonymous Anonymous said...

List Date: Oct 27, 2005

Original Price: $765,000

Current Price: $684,000

Dropped $81,000 or 12%


SO!
This price is still probably at Bibble peak Spring-summer 2005 levels. Hit it up on zillow.com to check comparables. Then take off 35%. lol!

2/24/2006 05:18:00 PM  
Anonymous Anonymous said...

Look there are no free lunches. Irrational overindulgence (spending more than you make)has occurred the last several years (5 years)It's time for a correction. IT IS INEVITABLE.LETS GET IT OVER WITH SO THESE IMBALANCES CAN BE CORRECTED AND THE ECONOMY CAN GET BACK TO A MORE NORMALIZED FOOTING. LIKE GROWING WITH TRUE GROWTH NOT DEBT GROWTH AT RECORD PACE.
THIS ECONOMY IS NOT STRONG. IT IS BUILT ON LEVERAGE AND REAL ESTATE BORROWING. THIS NEEDS TO END NOW OR IT WILL BE WORSE. SO GET TO IT NOW OR REALLY FEEL THE WRATH.

2/24/2006 05:21:00 PM  
Anonymous Anonymous said...

Here's another lunatic listing on literally the worst street in Short Hills (it's an isolated dead end street that overlooks a Wendys and a Bally's gym):

http://www.realtor.com/Prop/1055026444

Listed: Jan 21, 2006
Original Price: $759K
Current price: $729K

This is on Mt Ararat Rd, where last month someone just sold a brand new (built 2005) 5 BR, 4 BA mega-house with an ultra-nice granite/maple kitchen, 9 feet basement ceiling, etc, for $680K.

This joker thinks his 40-year-old POS is worth $50K more than the gigantic, ultra-nice house three houses away?

Homes on this street sold in the $500s before the mega-house was built, and now these idiots think their POS is worth more than the megahouse?

CRAZINESS!

2/24/2006 05:47:00 PM  
Anonymous Anonymous said...

HAHAHHAHA!!!!

Baby boomers have little to NO savings need real estate desperately to stay up. Uuuhhh Oooohhh it's not.

2/24/2006 08:00:00 PM  
Anonymous Anonymous said...

It's always about the money. What entitles Buff and Biffie to live rent free in a house which required three years salary twenty years ago to have me purchase it and pay ten years salary. They did nothing smart to deserve walking away with a bag of free money so they can be ten cent millionaires. That's what is causing the disgust and resentment in the protential home buyer today.

2/24/2006 08:46:00 PM  
Anonymous Anonymous said...

Another on Mt Ararat Rd (house #16), this one priced only $20K more than the far-nicer brand new mega-house down the street:

http://www.realtor.com/Prop/1055161849

Are these realtors idiots? The Ararat property mentioned in the above posting (house #17, priced $50K more than the new house) is via Weichert, and this one (priced $20K above the new house) is via Burgdorff.

Via domania.com, check out some other comps for this street:

19 Mount Ararat Rd
Closed Aug 2004 @ $375,000

10 Mount Ararat Rd
Closed Aug 2004 $495,000

This street has only about 15 houses on it, and they're all pretty much tiny Cape Cod style homes, on tiny lots backing a Wendys and a strip mall.

2/24/2006 11:41:00 PM  
Anonymous Anonymous said...

why are you guys paying so much attention to particular listings if you're so convinced the market is crashing? Don't the trends give you the evidence you are looking for? Could it be you are interested in .... heaven for bid .... buying something if the price is right?

2/25/2006 12:55:00 AM  
Anonymous Anonymous said...

Anon 12:55

Uh DUH!!! OF COURSE we want to buy houses!

We are waitng for prices to come down to sane and sustainable levels!!

Geesh!

2/25/2006 02:32:00 AM  
Anonymous Anonymous said...

wow there is a f___* lode of reductions on CL

2/25/2006 08:19:00 AM  
Blogger grim said...

Why do we discuss them? Because they are are confirming indicators.

On another note, just to pick nits.

Many readers here are homeowners, don't make that mistake.

There are two groups on individuals that read this blog.

The first are those who are interested in the economics and politics behind the housing bubble and it's ramifications. Some of there people are homeowners and some are renters. It's not about buying or having a home to these people, it's about how the housing bubble is a net negative drain on our economy and resources.

The second group of are those interested in purchasing homes, but are disgusted at the current state of the market, and refuse to purchase into it. This is not to say these readers can not afford to purchase, they just choose not to.

I carry on personal communications with a large number of readers every day, on any given day I send out at least 20-30 emails. (If I ever miss an email and don't respond, this is probably why). I will personally attest to the fact that many of my readers are surprisingly wealthy. Just because they have it doesn't mean they are reckless enough to plunk it down on a bad deal.

People come on here calling others "Bitter renters" and other dumb names. They have no idea that the person they are insulting probably has a six or seven figure net worth (not including real estate holdings).

Caveat Emptor!
Grim

2/25/2006 08:31:00 AM  
Anonymous Anonymous said...

Is there a way to get all the price reduced properties for a particular town? Thanks, great blog

2/25/2006 09:44:00 AM  
Blogger grim said...

No, you'll need to find yourself an agent that will agree to give you that data.

I'm sure many of the geek-types here would be able to write a script to go out and gather the listings at gsmls or realtor.com and compare them. Certainly is doable.

grim

2/25/2006 09:49:00 AM  
Anonymous Anonymous said...

Craigslist is getting flooded with real estate ads b/c the big markets like NYC are shifting to a $10 listing fee on Mar 1st. I've been tracking the term "reduced" on CL Real Estate for Sale and NY just crossed the 300+ listings for the first time. It's just anectdotal, but it's an interesting to watch.

2/25/2006 12:04:00 PM  
Anonymous Anonymous said...

"It's always about the money. What entitles Buff and Biffie to live rent free in a house which required three years salary twenty years ago to have me purchase it and pay ten years salary. They did nothing smart to deserve walking away with a bag of free money so they can be ten cent millionaires. That's what is causing the disgust and resentment in the protential home buyer today"

If you put a bid in give them this reason. 3 times versus 7-10 times. Not going to do it.
And alot of these 3 baggers think they are geniuses now. it's funny listening to them. it's called fortunate and luck for most of us.

The buyers are locked in for a long time. better get used to living in that POS for years if you pay the stupid asking prices.
If it seems stupid foolish and crazy it is. It's that simple. It's not complicated. Do not over analyze the situation.

2/25/2006 12:22:00 PM  
Anonymous Anonymous said...

That Newark property is way over priced. Average prices for a 3 bedroom in that (bad) area goes for 125-175 the most. The seller listed his price way too high compared to other propeties in the area. That is the reason why he/she had to reduce. Im sure they were hoping to sucker someone into buying it. In the back of their minds they knew they were going to have to reduce the price eventually. That explains the price reduction on that property. Prices of homes are out of control because people aren't thinking straight. You have some fools who are asking for 10% more for a three bedroom house than the guy down the street. Why should I spend 10% more on the same size/condition property. Of course the price is going to be reduced. Okay I am rambling now =) On a side note my flip in Rahway is up for sale and i have received two offers already 300,000+ If I choose to accept one of the offers I will be making a $120,000 in profit. I will be blowing bubbles all the way to the bank =)

2/25/2006 01:27:00 PM  
Anonymous Anonymous said...

Once Bush is pushed out of office and we elect a democrat for president, maybe the economy will pick up. Bring back Clinton! At least people had money to buy homes instead of taking out eighty year mortgages.

2/25/2006 01:31:00 PM  
Blogger Rob Ryley said...

"Once Bush is pushed out of office and we elect a democrat for president, maybe the economy will pick up. Bring back Clinton! At least people had money to buy homes instead of taking out eighty year mortgages."

The president has minimal influence on economic policy. To credit Clinton for the '90's economy is naive, to say the least.

Easy money from the Fed, and the Greenspan put are responsible for the economy of the 1990's.

The reason home prices are so high is because of govt. supports for the bankers, aka. Fannie and Freddie in the secondary market.

Without Fannie and Freddie, bankers would have to be more careful with lending money.

Now, they can lend to whomever they want, and then sell the loan, so they bear none of the risk for being stupid or greedy.

What is called "mortgage availability" in public is nothing more than the govt. supporting the financial sector (aka. the "rich"), while also buying votes.

But there is only so long it can go on. And now it is starting to unravel.

2/25/2006 02:15:00 PM  
Anonymous Anonymous said...

The reason home prices are so high are because of flippers like anonymous at 1:27 pm.

2/25/2006 04:32:00 PM  
Blogger Rob Ryley said...

Don't blame the flippers. Their actions are no different from someone who goes into medicine, law, finance, or some other profession where they expect a high salary.

In each case, the borrower is speculating that the cost of borrowing to buy X (homes, stocks, training in a profession), will
more than cover the cost of the loan.

Thanks to these flippers, the builders have the incentive to continue building, guaranteeing cheap housing for years to come, once the cheap money comes to an end.

Why is flipping possible? Because banks are willing to lend to them.

Why are banks willing to lend? Because they have willing buyers of the junk loans they put together.

Why do buyers accept these loans? Because the govt. has lowered rates so much that ordinarily unprofitable activites become profitable. Yet, lending money to less risky businesses isn't as profitable. They have an incentive to reach for yield.

Should the system become unstable, they just think the govt. will bail them out, like it always does.

Who got helped in the LTCM fiasco? The rich hedge fund investors, and the banks who loaned money to them. Bailing them out only makes them more bold.

2/25/2006 06:06:00 PM  
Anonymous Anonymous said...

"Once Bush is pushed out of office and we elect a democrat for president, maybe the economy will pick up. Bring back Clinton!"

LOL, trade the real estate bubble for the dotcom bubble.

Get a grip on reality...

2/25/2006 09:44:00 PM  
Anonymous Anonymous said...

"Could it be you are interested in .... heaven for bid .... buying something if the price is right?"

Few here would disagree with that, it's just that we think "the right price" for a home isn't 10 times our annual salary...

2/25/2006 09:46:00 PM  
Anonymous Anonymous said...

"If it seems stupid foolish and crazy it is. It's that simple. It's not complicated. Do not over analyze the situation."


Well said. The fundamentals have simply been pushed too far out of whack.

2/25/2006 09:48:00 PM  
Anonymous Anonymous said...

Here's a good one:
House foreclosure for unknown reasons. POS house sat on market for about a year priced at 1MM+. House price dropped recently to 780'sK, offer came in for the high sixes, bank accepted. As result of inspection uncovering numerous problems, buyers asked for $125K off price, reduction accepted, price is now mid fives- buyers still walked since they figured it would cost even more than that. So, now price was about 50% off original list. True story.

2/26/2006 09:17:00 AM  
Anonymous Anonymous said...

Here's a good one:
House foreclosure for unknown reasons. POS house sat on market for about a year priced at 1MM+. House price dropped recently to 780'sK, offer came in for the high sixes, bank accepted. As result of inspection uncovering numerous problems, buyers asked for $125K off price, reduction accepted, price is now mid fives- buyers still walked since they figured it would cost even more than that. So, now price was about 50% off original list. True story.

2/26/2006 09:17:00 AM  
Anonymous Anonymous said...

"buyers still walked since they figured it would cost even more than that. So, now price was about 50% off original list. True story."

What town was that? I'm looking for a POS fixer upper in a good neighborhood.

2/26/2006 11:10:00 AM  
Anonymous Anonymous said...

Non-Buyers Remorse!!! I love the comments from the sad renters who wish they could afford to purchase a home. Just a tad upset that they did not purchase a home 5 years ago and wish they could afford an investment that has tripled! Real estate prices have not declined nationwide since the Great Depression - do some research! So sad!!

- Investment Advisor

3/09/2006 05:38:00 PM  
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5/18/2006 05:52:00 PM  

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