I read an article about "Millionaire Homes May Lose Value Until 2012":
"Currently, we have national home prices bottoming in 2011," they said.
"However, prices for more expensive homes may not bottom out until
2012, and ultimately result in peak-to- trough declines in excess of 60
percent (compared to 40 percent nationally)."
"California is
probably worse than other states, but higher-priced homes in general
are going to be a problem," Sim said in a telephone interview today.
I have been excited with the high surge of demand for starter ($150,000 and below) homes but as some of you have noticed I've been quiet about the mid to high end market ($400,000 +). I haven't paid attention as much to it until I read the above article. "Price for more expensive homes may not bottom until 2012."
Until 2012? Ouch. And what their saying make sense . More than fifty percent of home sales in Reno are bank-owned ($250,000 and below)--one and done.
Meaning, they're not your average seller who will most likely buy a bigger home after selling their smaller one.
The move up buyers (from calculated risk blog):
Move up buyers played a big role when the market was going up until late 2005, so what happens when move up buyers are no longer moving up? There will be small demand for expensive homes, prices will still fall.
It's never easy to deliver bad news like this. But as I have said before, it's better to deal with the hard truth now than pretend that it doesn't exist.
Reno home sellers, start with the market--what is it telling you? Where will the market be two or three years from now? Can you hold out or do you cut your losses short?
These are hard decisions to make but it will help you greatly if you start with an honest look at the market. Send me an email if you have any questions.
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