Market Conditions
One thing I do to keep an eye on the market conditions which will show how many homes are under contract vs price changes. In the good old days, you only did a price change when there was a lack of activity but because homes were selling at near 100% of asking price that wasn't a necessary step sellers needed to consider. It seemed even the homes in the worst conditions were selling and getting top dollar. That is a sellers' market.
Today I went on the MLS and checked the 'hotsheet' (most recent activity) and it's showing we have 8 homes under contract in Naperville, two of those are short sales.
We also have 15 price changes. The most drastic being a $29,000 drop after only being on the market for twelve days. So, if you are wondering why would anyone drop their price so drastically? The phone isn't ringing... Everyone has their own circumstances and perhaps that owner is being transferred, one never knows what the situation may be or perhaps they already found a home they want to purchase so will be more aggressive with the sale of their home.
You simply do not have the buyer's needed for the great demand we have so now we are in a buyer's market. Also, the economy is in a terrible slump. There are MANY factors that contribute to the mess we see in the housing market.
Lawrence Yun is the chief economist for NAR, you can listen to his market forecast and hopefully have a better understanding of what we may hope to see this year.
Basic supply and demand.
