Monday, May 01, 2006

Lowball! 4/22 - 5/1

Lowball! takes a look at home sales over the past week from a very different perspective. For those new to Lowball!, a lowball offer is when a buyer offers a significantly lower bid than asking in hopes that the seller accepts the offer. We take a list of home sales over the past week and pick out the sales that have the highest percentage difference between asking price and selling price.

The purpose of Lowball! is to show buyers that the market has changed and buyers now have considerably more leverage than sellers. Just a short time ago, Lowball! offers would have been laughed at and discarded, however, not any more. The fact that so many under-asking offers are being accepted is clear proof that the market is changing.The list does not contain all sales, I hand-pick the most interesting sales from the list. These listings might be the highest dollar drops, biggest percentage reductions, or sales in towns that are thought to still be 'hot'. Please note, even with double digit percentage reductions, these homes are still incredibly overpriced.

On to the list!

MLS# 2218107 - Little Falls, NJ
List Price $396,900
Sales Price $310,000 (21.9% Lowball)

MLS# 2210393 - Andover, NJ
List Price $299,000
Sales Price $250,000 (16.4% Lowball)

MLS# 2109439 - Franklin, NJ
Original List Price $850,000
List Price $775,000
Sales Price $650,000 (16.1% Lowball, 23.5% off Original List)

MLS# 2228760 - Phillipsburg, NJ
Original List Price $150,000
List Price $125,000
Sales Price $105,000 (16% Lowball, 30% off Original List)

MLS# 2215218 - Verona, NJ
List Price $1,500,000
Sales Price $1,288,000 (14.1% Lowball)

MLS# 2099115 - Manville, NJ
List Price $335,000
Sales Price $290,00 (13.4% Lowball)

MLS# 2089382 - Livingston, NJ
Original List Price $479,000
List Price $459,000
Sales Price $400,000 (12.9% Lowball, 16.5% off Original List)

MLS# 2109910 - Montgomery, NJ
Original List Price $1,750,000
List Price $1,599,000
Sales Price $1,405,000 (12.1% Lowball, 19.7% off Original List)

MLS# 2103382 - Fredon, NJ
List Price $337,500
Sales Price $298,000 (11.7% Lowball)

MLS# 2236513 - Montclair, NJ
List Price $215,000
Sales Price $190,000 (11.6% Lowball)

MLS# 2240203 - Vernon, NJ
List Price $202,900
Sales Price $190,000 (11.3% Lowball)

MLS# 2063093 - Franklin Lakes, NJ
Original List Price $2,899,000
List Price $2,699,000
Sales Price $2,400,000 (11.1% Lowball, 17.2% off Original List)

MLS# 2113198 - Chatham, NJ
List Price $1,225,000
Sales Price $1,100,000 (10.2% Lowball!)

MLS# 2222387 - Bloomingdale, NJ
Original List Price $450,000
List Price $399,999
Sales Price $360,000 (10% Lowball, 20% off Original List)

MLS# 2101534 - Independence, NJ
Original List Price #359,900
List Price $349,900
Sales Price $315,000 (10% Lowball, 12.5% off Original List)

Caveat Emptor!
Grim

25 Comments:

Anonymous Anonymous said...

30% below OLP

HOUSING BUST!!

La la la la la la la LOWBALL!!!!!

BOOOOOOOOOYAAAAAAAAA!!!!!

Bob

5/01/2006 05:56:00 PM  
Anonymous Anonymous said...

Just say "NO" to Ripoff Prices.

Ba ba ba ba ba ba ba BOYCOTT HOUSES!


Boooooyaaaaaaaaaa

Bob

5/01/2006 06:03:00 PM  
Blogger Metroplexual said...

Thanks for the Warren & Sussex intensive lowball!

5/01/2006 06:12:00 PM  
Anonymous UnRealtor said...

Sellers slowly facing reality -- forced to re-list absurdly over-priced junker with a $100K price drop. (Still needs to drop another $300K before coming in line with today's insane bubble prices.)


First listing:

106 Short Hills Avenue
MLS 2245162
Asking: $1,279,000
List Date: Feb 10, 2006
Days on Market: 80



Second listing:

106 Short Hills Avenue
MLS 2272564
Asking: $1,179,000
List Date: May 1, 2006
Days on Market: 1


The house is so ugly (given the price, anyway) they have actually removed a picture of the exterior from the listing:

http://www.realtor.com/Prop/1059176548


This owner is clueless. There are a dozen far nicer homes for sale in this town, on quieter streets, etc., in the same price range.

And re-listing under a new MLS number is unethical.

5/01/2006 06:43:00 PM  
Anonymous UnRealtor said...

Regarding this lowball in Chatham (2113198), I still can't believe someone paid $1.1M for this junker:

http://gsmlspicturesweb6.gsmls.com/MediaDisplay/74/hr3218174-0.jpg
(triple-click long links to select)

I guess if there's a fire, at least a hydrant is nearby.

5/01/2006 07:31:00 PM  
Anonymous Anonymous said...

Could anybody help me to find out what
happens for a house in edison. The
ML# 605789.
Thanks!

5/01/2006 09:10:00 PM  
Blogger Shailesh Gala said...

Michelle in earlier posts you said: What a discgusting and horrible idea. You're so PRO-FAMILY and PRO-KIDS - but just think about the impact that has on a municipality, not just in terms of education but in terms of sewer, roads, rec programs, etc. Yet you think that VACANT land which has, as far as I can tell, NO negative externality to speak of, should be TAXED so that YOU can have YOUR perfect house at a perfect price?

I completely disagree with your argument, and I think I am entitled to opinion. Your attitude toward FAMILY & KIDS is appalling.

If you read my all posts, I am support smart growth initiatives, rather than hapazard development. At present in NJ, you don't see any good planning. I think there is need for all kind of housing, and not just condos & McMansions. When you talk about open spaces, is it better to have one McMansion built on 10 acre land ??? Isn't that wasting open space ??? In my opinion, it will be better if houses are built with 1/4 acre land and environmentally sensitive spaces are protected. You need to read up on how Smart Growth actually helps environment then hurts. My objection is to the fact that due to fiscal issues, towns are only allowing certain types of houses, and not looking into future. All the other services you mentioned, can be provided if towns & state spend money carefully and balance their budgets.

We are all waiting for bubble to bust, but think about it, if the bubble does not burst and prices stagnate with interest rates gradually increasing. Your affordability will go down further.

Ultimately, I think it will be decision of NJ citizens. If they continue with current restrictive policy, you will have larger migration out of NJ. Already you are seeing many business are moving south. I know many families who grew up in NJ, but their own kids can't afford to buy house in the state.

And I don't buy the argument that we have total FREE market. We have regulated market, and they are changed all the time. The trouble in our system is politicians don't react till situation goes from Bad to Worse.

And last note, if you could afford the dream house that you wanted to buy, I gurantee it that you would have already bought it, and would not be visiting this board.

5/01/2006 09:25:00 PM  
Anonymous Anonymous said...

Folks,

The bubble "burst" is over. Sure you'll see price reductions here and there and sellers just can't throw crap on the market anymore but do yourself a favor and read "Our Brave New World" by GaveKal Research. You'll see that the RE is just pausing and that intrest rates are going to remain low. What's that 30 yr right now? 6.5%? Sounds pretty low to me. Think Benny is gonna raise them more? How high ya think? Push that 30 yr to 7%? 7.5%? Maybe but unlikely.

As long as US companies continue to source production abroad, asset prices in the US will rise will consumer good prices will fall. Net effect, inflation remains tame and volatility low. Low volatility means stable job growth. Stable jobs mean a better ability to take on more debt and service it. We may not like the idea and the fact that we have a low to negative savings rate but look at the high savings rate that Japan has? Where has it gotten them for the last 20 years? A whole lot of deflation and nothing.

Sure oil house prices are higher but how high have prices spiked for clothes and everyday consumer goods? I seem to remember paying $300 for a CD player back in '98. Now I probably get that for $25.

Buy Real Estate now, while you can. The rich in other countries are buying 'em here. Why? Stable government. Plus NNJ is going to see a boom in population growth (+/- 1 Mil) over the next 20 years. Oh, worried about that outmigration? Why then is NJ Transit busying designing new train tunnels in NYC and why is NYC busy adding capacity to Penn Station and elsewhere?

Just look around this area and see all the new mass transit projects. 2nd Ave subway, Hudson Bergen Light Rail, Monihyan(sp) station, Seacacus Transfer, etc.

Its for commuters folks, not for tourists from North Carolina.

I can't wait to see the comments you have for this post. I wonder if Booya Bob will will say Lelelelelele Lemming! Or Dddddd Denial!

Fire away folks! Have a good night!

5/01/2006 09:51:00 PM  
Anonymous UnRealtor said...

It's nice to see flippers are starting to visit the blog.

How are those mortgage payments working out? And the property taxes, they have to be paid too. What are you at now, 100+ days on the market?

Hang onto that PriceLine stock!

http://finance.yahoo.com/q/bc?s=PCLN&t=my&l=on&z=m&q=l&c=
(triple-click to select long links)

5/01/2006 11:15:00 PM  
Blogger grim said...

Read just as many pieces at the height of the tech bubble that proclaimed the old rules didn't matter anymore. We're in a "new economy".

Turns out the old rules still mattered, who would have thought.

We're a few short months into a cycle that can take years to play out. Saying the "burst" is over already is just a tad premature.

You have a link to that piece or a PDF? I'm not about to pay GaveKal $20 to read it.

grim

5/02/2006 04:49:00 AM  
Blogger bairen said...

anonymous at 10:51

I remember my first beer.

Let's see. If you want to make bold bullish comments, please get a user name.

You wouldn't happen to be long a few NNJ investment properties would you?

5/02/2006 05:24:00 AM  
Blogger pesche22 said...

dont waste your 20k with gavekal
their are better newsletters around and most are free.

the guys in a dream world

5/02/2006 05:29:00 AM  
Blogger Metroplexual said...

Shailesh Gala raises some interesting points. He is right when it comes to real estate. The free market is not in play, at least in this region. The MLS is a cartel and RE agents as we know spout untruths, this does not allow for "perfect information". Also with municipalities fighting development and rezoning it creates artificial scarcity. Just look at the number of age restricted units built in the state last year. It made up around half of the total. That is a market distortion.

On a side note, NJ Transit is trying to get a new tunnel put in but it is coming at the expense of other projects in the state. One of particular interest to me is the Lackawanna Cutoff. If you sit in heavy traffic on I-80 in the morning , count the PA plates. Then imagine them taking a train to work. It would take thousands of PA drivers off of I-80 which cannot be widened.

BTW, I met Senator Arlen Spector up in Scranton yesterday at Steam Town NP he is a big advocate for the project. He is a good guy. If you are a train buff it is worth the trip to go to Steam Town.

5/02/2006 06:12:00 AM  
Anonymous Anonymous said...

I am 100% for any project that will take the PA drivers off of the road!

-Cultural Infidel

5/02/2006 06:40:00 AM  
Anonymous Bant said...

I don't understand the claims that house prices are justified due to real inflation. House prices are set by the market, and the market for houses is local. It doesn't matter what the global economy is doing. Local people are the ones who buy houses.

I know there are a few exceptions. Global cities do attract some global buyers, so a weak dollar will increase prices in Manhattan and Hawaii. Also, a weak dollar raises material costs, which could explain maybe a 10% increase in the list price of new construction.

But for the most part, it doesn't matter how rich the Chinese or the Europeans get compared to Americans - a 3 bedroom house in Piscataway is not bought by the Chinese or Europeans.

5/02/2006 07:05:00 AM  
Blogger Richie said...

The new NJ Transit projects are being made to deal with congestion problems in the current system. Did you ever take a train to Hoboken during rush hour?

Buses from most locations become standing room only.

Even the light rail is overcrowded.

5/02/2006 07:53:00 AM  
Anonymous Anonymous said...

I am out! My place went to closing today. Wanna know how I feel? Damn good that I made a great decision to sell and rent for a year or two.

I got walloped in the tech bubble. Not gonna let that happen again. I have gone to about 10-15 businesses and asked them how business is and ALL of them said they dont know what the government is talking about when it sees all this economic growth.

The home equity draw has run its course, all that money may show a few good quarters for non-d spending businesses but that lag will catch up within a year.

Aggressive lending? Thats over too. I wonder if Bush cut a deal with the bankers to spur all this bogus growth through winks and nods to stimulate the economy.

There is no way in hell ANY data can support these housing prices. The wages arent there to keep up with the prices. I have to admit that I felt a little ridiculous asking for the price I did but it attracted 3 buyers a few months ago.

Gas prices are gonna damage the economy further. There may be some good news for japanese makers because this year people are going to consider swapping out that SUV for an eco car. Why? Becuase that is what I am going to do.

I have an 80% return on my property for a handful of years of ownership. No debt and I own everything I have outright including my car. I also have enough to buy a few properties from people who will soon find out that they shouldnt have bought a house in the first place.

Grim keep up the good work, I've been reading this blog for a few months when i considered selling.

5/02/2006 09:19:00 AM  
Anonymous Anonymous said...

Also, wanted to add in...

You should put up a "Donate" sign on this site, that way we can donate to you so that you can buy the software you need to perform your analytics.

5/02/2006 09:21:00 AM  
Anonymous Anonymous said...

I agree, I would donate too!

5/02/2006 09:31:00 AM  
Blogger chicagofinance said...

Anon 10:19AM:
"I am out!"

You sound like Kramer on Seinfeld.

5/02/2006 11:16:00 AM  
Blogger Metroplexual said...

"I am master of my domain"

5/02/2006 11:18:00 AM  
Anonymous Anonymous said...

Looks like the mentality still exists that people who commute to NYC from Jersey make about 5 billion a year

5/02/2006 11:27:00 AM  
Anonymous Sugee said...

Look at the following nearly identitical homes from Realtor.com.

All of them are on Tyler Avenue, Iselin, from the maps it looks like they are all maybe one or two houses apart from each other.

The second and third ads appeared AFTER the first one had reduced to 299K !!

MLS ID#: 612243 - $299,900 (reduced from $329,000) - 3 Bed, 1.5 Bath - Type: Split level - 1 car garage, Year Built: 1956 - 6 total rooms - Central air conditioning

MLS ID#: 614697 - $339,900 (reduced from 359,000 I think) - 3 Bed, 1.5 Bath - Year Built: 1955 - Type: Cape cod - 6 total rooms - 1 car garage - Central air conditioning - 6 total rooms

MLS ID#: 617562 - $379,900 - 4 Bed, 2 Bath - Year Built: 1965 - Type: Detached, Split level - Central air conditioning - No Garage - Spa/hot tub (perhaps garage converted into 4th bedroom, and half bath converted to full bath.)

5/02/2006 02:59:00 PM  
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