We’ve written in the past about the difficulty faced by owners who invested in a larger, more luxurious home during better economic times. Many owners who bought in the early 2000s have continued to hang onto their homes even as the mortgages may be underwater, in hopes that the prices will recover. In our last post we discussed the generally positive effect this has had on the market in Detroit, where homes these days are selling quickly and at asking price because of lower inventory.

One of the factors in this is that many property owners are adjusting to lower prices in their neighborhoods and are willing to sell for less than they were before. Market trends show substantial cuts in home prices that were once at $1 million or more.

“I think sellers are now resigned to today’s prices and what’s actually selling,” said a spokesperson for a marketing group for luxury homes. “People who are serious about selling are ready to make a deal now, where maybe they weren’t a year ago.”

Some larger mansions have been listed and sold for prices up to 30 percent lower than original asking prices. These homes make up a tiny portion of the overall real estate market and are concentrated in certain parts of the country.

As with any homes sales, these types of transactions involve negotiations among the parties and with lenders and require complex and carefully drafted contracts.

For more information about real estate law and complex property transactions, check out our Oakland County law firm website.

Source: USA Today, “Wealth home sellers capitulate, high end prices drop,” Robert Frank, August 3, 2012.