Windlooker
Well-Known Member
John. Not sure where you are the 3 properties near me sold in a week at asking. Nothing sitting. I did make a smart buy in a great neighborhood. Many make poor purchases, again, the ebbs and flows of investing.
Turning the corner in the real estate market?
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jflournoy
Active Member
What’s hard to argue is your property sitting and not selling. Like most farms are now. Not to mention all the price reduced properties and still not selling. Well they were priced double the market! Now they are proved 3/4 higher! Keep sharpening the pencil!!! What this last post said makes lots of sense and sounds like this realtor isn’t like most fishing for suckers. Too bad every realtor isn’t like him. All these landowners that think their sitting on gold would be for sale by owner and never sell!
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I always say that "time on the market unsold" is a great clarifier for landowners, and sometimes that is the only thing that will help some of them see the value of their land is not quite where they thought it was. I have only ever had 1 landowner tell me he thought I valued his land too highly. 1. I've had several who thought I was "about right" with my valuation. And a BUNCH who thought I was way low.
There are certainly a lot of "price reduced" properties now, way more than a year ago. And if you start out at a crazy asking price, reducing it to something "less" crazy still doesn't mean it's in the right range of market value.
I will just throw in 1 other thought here regarding listing way above the market....A good realtor knows that time is money and he values his time. Am I going to list a property and do showings on it for months and months at an asking price I know it is extremely unlikely it will sell anywhere close to? No, I personally am not. I have out of pocket expenses on every listing and I don't make 1 cent until it closes with a buyer. I have told more than a few landowners I wouldn't do it at their preferred price and they'd need to find someone else. I need sales in order to support my family. Landowners who insist on listing at way above market value may end up listing with a realtor who is not as competent, is willing to cut corners, or who just wants his name out there and doesn't actually plan to put a whole lot of effort into selling the property at that price. None of those things are good for the landowner in the long run.
Windlooker
Well-Known Member
John Young
Member
You can’t go by what happened 6 months ago. Things are deteriorating by the day the closer we get to mid ‘24. But I’m southeast Iowa. Most properties are being listed way high because these realtors have no integrity and just want the listings. But they are sitting and lots being reduced and still way too high. Just look at what’s on the market and all the reduced signs. Properties priced right are still selling. But the over paying has pretty much died unless it’s a special circumstance. Heck I know of two different 200 acre properties one in Davis and one in van buren that went for $3100 an acre last April and one under $3k. But they were special circumstances on the cheap side. But the realtors don’t want you to know about those. Even though it’s public record. Both in very good deer hunting areas.
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Windlooker
Well-Known Member
I agree with must you stated, however, the only properties going at 3k right now are probably wetlands in WRP. I havnt seen prime rec ground in SC Iowa at those numbers since 2015, 2016, 2018 or so.
John Young
Member
Nope the two properties I know of are prime ground. Like I said both went around $3k. But both were special circumstances. One of them any die.hard hunter would die for. You wouldn’t believe it if I told you. Next door to a big time celebrity hunter in a highly managed neighborhood. It has about 60 acres of the 200 good tillable. Another realtor just listed another ridiculously priced property in Lucas county that will be sitting unless the realtor and seller come to reality. 190 acres with a small house for $1,690,000. Fishing for suckers. Nobody in their right mind is paying that. If they find a buyer it’s a clueless sucker. Plenty of realtors right now refusing to accept that the market is turning and still got the bobbers out looking for suckers.
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Daver
PMA Member
FWIW, not all realtors are "fishing for suckers", although it certainly does seem as though some are.
The dynamic that I have heard of lately is that two or more realtors are invited to potentially list a given property by a given LO that definitely is aware of the real estate value run up over the past 3 to 4 years or so. The realtor selected to list it has a real good chance of being the one that communicates that they can get it sold at the higher price, etc, to the LO. Boom, a listing agreement is signed...and then the property sits...because it is listed too high.
Now then, that ^^ does not mean that ALL current listings are in that same category...but some are and the more realistic realtors are often getting the short straw then. I think we are definitely starting to see some price/value changes at this time...but many sellers have now heard from others that they got "XXXXXX", therefore the potential sellers want that, or more, without always realizing that things are softening and/or that their ground is not as valuable as they thought, etc.
It is a frustrating place for a "good" realtor...sometimes missing out on listings because someone else is making bigger promises, etc, and/or LO's holding out on otherwise reasonable offers ( albeit below asking ) because they think that will still sell high, etc. Turbulence is definitely developing now...we'll see where it goes. I have looked at a couple of properties recently myself, but they are just priced too high, for me, at this time. Time will tell, but not every property is selling instantly for a new local record price...thankfully in my mind. Yet, some are still definitely trading high relative to historical pricing.
The dynamic that I have heard of lately is that two or more realtors are invited to potentially list a given property by a given LO that definitely is aware of the real estate value run up over the past 3 to 4 years or so. The realtor selected to list it has a real good chance of being the one that communicates that they can get it sold at the higher price, etc, to the LO. Boom, a listing agreement is signed...and then the property sits...because it is listed too high.
Now then, that ^^ does not mean that ALL current listings are in that same category...but some are and the more realistic realtors are often getting the short straw then. I think we are definitely starting to see some price/value changes at this time...but many sellers have now heard from others that they got "XXXXXX", therefore the potential sellers want that, or more, without always realizing that things are softening and/or that their ground is not as valuable as they thought, etc.
It is a frustrating place for a "good" realtor...sometimes missing out on listings because someone else is making bigger promises, etc, and/or LO's holding out on otherwise reasonable offers ( albeit below asking ) because they think that will still sell high, etc. Turbulence is definitely developing now...we'll see where it goes. I have looked at a couple of properties recently myself, but they are just priced too high, for me, at this time. Time will tell, but not every property is selling instantly for a new local record price...thankfully in my mind. Yet, some are still definitely trading high relative to historical pricing.
John Young
Member
Nope you’re right. There are a few that still have some integrity and a conscience but lots don’t have it. I could name ten right now and two whole companies. But I’m not going too. They know who they are. I surely hope they have trouble sleeping at night and karma finds them.
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jflournoy
Active Member
Properties that sell for a lower price because of "special circumstances" are no more indicative of the market at large than properties that sell for a higher price because of special circumstances. You didn't mention what the special circumstances were, but I can think of a bunch of circumstances that would absolutely cause an otherwise good property to sell for lower than the market. Access easements. High capital investment to run water/electric. Not a buildable property. "B" level dirt road only access. WRP. Surrounded by Amish landowners. Flood plain. Borders public land. Any and every one of those circumstances (and some others) would be ones I would talk to the landowner/seller about ahead of time to help set expectations for them being a value drag on the sale price. Not trying to be negative, just being realistic.
jflournoy
Active Member
I would just point out again that in my experience as a realtor, it is the landowners who are the ones that more often have a difficult time with realistic expectations. Do some realtors go along with that in order to get the listing? You better believe it. Do all? Absolutely not.
When I do a property evaluation for a landowner, I don't ask him what *he* thinks the property value is. *I'm* the one doing the evaluation, and what good is my evaluation if I can't give a good idea of market value? I lead with what I think the market value of the property is, and sometimes that takes me out of the running immediately because it's less than what the landowner had in mind. Then again, some landowners appreciate that I'm forthright about my opinion without fishing for their opinion of value first, and that leads to a constructive conversation about the "why's" of my evaluation, and sometimes that leads to a listing. Other times not. Before I became a realtor, I sold a property and business in another state and got very, very tired of having realtors come look at the place and being super coy about what they thought the market value was. They were scared stiff they'd lose the potential listing if they came in below my expectations. The one I ended up going with was a little coy to begin with because she thought I was going to list the place for sale by owner. When I assured her I was not, she came in with her evaluation and it was very close to what I was thinking, and she got the listing.
jflournoy
Active Member
I strongly resemble these remarks. It is frustrating when others are making big, unrealistic promises to get listings, but the truth is that a lot of times landowners don't really want the truth, they want their realtor to confirm what the landowner already thinks the property is worth. I'm honest about the value regardless of whether it will get me the listing or lose me the listing. In the long run, I would much rather be known as a realtor who can be counted on to be honest and forthright than one who will take a listing at any price even if he has to fudge the truth.
deerhunter93
Well-Known Member
Sold in 2021 for $721k (without the cabin/shed I believe) then just sold for 1.1mil in August 2023. Now listed at 1.7mil. Absolutely bonkers. I wish I could go back 4 years...
John Young
Member
The 227 with the cabin and northwest access in Davis county sold for $580k in 2017 I believe and now the seller wants $1,350,000. These people are beyond reality. 100%+ profit in 5 years. Look at that realtors listings. He is certainly one with no integrity. Almost all of his listings have outrageous prices and his properties are just sitting. Look at the Farmington listing. How long has that one sat stagnant on the market. But his company as a whole has always been really high and above what ever the going market is.
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jflournoy
Active Member
The key isn't comparing today's prices against what they were in 2017 and how much of a percentage increase it is in order to determine whether a property is overpriced or not. The key is comparing it against comps in the current market. And when I say "comps", I'm not talking about a single sale sometime in the last year, I'm talking about multiple sales of truly similar properties. I'm not offering an opinion on whether that Davis County property is or isn't overpriced or by how much, as I would want to look at the cabin and property in person first before offering an informed opinion. But the market legitimately went up probably 35-45% just between early 2021 and early 2023. It hasn't doubled since 2017, but it's a lot closer to a double than a lot of people might think. Whether or not land *should* have increased in price that much is irrelevant. The broader market of buyers and sellers rarely consult what people (myself included) think the value *should* be, from a "fundamentals" standpoint. Are we in for a lot more "price reduced" listings in the next year or more? I think we are. Are quality southern Iowa land prices going to correct back to 2020 levels? If they do, I think it's an indicator that we're going to have massively more serious things to worry about with our economy than the price of hunting land in southern Iowa.
hillrunner
PMA Member
I was standing at an acreage auction last night and overheard a farmer talking. He was looking out at the timber in the distance saying he believes that type of ground will bring more than tillable someday. His claim was basically that just like how people are drawn to build homes by water, now people want to get out of cities and live around trees with pretty views.
I have no idea if he was right or not, but I do worry about the ultra-wealthy acquiring a taste for rough ground. Just look at what's going on out west in states like Montana. If big money decides it wants it, that'll be the end of the dream for the common man.
I have no idea if he was right or not, but I do worry about the ultra-wealthy acquiring a taste for rough ground. Just look at what's going on out west in states like Montana. If big money decides it wants it, that'll be the end of the dream for the common man.
This survey is one I’ve watched for close to 20 years now. It’s for sure a great data point or ballpark figure for your area. I’ll make a prediction for the report that comes out next MARCH…. If no “big event” - I bet we see a statewide decrease of about 2%. Is this a big deal? NO. If a big event comes or in about 12-18 months…say trump gets elected specifically…. IF he gets elected: 1) commodities will come down. AG will soften. Period, end of story. (Starts with fuel prices & runs through whole system). 2) interest rates will get pushed down. Rec ground will be helped by lower interest prices and a stronger economy. That’s ONE event or example I think a fairly predictable outcome can be foreseen. Beyond that- do we have a catastrophic event or not?? Maybe yes, maybe no. Considering we are lead by total incompetence & corruption - I sure wouldn’t rule it out!!!
letemgrow
PMA Member
That's the sign that this isn't sustainable. Some type of correction is due as it simply can't double every 5 years in perpetuity.
John Young
Member
I fully agree that a major correction is coming. I also agree what the other guy says about it taking a major event. There are a couple major events on our doorstep. Between a recession worse than 08/09 and the possibility of WW3 the possibility of going from recession to depression is a real possibility. I’m not saying that’s going to happen. But history tends to repeat itself and it’s definitely a real possibility. Just look at the fact that debt is at all time highs and defaulting has already started. Foreclosures are already starting. Lots of Americans across the country are probably going to be in very tough spots in the next year or so. Plenty are already in really tough spots from being irresponsible with money. Hell lots of people have been irresponsible about saving for a retirement and counting on social security to be their sole source of income in retirement. JMO but I foresee lots of fire sales and the market becoming flooded with people trying to get out from under debt across the country. I personally know several land owners that barely get by and certainly can’t afford to miss a paycheck and inflation has been tough on them. Tough times ahead and I firmly believe no way around it thanks to bidenomics and the democrats. Ask yourself why the democratic run states are the most expensive places to live. It’s a tough environment to survive when democrats are running the country.
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