Looks like time for an update to our Nov. 2008 story, "Renting Could Cost You $300k
There we discussed the case of 2909 Elm
, a 5br/4ba, 3450 sq. ft. home, built in 1991, that was first marketed in Dec. 2006 and always seemed to be listed well above its market value.
The property rented out rather than selling in Summer 2007, last listed for a bit over $2m. It came back on the market almost 18 months later – and $300k lighter. Here's the full price progression, as provided in the previous installment:
Now, 2909 Elm is finally in escrow, and we're hearing the deal is closer to $1.5m
Technically, that's about $1.3m (-46%)
off the start price. But let's not call that a market indicator. The size of that chop only really tells you how sorely unrealistic the start price really was.
We concur with a commenter's guess that this home could have sold in the rush of Spring 2007 for something like $1.8m
. But it was priced then about $600k-$700k too high at the time, and the sellers were holding out.
Often when a property rents out instead of selling, it's a reflection of the seller's bet that dropping out for a while and coming back to sell later will mean re-entering a more stable, normal market where you can get your price.
That's not what happened between Summer 2007 and now. But they did find a buyer, and not everyone can say that these days.
UPDATE: As of Monday, March 2, the escrow on 2909 Elm appeared to have failed, and the property was re-posted as active.