Tuesday, June 17, 2008

Buyer’s Market

I’ve heard of incentives but this is ridiculous :
To get prospective buyers through the door — you can’t appreciate the hardwood floors, or the two fireplaces, or the waterfall or the pool if you don’t at least get through the door — the Garcias are ready to sweeten the deal.

“We will give two round-trip tickets to anywhere Southwest flies and a box seat for 4 at the Hollywood Bowl in Hollywood, CA, to anyone whose recommendations lead to a direct sale of this house,” Priscilla Partridge, Garcia’s wife, wrote in an e-mail to friends and acquaintances on Monday. She did not respond to The Tennessean’s request for an interview.

Her Realtor, Mara Thompson of Zeitlin & Co., said more and more sellers are turning to incentives. She’s seen people offer cars, a year of free gasoline, cruise vacation package and even — in the case of one $2.2 million home currently for sale in Green Hills — college tuition for the buyer’s children.

“A lot of people are doing it,” Thompson said. “With the market as it is today, I think people are just trying to be a bit creative.”

I’ve said all along that the Nashville real estate market is imploding. There’s literally a forest of “for sale” signs sprouting in Green Hills--and no, it doesn’t replace the actual forest that developers destroyed to build these homes.

But what do I know? In Sunday’s Tennessean, we heard from Michael Arnold, president of the Home Builders Association of Middle Tennessee, who offered this “clap louder” perspective:

What we are seeing here is a strong and resilient local economy that is bucking the national trend in several key areas, the first being in job growth. Unlike a significant portion of the rest of the country, Middle Tennessee is showing great strength in its job market. In fact, Middle Tennessee has accounted for more than 40 percent of all new jobs across the state in the period between April of 2007 and April of this year.

Huzzah! All is well! But why, oh why, are there so many “for sale” signs everywhere?

Unfortunately, first-time buyers, move–ups and retirees alike are being deterred from taking this crucial step by the national headlines that run in our local media. This waiting-to-buy syndrome is what is affecting our local market, unlike the aforementioned markets that have significant economic problems to blame for their current situations.

Damn you, liberal media! It's always your fault!!!

Of course, I've written before about our local media's valiant efforts to paint a happy face on the local real estate market.

Look, the economy is sucking everywhere. Nashville doesn't have magic fairy dust sprinkled over it making it immune from the same forces that affect everyone else. Pretending otherwise just makes real estate folks look lame and frankly a little bit desperate.

Here's a hint: I don't think an "incentive" to pay for someone's college education is the sign of a strong real estate market. Good for people thinking creatively and all, but if you need help paying for your kid's college education, maybe you shouldn't be buying a $2.2 million home. Just a thought.