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In late 2005, Richard and Mary Truax decided their four-bedroom Viera home was more house than they needed and put it on the market.
Five years later, they stopped trying to sell it.
They had two offers during that time.
“We took the first offer, only for them to back out,” Mary Truax said. “The second offer came in much too low.”
Across the country, thousands of homeowners are in similar situations.
They face competition from a glut of new homes built during the boom but that remain vacant, as well as from lenders selling foreclosed houses and short sales of homes from owners hoping to avoid foreclosure.
All of these things push prices down, fueling even more foreclosures and short sales.
Gene Collins of Collins Associates Real Estate in Palm Bay sells foreclosed homes for lenders. Those lenders want homes sold as quickly as possible and price them aggressively, he said.
“The banks will literally push us to do a price reduction every 30 days,” Collins said. When traditional sellers don’t keep pace with other prices in the neighborhood, they end up priced out of the market.
And owners who are seeking a short sale for their home have no incentive to keep up prices, since they won’t make money on the sale anyway. “I’ve heard a lot of agents say that their clients don’t care if they cut the price by $10,000,” Collins said.
Prices plummet
Keeping up — or down, as it were — with those falling prices is the biggest impediment to selling a home.
When the Truaxes listed their 2,200-square-foot home in November 2005, they had an initial asking price of $379,000. It seemed like a good price, given that a 1,700-square-foot house down the street had just sold for $358,000.
“We were right with everyone at the time,” Truax said of other homes listed in the neighborhood.
The Truaxes had the bad fortune of listing their home just as house prices were beginning their steepest dive since the Great Depression. In August 2005, the median sales price of an existing home in Brevard County peaked at $248,700. By November, it dropped to $231,400.