RCA in the commercial property press:

Home Sellers, Please Relax

Forbes reports: Forbes recently gathered a panel of real estate experts to discuss whether the U.S. is truly experiencing a bottom in housing prices. Panelists include Pat Lashinsky, Michael Feder, Spencer Rascoff and Peter Slatin. Our panel believes that if you are a seller it might still be prudent to wait as the bottom is not yet here. The discussion follows.

Forbes: Gentlemen, welcome back to our lively discussion of the housing market and the economy. Michael Feder, Radar Logic has released data that supports the idea that the housing market crash is slowing. The number of housing transactions in January was down just 6% from January 2008. And in a few key markets, particularly California, the transaction counts are up hugely, by 11% to 33% in that state's big cities. Prices are way down, of course, but the plummet is slowing, with house values losing 0.3% per month on average nationwide in the first three months of this year vs. the whopping 2% a month we saw them sliding last year.

Spencer Rascoff, Zillow's recent survey of homeowners indicates that many of them expect we're near a bottom, too. We can talk a bit about that.

But is all this talk premature? What would each of you tell a wealthy, investment-minded homeowner who has decided he or she owns too much real estate? Do you say sell now? Do you tell them to wait and see? Do you tell them lease their homes out? What's the smart move and how do smart investors make sense of all this talk?

Pat Lashinsky, ZipRealty: If you are a seller, you wait. Our April reporting showed that the median price of homes for sale in the metro areas where we do business were up in every market in April, and inventory levels are down. So while stabilizing, if you are a seller, there are numerous figures to show that waiting could be beneficial right now.

Michael Feder, Radar Logic: Yeah, if you're a sophisticated investor and you think you have too much real estate, you've probably been trying to sell for a while. If you haven't already sold, and there are signs of stabilization (which we think there are), wouldn't you wait now and see?

Spencer Rascoff: Nationwide, we're not at the bottom yet. Nationwide home values will still decline into 2010, and then I expect a long slow recovery--an "L-shaped" recovery rather than a "V." So from a pure returns standpoint, your investment-minded homeowner should either sell now or wait a few years, but don't plan on selling six to 12 months from now. The problem with trying to sell now though--and I see this all over the place--is that homes get tainted if they come on the market priced too high and then sit. So if you're going to try to sell now, price the home to move. Don't plan on being able to slowly drop the price if it doesn't sell right out of the gate.

Forbes: Good practical advice. Perhaps we shouldn't think that putting a house on the market at an above-market price and waiting a year for a buyer works.

Don Trump Jr. isn't here today. But I'm not sure he'd agree with this. His dad is a master marketer, obviously, and I've seen him be very patient selling condos in New York, even during the boom. That's come back to bite him in Chicago, I think. Next time we'll ask Don to explain when it makes sense to let a property hang out there on the market.

Rascoff: It's almost impossible for a seller to resist the urge not to price too high and "see what happens." Sometimes listing agents exacerbate the problem by "buying the listing" by quoting the owner a higher initial listing price and then lowering it a few weeks after putting it on sale. The Internet has made this tactic much more dangerous because buyers can now easily see "days on market" and the price history.

Peter Slatin, Real Capital Analytics: I have to agree with Pat--if you can, wait to list the property to begin with. Remember the blockbuster foreclosure rate we just saw, meaning more low-priced inventory on the market. But again, as always, a lot depends on your submarket or even your block. Whatever you do, don't do it in a hurry.