Icebergs? You know what I mean—big lump of ice floating in the ocean. All you can see from the surface of the ocean is a small part of the lump, but there is much more ice hidden below the surface.
All homes have defects, whether the market is hot (sellers' market) or cold (buyers' market). But the buyer's reaction to the defects changes drastically as the market changes from hot to cold. That's where the iceberg comes in.
Think of the the whole conglomeration of defects for a particular house as an iceberg floating in the mind of the buyer who has a particular home under contract. In a normal market some of the defects seem very important. They are the the part of the iceberg that "sticks up above the water" in the buyer's consciousness. Other defects seem scarcely worth mentioning. They are the part of the iceberg that "floats below the water" in the buyer's consciousness.
In a slow real estate market like we have this summer, it is as though someone has emptied all the water out of the minds of the buyers. The iceberg of defects lies there dripping on the floor of the mind, all coated with mud and slime. And the buyer can't take his eyes off the iceberg. He can't climb over it. He can't find a path around it. He can't allow himself to complete the purchase of the home.
The buyer no longer cares that he is buying the house for a low bargain-basement price. He no longer cares that he is getting a mortgage loan with a low fixed interest rate. His attention is transfixed by that big iceberg of defects. And, too often, he refuses to complete the purchase of the home. He refuses even though it is actually in his best interest to complete the purchase.
That's what is happening in today's real estate market.
ZIP Codes: 75206, 75214, 75223, 75246 Approximate Location Boundaries: Approximate boundaries are Central Expressway, Northwest Highway, White Rock Lake, and Interstate 30.
Location Characteristics: The neighborhoods within zip codes 75206, 75214, 75223, and 75246 are northeast of the Dallas Central Business District. The center of these neighborhoods is about 3 miles from downtown.
Most homes in these neighborhoods were built between 1905 and 1960. The sought-after neighborhoods of Lakewood and the M-Streets, Swiss Avenue Historic District, Munger Place Historic District, and Hollywood/Santa Monica are all located within these boundaries.
In the most desirable neighborhoods some old homes are being torn down, one-by-one, and new "McMansions" are replacing them. There is also strong demand for vintage homes with extensive renovations and/or additions.
About Ken Lampton:
Ken Lampton is an award-winning Realtor® known for his diligence in looking out for the best interests of his buyer and seller clients. A Realtor® since 1985, Ken deals mostly in neighborhoods located between downtown Dallas and the "northern loop" of LBJ Freeway, with a particular emphasis on the M-Streets, Lakewood, and East Dallas. Ken was selected by D Magazine as one of the Best Residential Realtors® in Dallas for 2007 and 2008.
These reports reflect the views and opinions of their authors and are not necessarily the views and opinions of Realty Times.
