The listing on Homes and Land still has this property at $979,000, but over at Full Spectrum Properties the price is $100,000 less at $879,000.
Quite a drop, and it still looks overpriced for a 2 bedroom place with an attached appartment.
According to Zillow this home was worth $236,000 in January 1999 as the economy was roaring in the dot-com boom. Currently they estimate the value at $643,500.
Ask yourself, how many people could come up with a down payment of $175,000 (20%) and still afford mortgage payment of $4700 a month for 30 years. Contrary to popular belief mortgage rates are GOING UP for homes this expensive.
The one bedroom rental would barely cover the $8700 in property taxes a year plus maintenance expenses.
Of course, all it takes is one buyer. But in this economy I don't see it happening at anywhere near this price.
This is what annoys me about the market in Healdsburg. If you see this listing on Redfin: http://www.redfin.com/CA/Healdsburg/229-East-St-95448/home/2136896 two things become apparent. The first is that this place has not been updated in quite a long time, and the second is that this house was last purchased for 90K in 1990.
ReplyDeleteI have no issue with the owner trying to maximize their profits, but for this kind of money, you would at least expect the place to be updated. I have been in a couple of places in Healdsburg listed for 800K+ that have not been updated since the 70s/80s. Although I am fortunate to have a well paying job, it would be financially irresponsible to buy a place at this price point, only to have to put another 100-200K into it. I simply refuse to fund a baby boomer's retirement and put my family into debt.
The upper end of the housing market in Healdsburg has just not realigned. With limited supply, and many current owners having their houses either paid off (or close to it), there just isn't the realization that the market has moved on. At least in the large percentage terms that we see in other areas. At the end of the day, this will only extend the downturn in Healdsburg. Buyers will have to decide either to wait a few years, or to buy sooner in an area which will realign quicker.
"At the end of the day, this will only extend the downturn in Healdsburg. Buyers will have to decide either to wait a few years, or to buy sooner in an area which will realign quicker."
ReplyDeleteExactly. The real estate market is not like stocks or oil that trade by the minute. People can hold out and this causes longer cycles.
The upshot is, when buying a home, there is no need to try to time the bottom. Once it hits it will be here for years... possibly up to a decade.
Yes...and no. I think both Tom and HHB are right about the top of the market everywhere and most of the market in Healdsburg. What I am seeing in Santa Rosa in the REO market is pretty fierce competition once prices reach what I assume is going to be close to the bottom. For older, modest single family homes, that appears to be around $150K. One of my clients is looking in that price range and a house that had lingered for months at $225K suddenly had half a dozen good offers when the price hit the range the public wanted.
ReplyDeleteThe same thing is going on in Windsor at higher prices for newer homes. It's harder to calibrate in Healdsburg because our housing stock is more diverse, but the Canyon Run home featured in another post will eventually be a useful yardstick...if it sells.