Pfizer is leaving Ann Arbor, we have known for that for months. Fine !
Now all the Pfizer homes are coming on the market. Pfizer employees were given a 100 loss on sale clause. So if they purchased their home in 2001-2007, they will NOT make money on their house. Pfizer is compensating them for their loss up to 100,000. Great.
Problem is who is helping out the other sellers, who have to compete with homes WAY under market value? I met and did a pre-list appointment with a Pfizer relocating employee who bought their home in 2006 for 439,900.
I told them, "you can only get 410-420 tops". I eventually turned down the listing because the relo company would only let me have it for 60 days. Once he takes his buy-out it goes to Prudential Relocation Company that is handling all the Pfizer relo's.
So they list with an agent and it comes on the market at 429,900. ONE WEEK later it is reduced to 355,000. Now how is any other sellers going to compete with that ? There are other examples, but you get the point with this one.
Of course, the Pfizer employee will not lose his money. But, it is killing our neighborhoods and hurting all the other sellers who don't have 100K loss on sale clauses.
I respect a companies right to move to minimize their losses. I don't blame the employees for moving on and taking the buy-out. But, they have left Ann Arbor in a terrible situation, with the 3 MIL S.F. building empty and all the homes for sale, and the other sellers with out a buy-out, loss on sale clause. Now with their package they are forcing down the homes all over town.
I don't want to whine, but...........this has been bugging me for weeks, time and again, I am seeing the effects on our market and the price of homes.
So I rant and rave.............and now that I've put it down in this post, I'm going to go have more fun.
Fortunatlely, I am listing a house tomorrow where I dont' have to send my clients are Dr. John letter.
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Very interesting indeed! I have heard of situations such as this where corporations subsidize the housing of their employees...but this scale sounds like it'll have a big impact!
Wow! I;m not sure how the Ann Arbor market is compared to Flint, but that's a blow.
So I wonder, if someone can purchase a $429,000 for $355,000 what happens to the taxes. Something is worth what one is willing to pay.
How does that effect the property taxes? I've been in the business for 12 years and haven't had anyone get that type of deal.
Kaushik, it is having a tremendous impact...............for the worst.
Angie, I have had clients attend the tax tribunal to get their taxes lowered based on sale price and SEV, but to no avail. Michigan govt is in trouble too and they are not about to give up their taxes.
That's why it's called a buyers market ! Great opportunites. Now if they could just sell their homes and move up.
OUCH!! That is a huge compensation. Good for you is you are with Pfizer but not good for all the seller's.
Good for you in turning down that listing. Why go to all that work when you know it is going to go to Prudential relocation. How many people are they relocating?
Marchel, 3500 direct employees. Not including contractual employees, like those who run the day-care, cafeteria etc.
Hmm...you and I will win the lottery and buy em all...then relist at market.
Sally, not let's win the lottery and retire .
Missy...
I don't know very much about your market. But it sure sounds like things are a real mess.
TLW...ROAR!
as a lender i've been involved with buyers for 25+ plus years.
sounds like an excellent buy.
for years the seller has been king. they've had their fun.
buyers turn.
TLW, yea a mess.
Jay, now if the buyers could just sell their current homes and move up.
That does sound like a tough situation. Unless you could get all the relo listings.
Jeff, I really DON'T like relo's and the 35% is a big hit in my marketing dollars.
Missy: Thanks for sharing. I love Ann Arbor and I always think that things must be great in that market and a good place to be a Realtor but I can see that all kinds of things can affect any market. When does google come to Ann Arbor - will this be a plus for these type of situations?
What a tough situation. I imagine it is temporary. Obviously as soon as the Pfizer people are out of town prices will go back to normal. Hang in there!!
Cathy, Google is hear. They have about 50 employees so far and hope to get to 1000 in 5 years. I just sold a house to a Google family. We are thrilled they are here.
Jana, yes but the absorption rate of all these houses in crazy.
Andy, I agree Buyers are golden. Thanks for stopping by, I've missed you. !
Missy,
So that explains the sudden drop in some home prices. I showed two this weekend that suddenly were selling well below their purchase price in 2002.
Well that is a big part of it in Ann Arbor. Where did you show homes. ?
WOW... that is tough! Not good news for the other sellers in the area. I keep trying to remain positive about the MI economy and Real Estate market but it seems like every day you hear more bad than good. It will get better (I hope) we just have to hang in there.
Mike, we were sorta insulated here with all the auto lay-offs and restructuring, Pfizer was a direct hit. Yes, no other choice but to move forward. Thanks for stopping by.
Missy glad you finally put your thoughts in writing- I feel for the non-Pfizer Ann Arbor sellers - how disheartening for them. Gave you a 5! Great info
Hi Missy, That is very interesting information. It gives very interesting insight to what is going on over there. I am from Brighton, not sure if many employees would have lived up this way. Thanks for the post though. Rough times, but there is a shiny side to every coin, light at the end of every tunnel, still looking for the pot of gold though. Good luck!
Cyndee, thanks it has happened in other parts of the country and we will regroup.
Cari, lots of Pfizer people live in Brighton don't they? I think they live all over S.E. Michigan.
ouch! You will be feeling the negative downturn for a long time after this! What Pfizer is doing to help their employee is killing those around them in the community who need to sell without the help of a Pharmaceutical giant.
Jennifer, we expect it to be until 2009 or 2010.
Missy I understand why this is so frustrating - and I would personally be very upset if I owned a home and was looking to sell in that neighborhood :o(
But there may be an upside for the buyers you are working with and capturing on your website - maybe an email to all your buyers so you could work on the buy side of the deals - somebody is going to...
I have 4 buyer agents and they are pretty busy. Lately, I've kept a few for myself. Tons of leads and potential clients. I just wish my listings would sell, and only 2 need reductions in prices, due to the Pfizer on-slot.
Missy...
I am thinking about something. I am a firm believer that sometimes our thoughts have much value and should be shared.
That being the case I want to commend you on putting yourself out there and commenting on other members blog posts the way you do.
It is obvious to me that you have taken "reciprocity" to heart. Just look at how you have developed your readership. You have made me very proud.
But...Please...Don't tell anyone that I have emotions :)
TLW...ROAR!
TLW, Thank you so much, I need this encouragement. I have been in a funk all day about Mike Stankevich. You have put a smile on my face and a warm heart.
:)
Missy, I did not know about the 100K thing. That is terrible for the region. We have Pfizer sellers here in my area too. Our prices were already soft. I recently sold a home for what the buyers paid for it in 1998 and they have put in a new kitchen, finished the basement and done landscaping. It is rough out there right now unless you are a buyer of course. Even they are perplexed with the number of choices.
BTW, thanks for asking me to be on that panel. I am honored. Drop me a line with more info when you have a chance.
Missy - I am late here and wonder if you are still seeing such reductions on Pfizer employee homes. If so, are they selling? This has the potential to do some real damage to market values, especially if the homes are concentarted in the same area.
Maureen, your comment must have passed my by, sorry. Soft? Wow, many of our homes are down past 2001 prices and if you bought after that be prepared to bring money to closing.
Paula, YES, more each day. One person had their house on the market for 355, a buyer came along and said, he would give him 250, take it or leave it. He took it. It is hurting EVERY seller that has no such benefit.
Wow, Missy. That is about all I can say about the Pfizer situation. Very interesting times indeed for Ann Arbor real estate.
WE have NEVER had a market like this one. But, it a tremendous time to buy.
Linda, I understand how the 100K loss on sale works. My data has come from the Ann Arbor News reporting and includes not only the skilled scientists but the ancillary services like cafeteria, day care etc.
In speaking with many sellers from Pfizer the moves are coming in waves of every 2 weeks. And will be almost complete by end of 2008.
It is true many are not getting the buy out's due to owning their homes before the Michigan downturn which started in 2001. It is a sad unfortunate situation for many, many people. Best of success !!