Tuesday, April 22, 2014

Here's Why There is a "Shortage of Inventory" Of Homes For Sale.....

The headline on a Chicago Tribune article (on 4/22/14) is "Chicago Area Home Sales Fall Again In March", while the article goes on to provide IL Association of Realtors statistics about it. But they still don't get it.

Now that thousands of local readers think "Houses still aren't selling", those that do read the article are provided with more comparative statistics and theories about the reported 11% drop.

While thousands of real estate professionals fail to FIX the problem. After all this time, we seem to disagree about what that "problem" really is.

This article, like so many others before it, goes on to attribute the drop to the decline in the number of short sale and foreclosure sales.

My issue with this is that these distress sales should not ever have been counted toward true home sale prices in the first place. It is not a fair comparison! But it is a potentially costly comparison for thousands and thousands of current home owners who are stuck and can't sell.

Short sales and foreclosure sales are to satisfy a loan and NOT the actual value of the home. Yet, these same realty agents who are blaming everyone else, continue to act as if these distress sales ARE a reflection of property values.

Articles and news stories such as this one also always seem to quote realty association officials and/or supposed leading local agents acting as if a "shortage" of inventory is to blame, and then give us the "Now is a good time to sell" crap.

My point is that this "shortage" of inventory exists as a direct result of the distressed property sales being lumped together with "real" property sales. Home owners wanting to sell can't even get what they paid for their home years ago, let alone make a profit that would lead them to sell and then buy elsewhere.

THAT is why there is a "shortage". Potential sellers have to fight the realty agents telling them "We'll never get this much for your home".

I know and have done marketing and advertising work for hundreds of realty agents from coast to coast over the years. I have recently written a 60 chapter book geared toward home owners focused on getting their home sold at a fair price. I have many friends in the real estate community who want to do a good job and the right thing. Yet, I'm not happy with where the industry is going.

Suppose you are a professional performer or writer, or an athlete. You seek an "agent" to get you work, and for the most money possible. If you hired an agent to represent you in a negotiation and he/she came back to you and said "I won't be able to get you anywhere near what you are asking!", how many seconds would elapse before you would send him/her packing?

Sorry, but shouldn't we think the same way about a real estate "agent"?

Let me explain. I'm a victim of this too. Because a couple of similar units in the development I live in were sold, as distress sales, for a 40% discount, realty agents and appraisers now act as if my home is also worth 40% less than what I paid for it.

These same agents make a big damn deal about local home prices going up 1% here and 2% there. As I pointed out last month, the MLS database contains WRONG information about my home. Some major realty firms have the nerve to publish "estimates" about my home's value which are still more than 33% BELOW its actual value.

And now, these realty agents have the nerve to tell me "Now is a good time to sell"? Not unless they are going to pay me the $100,000+ in value they have taken away by honoring the distress sales!

Instead, they are sitting around wondering why there is "so little inventory". Sheesh.


http://www.chicagotribune.com/classified/realestate/chi-chicago-home-sales-march-20140422,0,865739.story



NOTE: Kohl's book, "8 Hours To Sell Your Home" is available by download at www.8HoursToSell.com, or on CD at Amazon.com.











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