Prior to 2001 and for about 4 decades the average annual national home price appreciation rate was about 3% per year, but then we had the glorious housing bubble years from 2002 through 2006. During these years home prices doubled, you buy a home one day sell it the next and book a nice profit, and do it again and again. Then around 2006 something happened, there was a "POP" sound which quickly let all the air out of the housing bubble, causing homes prices to crash, giving back all the gains made since 2002 and then some. Who can ever forget that time, the pain, the stress, the financial losses. Yet it seems some have or at least do not believe it should affect them in todays housing market.
Believe it or not there are still some owners who are "Stuck in the bubble" years, owners who refuse to accept that there home isn't worth what it was back in 2006, they believe they can and should sell at higher prices then their neighbors because, well just because they should. Many of these owners have owned their properties for many years, because they didn't buy during the frenzy years they believe that some how the rules of supply and demand do not apply to them. They want what they want when they want it.
Granted its hard for any homeowner to accept that prices went down as much as they have but to believe you can get more for your home then its worth is counter productive, if you want and or need to sell your home in this market you have to accept todays market prices.
Now its not just a problem of sellers asking to high a price for their home, its normal and should be expected that sellers want to sell high. What compounds the problem, and exacerbates the further decline of home prices and delays the housing recovery is when real estate agents refuse to tell the sellers the reality of the matter. Yes its tough, but sellers need to know what current market value for their home is today. Thats not to say they will embrace the news, they normally do not but IMO they should know their homes true current market value.
To many agents want to get along, so they go along with the seller because they want to get the listing more then they want to sell the home. To what end, a home priced out of the market languishes, regular price reductions look bad because buyers can draw erroneous conclusions about the seller, like: they are unrealistic, difficult, and or the home has problems with it. So after a few months agents stop looking at the listing or stop recommending it to buyers and so that over priced listing sits for many many months without getting serious lookers.
For the housing market to get back on its feet, the inventory of resales has to be worked down, this will take longer if sellers aren't advised of what current market value for their home is. They do not have to like it they just should know it, who better to tell them then a professional real estate agent. Its bad enough with the amount of distress sales ( REO and short sales) flooding the market, we do not need to flood the market with over priced listing because in the end the seller is the one who loses.
Somebody has to burst the bubble of those sellers with unrealistic expectations, while nobody likes to get bad news and few people like to be the bearer of bad news, somebody has to, there is no better person to do this then their real estate agent, who should just remind them "not to shoot the messenger".
