If people would be realistic in setting their home prices, this figure would be a lot less. But people still want to test the market, even though the market is down the toilet. I saw a house in my neighborhood sell within a week because the price was correct from the start. Another house was on the market for months and eventually with many cuts sold for what that other house sold for in a week. It is worth it to sell quicker and not deal with the aggravation of people tromping through your home for months. Many, including myself, could not afford to sell right now and are stuck. But there are some who really cannot afford to sell, but for whatever reason do not want to be stuck and expect a miracle.

To some extent I blame people for agreeing to PAY that kind of money for a house. There are always options and cheaper places to live. Just because your bank SAYS you can get a loan for "x" amount of money doesn't mean you HAVE to. It's called being a grown up.

Do you think people should start with original asking prices even higher then? That would seem to make sense if you want to end up with an actual sale price higher. Everyone knows real estate "prices" are for the most part fake and that buyers really have no reliable information to go on. Why be realistic? Make buyers think something is worth more than it is.

Bryan-

A smart buyer and a reputable real estate agent will check comparable sales, not list prices. Often times, when a home is listed, the price is not updated when a contract has been accepted. Instead, the final price will show once the deal has settled. If you offer an even higher price initially, no one will even bother calling to set up an appointment to see the home. The market is ironic- people want to sell high and buy low. Sorry, but it doesn't work that way. If you sell high in a good market, then you will buy high too. Now, you will sell low, but also buy low so it more or less evens out. Those that are underwater can't afford to drop their price. I think these are the people who have their homes up for sale at unrealistic prices. They have no choice but to ask for at least what they paid during the peak. Unfortunately, those people will have to wait a LONG time before they ever see equity back in their home. This is why "strategic defaults" is a big problem, and will continue to plague an ailing housing market.

Baltimore city housing market = over priced

I'm not even putting mine on the market just for that reason. I bought a house for my parents to live in during the boom. I got a great price on the house then, but the market has dropped the value so much I can't even refinance the darn thing. Looks like I will have to just stick it out.

Not worth discussion. Everybody knows that asking prices (especially nowadays) are pure fiction.

I love how a house in Hampden can still go for $200k. What a joke. I paid $63k for my home in Hampden in 1996. I guess I could sell it for $200k, but it's not worth it. Better yet, I love how we have the honor of paying some of the highest property taxes in the country, and we have nothing but overpriced houses and high murder rates. Yeah, this all makes a ton of sense!

Thanks for your words of wisdom Steve, but there are a lot of people that were responsible and decided to purchase a home they could afford. Many responsible homeowners are getting killed right now for doing what "grown ups" do and buy homes for their families. Us responsible owners don't need a lecture from you.

I think most homeowners think their homes are worth more than they are and they waste valuable time/money with their homes just sitting there. I see what Bryan was talking about all the time. People just wish they could get a price and hope people will come with offers, but if you are so far out of touch nobody will even come see your house.

I agree with Frank Rizzo that many homes are overpriced simply because the owners "bought high". Just one of the recent examples I saw - a 10-year old 3BR house with no garage is listed for the same price as a brand new one with 4 BR, garage and a bigger lot literally a couple of blocks away. I honestly don't understand what the owners are hoping for. To save everyone time I wish such folks would either get off the market or face the reality and cut their losses.

In the boom years too many people thought that most houses appreciated at the same pace. Crap neighborhood, track homes, generic row houses, builder's grade townhouses, etc... no different.

Valuation methods became too correlated to crown molding and granite counter-tops. $5000 worth of cosmetic changes somehow affected the underlying asset dramatically that was still in the same crummy school district.

In the olden days a crap house was worth a crap price. A mediocre house was worth a mediocre price. And only houses in prestigious neighborhoods or some other compensating factor bucked that trend.

Baltimore doesn't have much impressive housing so it probably won't fall outside of normal long-term housing trends adjusted for raw purchasing power. My impression is that with current RM models for lending and median income of buyers that xyz houses in Baltimore is probably overall at about bottom and might hang there for a while as inflation/market forces that want to delimit further price drops hold the line and the median adjusts as different pools of buyers take advantage of market inefficiencies.

The Baltimore City housing market seems like more of a vacuum than most assets. There's nothing intrinsically good about Baltimore, and in fact, the administration continues to operate out of an "entitlement world view", which pads their own paychecks/pensions and gives out money to the unproductive increasing tax burdens and (in my opinion) doing too little too address systemic problems.

There are still ways to make money in real estate and there are still houses that appreciate. Finding them, however, is difficult work--like anytime you want to find ripples in the efficiency of the market.

Whether or not there are price drops is foolish. The only thing that's relevant is whether the value is there and what sort of ROI you seek. And if you're looking for 10% appreciation by buying a typical Federal Hill row house, your probably not going to see that. You'll have to work harder and be more intelligent about the purpose.

I beg to differ. I think a lot of the housing in better Baltimore neighborhoods is absolutely lovely. The prices even during the bubble as well as now are excellent compared to anything remotely comparable in Washington DC and its surrounding suburbs. I bought in Baltimore because I would have had to pay between $550-750k for a basic and bland 1960s era split level in the DC suburbs and the selling prices of these still aren't that much better now. Baltimoreans harking back to the $63k house are just dreaming.

A recent Fortune article listed Baltimore as "one of the biggest problem areas" with prices that generate after tax mortgage payments that are 24-32% above a 1999 bench mark of 87 cents on the dollar to rent a comparable house. Falling rents mean prices need to catch a moving target.

http://money.cnn.com/2010/02/12/real_estate/housing_prices_rents.fortune/index.htm