Big hat tip to SeattleJo, a reader who pointed out to me that last week our local PBS affiliate KBTC aired an interesting episode of their “Northwest Now” program, focused on local real estate.
The whole thing is worth a watch, but the real fun starts at the 5:38 mark, when host Tom Layson has Zillow’s Senior Economist Svenja Gudell and Tacoma agent and former NWMLS head Dick Beeson in studio for some Q&A.
After introducing the guests, Layson confronts Beeson with the chart from this 2008 Seattle Bubble post in which I annotated a graph of falling home prices with bottom-calling quotes from Beeson.
I’m not picking on you here, but I have a little chart from 2007 and 2008 that your friends at Seattle Bubble put together there, and you’ve called the bottom at least three times during the two-year period.
Gudell can be heard laughing in the background.
Layton goes on to ask Beeson if he’s ready to call the bottom again today, to which Beeson’s reply is to hem and haw for a few minutes and not really commit to anything.
Just for grins, here’s an updated version of the chart for today:
I wasn’t able to find any bottom calls since mid-2010 from Dick Beeson. It seems that he may have finally decided to stop setting himself up for ridicule like that.
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Prime season existing-home sales plummet 6.9 percent in West
http://ochousingnews.com/news/prime-season-existing-home-sales-plummet-6-9-percent-in-west?source=Patrick.net
Of course “the West” does not include Seattle because it is a magical place akin to the lost isle of Atlantis where faeries protect inhabitants from the evil lord known as…Reality.
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The contrast in intelligence between the two interviewees is startling. Typical of the profile who enters each respective profession, I would assume.
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I was at an open house yesterday and the agent didn’t tell me the market had “hit bottom”, instead he told me that the market was “firming up”.
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That was pretty boring. Sort of funny though when the host asked the question of where multiple offers are being received. I have no idea why he thought he should ask that question of an economist. Does Zillow somehow track multiple offers? ;-)
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“The bottom is wherever you are in the marketplace today”.
Can someone tell me what the heck this means? Dick?
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RE: Kary L. Krismer @ 4 – I don’t know, I think Dick Beeson getting presented with the classic “Dick Beeson vs. Reality” chart on live tellie is pretty golly funny. Lighten up, Kary.
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RE: wreckingbull @ 6 – Now that you mention that, I was expecting it to be more confrontational based on prior reports. I meant to mention that too.
And, I also meant to mention that Tim should pursue a copyright claim against the PBS station for using his graph! ;-)
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Tim’s boss Glenn sent me an email today pumping Redfin’s performance(I found it in my spam folder):
“Redfin’s Listing Business Set to Double This Year”
“Some of Redfin’s growth is because of our own listing business: 41% of our June listings were under contract in less than 14 days. Every home our agents list gets promoted across our site — now for the first time the #1 brokerage site across the 19 markets we serve — and on our top-rated mobile apps. As a result, our listings get double the traffic on Redfin.com, and we’ve been selling ‘em 15 days faster and for more money than the industry average.”
“Redfin’s data for 19 U.S. markets show June prices increasing 3.0% over last year, with one in four homes under contract in less than two weeks; the week before, CoreLogic reported that May home prices increased 2.0% year-over-year, rising for the third consecutive month.
“Sales Dropped in June, Likely to Recover in August”
“June sales were off 4.5% from May, and we think July will be weak too. In our own business, demand was weak for most of June, but took off just before the 4th of July and has been strong since. At a time of year when we’re usually closing deals not meeting new customers, just last week the number of new home-buying customers contacting an agent jumped 14% over our four-week average.”
Is Glenn the new Dick Beeson or do I smell a public offering of stock coming soon to a neighborhood near us?
Inquiring minds want to know.
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RE: Pegasus @ 8 – Redfin has apparently discovered what I’ve been saying for a few months. This low inventory market is not good for their business model on the buyer’s side. It’s a lot easier to represent sellers right now. So they need to promote the listing side.
That’s normal. We switch our focus from time to time too.
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RE: Kary L. Krismer @ 9 – I don’t think he gave a very good explanation as to why inventory is so low by claiming “the banks have left the building, no one else can fill the gap” while he failed to mention the 40,000 plus homes in this state that are in default and many of those are not on the market not to mention all of the mortgages that are underwater. I wonder why…… ;^)
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By Lo Ball Jones @ 1:
The IQ of people in Seattle is lower, so people will pay an extra $50K for a house here in order to save $20K over the life of the loan by getting a cheaper mortgage rate. The further north of I-90 you get, the more this truth becomes apparent.
Average IQ north of I-90 = 85
Average IQ in Renton = 95
Average IQ in Mississippi = 105
Base your home price offers accordingly.
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RE: Pegasus @ 8 –
public offering of stock on RedFin??…hmmm.lets think about that…while looking at the platform Zipr utilized so well: http://finance.yahoo.com/q?d=t&s=ZIPR ….
Technically superior but if your product your bringing has anything to do with real estate sales to generate income your as toxic as they come in this decade of deleveraging. VC is gonna have to wait a LONG LONG time ( if ever) to cash out on the Red Fin venture.
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you know Tim I hope you are seriously considering getting your RE license, knocking out a couple years, then starting your own Brokerage…
With your platform, media attention you have drawn, and technical expertise I think you are leaving ALOT of money on the table if you don’t try this….Grinding out the hours at RF w/o exploring your own venture over the next decade would be a shame.
If I may……..Seattle Bubble Real Estate Inc. or something like that…with a catch phrase like………”You find em….I write em…”…………
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As long as we are talking about IQ’s I should point out, just because your parents have high IQ’s don’t mean you will get one. Take Dick Beeson for instance. His parents must be geniuses, because they named him “Dick” before they even knew what a dick he would eventually turn out to be. Unfortunately, Dick didn’t inherit these extreme smarts and continually advised people to buy real estate at the most horrible time to real estate in history. And of course, Dick followed his own advice and ended up in bankruptcy. Why anybody would ask this imbecile for real estate advice is purely beyond me. People would be much better off getting advice from an 8-ball.
http://business-bankruptcies.com/cases/richard-e-beeson-and-robin-l-beeson
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Poor Dick Beeson really is flailing. If only he’d kept up on the Seattle Bubble, he could have countered that the non-distressed median has been flat for years.
http://seattlebubble.com/blog/2012/07/09/non-distressed-median-price-up-2-4-from-2011/
Of course, we only remember this when the unadjusted median is going up.
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By Pegasus @ 10:
I don’t think much of that session was very informative, even for a consumer, and that’s part of the reason I found it boring.
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By ray pepper @ 13:
That worked really well over at RCG. /sarc
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RE: whatsmyname @ 15 – Yes, that’s true, and it’s also true down in his area–Pierce County.
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RE: Kary L. Krismer @ 4 –
Calling Zillow in any way economically sound or ethical is a stretch though, as they retroactively fix their past Zestimate data to fit past prices and make Zestimates appear more predictive. I’ve brought this up as an unethical practice several times, but no one really cares.
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RE: Doug @ 19 – I don’t think I was doing that, and clearly I wasn’t intending that. I was just describing the title of the Zillow representative–an economist.
I will say though I’m not as bothered by the practice as you, probably because I don’t pay any attention to their numbers.
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RE: Jonness @ 11 –
Ha ha, where did you get those figures?
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RE: Kary L. Krismer @ 20 – I’ve found both Zillow and other sites like Trulia to be curious things – at least in terms of how they “priced” relatively similar condos in our neck of the woods to our own when we put it up for sale. In a lot of cases they were wildly inflated in their estimates, and after looking at comparable listings in the MLS we often couldn’t discern just what kind of underlying numbers they were basing their estimates on. Not to mention Trulia’s rental section for Portland – in over a dozen instances I talked to realtors who said that the property listed as a rental was anything but, and that they were often closing on the same housing unit that very week when I called them up. They had no idea where Trulia was getting the idea that the properties listed for sale had some kind of rental option attached.
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RE: DMac @ 22 – A large part of the reason Zillow isn’t accurate on price is because they rely heavily on assessed values, which are also not accurate.
As to the Trulia rental thing, that could be rental scammers, like are common on Craigslist. I’ve not noticed it on Trulia, but that would be a likely explanation. What scammers do is copy the listing pictures and then claim to be an out of country owner who needs to rent, and they make the rental price extremely attractive. It’s been a long-term problem. I wrote a piece on it over two years ago.
http://blog.seattlepi.com/realestate/2010/03/30/what-agents-should-know-about-craiglist-fraud/
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RE: Kary L. Krismer @ 23 – That makes sense – we had a heck of a lot of trouble dealing with that very issue when we had no other options for finding rentals in Portland other than Craigslist. Since the rental occupancy rate in Portland proper is around 97%, opportunities for scammers abound, particularly concerning out – of – state folks like ourselves.
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RE: Kary L. Krismer @ 20 –
I’m not suggesting you were expressing an opinion there, Kary :-)
I just don’t like that they are falsifying data (changing/removing past Zestimate data to make it look more predictive and accurate) and people just shrug and say “well, it’s free to the end-user.”
It’s not free to their advertisers, or their shareholders. And that shouldn’t matter. Changing past data is unethical. Period.
Their lack of accuracy is another issue entirely, and one I don’t have an issue with, really :-) They’re off all the time. But their historic Zestimates should REFLECT that. People go back, and they see this Zestimate data that hits close to the sale price, and it’s total BS. There’s no way to look at past Zestimates to see how they were high or low.
EX: when we bought our house, we bought it for $30k below the Zestimate. Now it reads that we bought it for $2k more than the Zestimate. What a bunch of hooey. They should be fined.
Gudell has no right to snicker at anyone. Retroactively fitting data to a curve and presenting it as a complex, predictive algorithm that provides value doesn’t take any kind of skill. It just takes complicity on the part of the masses. Even The Tim doesn’t really think it’s a problem. And he’s an engineer.
The common response is “well, I think Zestimates stink anyway, so who cares if their business practices are unethical”. That’s like saying “I’m not a Bank of America customer, so who cares if they foreclose on a few people without cause.”
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I should clarify that my Zestimate is looking quite rosy indeed, this is not a case of sour grapes. It’s just I’m an engineer that deals with federal auditors and presenting evidence, and Zillow’s data-falsifying practices just absolutely horrify me.
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RE: Doug @ 26 – No need to explain. Most people don’t like Zillow for one or more valid reasons.
For the people you mention, those unhappy with a low Zestimate, what I always say to them is it really doesn’t matter. Not many buyers look at Zestimates.
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The bottom is definitely in. Two facts:
1) Beeson refusing to call bottom
2) Zillow calling bottom – http://finance.yahoo.com/blogs/daily-ticker/housing-bear-turns-cautiously-bullish-201746965.html;_ylt=Aox2Xtwig02bM6HWncRfUF2iuYdG;_ylu=X3oDMTQ0ZWhpNzJ2BG1pdANGUCBUaGUgRGFpbHkgVGlja2VyBHBrZwNmZTdjMmY0MS0wYmYzLTNmZjctYmQ2Mi1mZDlmMGFjNTA0NDUEcG9zAzEEc2VjA01lZGlhU2VjdGlvbkxpc3QEdmVyAzYxZTQxOWEwLWQ1ZDMtMTFlMS1iZTJmLTg5YzExYjIzOTA2OA–;_ylg=X3oDMTFpNzk0NjhtBGludGwDdXMEbGFuZwNlbi11cwRwc3RhaWQDBHBzdGNhdANob21lBHB0A3NlY3Rpb25z;_ylv=3
This can mean only one thing – Earth’s magnetic field will be switching soon.
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The bottom is in. It’s already over. Take it from someone who called the top.
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