I was riding high in April, shot down in May. Watching that mighty river of real estate sentiment, Zillow.com, I found recently that my accidental-landlord house in Virginia had picked up a cool 15 percent in value since January.
Why? Sentiment, baby, sentiment. With no properties for sale in the immediate area, I was getting the benefit of the Beltway real estate recovery in all its theoretical glory. I could actually calculate that the place might get back up to my closing price sometime around the year 3000.
Then some dirty dog a few doors down put his place on the market, priced to sell, asking way below my current zestimate. Now the whole neighborhood average is screwed. Try telling Zillow how that other person’s asking price shouldn’t count: Does that schmuck have a fully wired detached shed with both storage space and an office? A backyard gazebo? A quarter-acre lot? A tastefully redone basement? No way! But do they listen? I’m 18 percent off my purchase price now, all because somebody is actually trying to sell a property rather than blowing gas about the recovery.
This is the kind of mischief that results when you put consumer sentiment to the iron test of the market. The National Association of Realtors® keeps claiming there’s never been a better time to buy, but nobody believes it anymore.