Sunday, 26 June 2011
Rules don't apply
Nine months ago I was telling him housing was in a pickle - huh? Six months ago his ears prick up - oh yeah? Three months ago he acknowledged he'd noticed the same - the market is slow. Today he's telling me the market is falling - but then he tells me his big plans, apparently this falling market thing bears no relation to his own house.
When 'they' say real estate is local, they aren't kidding. It's not the region; the suburb; the street; or even the house - it's the mind. While not medically proven yet, there's a housing gland in everyone's head and some people are unlucky enough to have a tumour grow on that gland. That tumour puts pressure on the housing gland, which then secretes house hormones that endlessly inflate the value of your house - in your own mind.
I couldn't imagine how big his tumour was, but all logic flew out the window. Despite the signs of the housing apocalypse - an apocalypse he readily acknowledged - he intended to renovate a couple of rooms, get the friendly bank manager in to see the obvious value he'd created, then get a re-fi and suck all that money out - oh yeah people are still thinking like this. The wondrous party of wealth over the last decade ain't over, apparently.
He will stick his hand into the watery ice bath left in the esky, dig around and find there's not one bottle of Boags' Premium left to drink, but he'll have to find that one out himself. You can't tell these people, the knife that cuts that tumour out only comes after a healthy dose of radiation - that's time on the market plus discounts.
Then comes the realisation, it's only a house. No more special than the rest and it is indeed subject to gravity. Just like some fellow Tasmanians are finding out...
In Launceston, this 4x2 was snapped up in November 2008 for $378,000. How has it fared in the current market? No bites at $395,000. No bites at $385,000. It's now available at the owner comforting price of $379,000. $1000 above the 2008 sale says they can still cling to the belief they haven't been hosed.
Down Hobart way, this 3x1 sold for $296,000 in June last year. Eleven months later and it was back on the market with the bait asking, "offers in the low $300,000's". Again, no bites and if you're wet enough not to put the pressure on when negotiating, you can currently pay $295,000.
Up in Burnie, this 3x1 was available August last year for $369,000. Months went by and the house disappeared from the market, the owners hoping for the market to turn at a later date, yet it turned on them. Now listed at $320,000, with the desperate tag of "all reasonable offers considered". The benefit of waiting.
In an attempt to look a scholarly gent, I've looked up a few quotes on patience, I hope I've understood this one by a Russian bloke called Tolstoy - "The two most powerful warriors are patience and time." In a real estate market such as this one, you can do two things - take a leaf out of the book of the bogan and have that tattooed on your forearm in Chinese, forget the meaning tomorrow, then buy a house because the media people are telling you affordability is improving . Or print that quote out, sit it on your desk and watch the discounts continue.
I dunno about you, but I'm partial to 'Patience' on one forearm and 'Time' on the other.