One of the underlying themes of this blog (and of my life in general these days) is annoyance at home sellers who remain stubbornly in denial about the state of the real estate market. Just about every house I look at, either online or in person, gets a mental tag from me as “overpriced”. I try not to even write those words anymore when I talk about a house, figuring the reader can simply take that as read.
Just last week I got bit of a pleasant surprise as a little reality seems to be creeping into the real estate market here in the village. I saw two houses on Totten Place with pircing more in line with my idea of reality.. James Bednar over at New Jersey Real Estate Report calls these “Comp Killers”. So here we are, HIB’s first comp killers.
The first house, 51 Totten, was the first ever open house that I went to and the first one that I ever wrote about here in this blog. 51 Totten was initially listed at $509K, although when we went to see it, in May of 2007, it was priced at $499K. The owners had bought the place back in February of 2005 for $425K and, while they had obviously done some work to the place, it wasn’t $75,000 worth. Throw in the cooling of the market from 2005 to 2007, not to mention that the owners had overpaid for the home in the first place, and that price was way out of whack.
Looking at MLSLI’s new sold home tool, I see that the house just went for $407K in June opf 2008. That’s almost twenty grand off the 2005 purchase price and, considering all the work done to the place and the Realtor’s comission, a $50K loss or better for the sellers. Ouch.
The other house is 39 Totten Pl, which is two doors down from 51. When we went to look at 51 last year, 39 was having an open house as well, but we didn’t peek inside because we were short on time. This house was also originally listed at $499K. Zillow says that the sellers bought the place for $455K in August of 2004. The house sat on the market for a good part of the year until it was withdrawn from MLS. Just last week, the house was back on the market for $429K. While it’s hard to know without going inside, if we consider the 2004 sale price and the comp down the street, they seem to have priced the place in the right ball park.
You can be sure that these two “comp killers” will be in my arsenal when I start negotiations.