Friday Flashback: Lawrence Yun: “Seattle is Underpriced”

Wow, how could I forget this gem from November 2007? National Association of Realtors “Chief Economist” Lawrence Yun: Seattle a "superstar" market

Lawrence YunSeattle is becoming a “superstar” market, where housing costs may never settle back into historical relationships to incomes, a national analyst declared on Tuesday.

Speaking at the annual conference of the National Association of Realtors, association Chief Economist Lawrence Yun used comparisons of mortgage payments to incomes to put much of the nation in a positive light.

“If anything, middle America appears to be under priced,” he said.

But it’s also possible that some [coastal cities] are joining the ranks of international cities like London, Paris, San Francisco and New York, where costs are less tied to incomes, he said. “Now I’m beginning to think: Miami, Seattle, are they becoming superstar markets?”

Many wealthy baby boomers are moving to Miami, Yun said. “In Seattle, Microsoft millionaires are there.”

While the Seattle area’s job market is still strong, Yun said the affordability crunch caused by rising home costs would slow sales and cause prices to plateau.

“I feel that the Seattle market is very healthy in terms of the local job market conditions,” he said. “I don’t see any prolonged price declines.”

Lawrence Yun has since moved on to a successful career as a stand-up comedian. Wait, nope. He’s still the NAR’s primary mouthpiece, despite having been completely and thoroughly discredited.

“Going into 2008, I see it as a year of opportunity,” he said.

Flashing an image of stampeding horses, Yun said: “It’s just a question of unleashing this pent up demand to the market.”

Yun predicted prices would remain essentially flat in 2008, while sales would increase slightly.

“We are hitting low right now,” he said.

Just a few months after these claims, he was at it again in February 2008: Economist: Seattle-area home prices manageable for typical workers

Seattle-area home prices are manageable for typical workers, according to the chief economist for the National Association of Realtors.

“You may even say Seattle is underpriced if you believe Seattle is becoming a superstar city,” Lawrence Yun told area brokers in Bellevue on Thursday. “Seattle is underpriced in relation to other West Coast markets.”

We took on both of these pieces when they were published. You can read Deejayoh’s response to the November 2007 nonsense or my reaction to the February 2008 malarkey.

The purpose of our Friday Flashback series is to remind people why it’s never a good idea to base your home purchase decisions on the word of someone with a vested financial interest in selling as many homes as possible for as much as possible, no matter what. If you’ve got a good example of local home salespeople or other industry shills on record making fools of themselves in the years before the bubble burst, shoot me an email.
  

About The Tim

Tim Ellis is the founder of Seattle Bubble. His background in engineering and computer / internet technology, a fondness of data-based analysis of problems, and an addiction to spreadsheets all influence his perspective on the Seattle-area real estate market.

86 comments:

  1. 1

    Yun asked ” Miami, Seattle…are they becoming superstar markets?”
    Bad enough he declared Seattle a superstar market, but didn’t Miami suffer some of the biggest home price declines in the nation?
    And now for our next segment, “Real Estate Industry Spokemen High on Crack.”

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  2. 2
    sofwarenginer says:

    Here’s Hoping Pundits Like Him

    Followed their own advice and saw their big income real estate deal(s) destroy their own wealth too.

    IMO, we’ve evolved into a new paradigm, the ones staying out of real estate debt, even with much smaller single incomes, now have all the wealth. Hades, even my 1999 SE King County Property Tax Assessment was 28% higher than the 2012 one I received in the mail this week, which plummetted 38% from 2011’s.

    And these King County tax assessments are generally over-exagerated. Thank God I bought in 1999 way below what I qualified for, or my wealth would have been butcher axed far worse [albeit, I would have lived in an apparently nicer/bigger house with much bigger savings sucking utilities].

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  3. 3
    wreckingbull says:

    I love how Larry is titled “Chief Economist”, and at the same time uses the word “Superstar”.

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  4. 4
    David Losh says:

    Sorry to say, but both Tim, and Deejayoh, then went out and bought houses.

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  5. 5
    The Tim says:

    RE: David Losh @ 4 – Yeah, I did buy a house… three and a half years later, at a price roughly a quarter cheaper (based on the change in the CS-HPI) than people were paying when Yun was making ridiculous claims like “we are hitting low right now” and “Seattle is underpriced.”

    What’s your point?

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  6. 6
    Blurtman says:

    Wait a minute. Yun is not an Ivy Leaguer. That explains it.

    Rate this comment: Thumb up 0

  7. 7
    corndogs says:

    He’s originally from S Korea. The country with the smallest weiners in the world… Who cares what he thinks is a Superstar.. My 3 year old nephews got a bigger dong than this guy….
    http://cltampa.com/dailyloaf/archives/2011/03/28/a-world-map-of-penis-sizes-which-countries-have-the-largest-and-smallest

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  8. 8
    Tim McB says:

    But wait Seattle IS a “Superstar” City. Business Week/Bloomberg just said so ;)

    http://blog.seattlepi.com/thebigblog/2012/09/27/seattle-is-better-than-all-of-these-cities-says-ranking/

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  9. 9
    A says:

    What possible metrics could he have been looking at to determine that middle America was cheap in 2008?

    By the way, has anyone tried to bring tax assessed values to market values? I purchased my home almost 22% below the assessment, but the revision process seems deliberately cumbersome. You have to call and debate someone!

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  10. 10
    Blurtman says:

    RE: Corndogs @ 7 – Your nephew no Gangnam. Rocking!

    http://www.youtube.com/watch?v=60MQ3AG1c8o

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  11. 11
    corndogs says:

    RE: A @ 9 – I just did that in Pierce County.. there was a 60 day time window following reciept of the valuation. In Pierce County it is called the “Board of Equalization”… You fill out some paperwork and they grant you a hearing… haven’t had the hearing yet…. If you want to do it there are timelines… so don’t wait.

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  12. 12
    David Losh says:

    RE: The Tim @ 5

    The point is that it is still a bubble, and your house sold for half what you paid for it, before the flipper got a hold of it, and borrowed three times it’s value.

    Essentially the price point of your block, before the remodels, was approximately $125K.

    Your house is the anchor that is increasing the sales data to justify a higher price point.

    Just because the first bubble deflated a little doesn’t mean we are close to complete.

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  13. 13
    Tim McB says:

    RE: A @ 9

    you can do it on your own but there’s a local company that will make it a simple process. Check out http://ValueAppeal.com/ If you truly are overassessed they’ll tell you. They charge a fee to set you up to challenge your local tax office but if you can save money I’d do it. ( PS I don’t work for Value Appeal and I believe that they’ve been a sponsor of Seattle Bubble blog before)

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  14. 14
    corndogs says:

    You should be nice to ‘The Tim’, if it wasn’t for this site you’d be sitting home alone rocking back and forth reciting Abott and Costellos ‘Who’s on First’ to yourself over and over every night.

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  15. 15

    By A @ 9:

    By the way, has anyone tried to bring tax assessed values to market values? I purchased my home almost 22% below the assessment, but the revision process seems deliberately cumbersome. You have to call and debate someone!

    You have to formally appeal. Talking to them is very unlikely (or totally unlikely) to get any results.

    Appealing would preferably require an attorney, but they probably have a lot of self-help guidance available, and as mentioned there’s also the site: valueappeal.com which might be able to help.

    Keep in mind that buying an REO or short sale for below market value does not mean that your assessment should decline.

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  16. 16
    Lo Ball Jones says:

    Ok so where is this in Seattle:

    http://www.zillow.com/homedetails/12911-Westhorpe-Dr-Houston-TX-77077/28123991_zpid/

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  17. 17
    wreckingbull says:

    Good back-story to this blog post:

    http://online.wsj.com/article/SB123152099299568447.html

    FTFA:

    “Mr. Lereah, who says he left NAR voluntarily, says he was pressured by executives to issue optimistic forecasts — then was left to shoulder the blame when things went sour. “I was there for seven years doing everything they wanted me to,”

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  18. 18
    ray pepper says:

    RE: Corndogs @ 7

    I find this compulsion to always read the faded out posts..This one caught me completely off guard because it was so out in left field. HOWEVER, I absolutely busted out laughing because Corndog placed a link to support his theory..

    Stop fading out posts Tim. I’m drawn to them like my kids entering an amusement park.

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  19. 19
    The Tim says:

    By David Losh @ 12:

    …your house sold for half what you paid for it, before the flipper got a hold of it, and borrowed three times it’s value.

    You really don’t know what you’re talking about.

    Here’s the sale history for my home:

    • April 1980 – $74,500
    • February 2006 – $267,000
    • July 2006 – $364,000
    • May 2011 – $224,950

    The last time my home sold for less than what I paid was in 1980, after which it was held by the same family for 26 years. The only flipper that has held my house paid $42,000 more than what I bought it for, and they only borrowed $253,650 because all they did was hold it for a few months without making any improvements whatsoever.

    The new kitchen, bathroom, and other work was done by the family I bought it from. After paying $364k for the home in July 2006 (100% financed) they proceeded to pour who knows how much cash into all the improvements they made, which they were doing for themselves thinking they would stay in the home long-term, not as any kind of attempted “flip.”

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  20. 20
    Mike says:

    Gotta love it. The home I bought I could have never afforded on 2 incomes in 2007, and now it’s fairly affordable on one. Does this mean Seattle is sub-super?

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  21. 21
    ray pepper says:

    RE: The Tim @ 19

    “You really don’t know what you’re talking about.”

    Now Tim….has that stopped anyone here before…………

    “Your house is the anchor that is increasing the sales data to justify a higher price point. ” =Priceless!

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  22. 22
    David Losh says:

    RE: The Tim @ 19

    I know exactly what I’m talking about. Your house, along with millions of others are still selling for bubble prices.

    Pointing backwards to Yun is some kind of justification, I guess, but I really can’t figure out this fascination you have with the past.

    Probably more economic devastation is being done since 2009, than the years between 2005 to 2008.

    BTW, so you paid close to 2006 pricing at a short sale?

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  23. 23
    Azucar says:

    Yeah, it’s funny how Losh uses his theory to “prove” that the data which shows his theory is wrong is just anomalous data…

    “Yes, the value of all those places that people are paying $250k for is $125k, and I know this because people are overpaying because the value of those places really is $125K and people are just saying they’re worth $250k because that is how much people are willing to pay for them.”

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  24. 24
    David Losh says:

    RE: Azucar @ 23

    Really?

    The value is determined by how much a bank will lend on them.

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  25. 25
    David Losh says:

    RE: The Tim @ 19

    OK, the Azucar person made me look it up, and what is the item on the Assessor Records from 2004 for $153,745, and the foreclosure in 2005 for $121,997?

    and I was just guessing before because of the sale of the house up your street.

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  26. 26
    corndogs says:

    RE: Kary L. Krismer @ 15 – Actually, here is the law concerning valuation (see below). It doesn’t matter if you bought a foreclosure or short sale… Your purchase of the house is the event that best meets the criteria for determining valuation… presumably you also have an independent appraisal that backs up your position… I’ve talked to the Pierce County Board of Equalization on the phone and they indicated that my valuation would likely be dropped down to my purchase price even though it was a bank repo.. I see nothing in the law that would allow them to argue otherwise…..

    WAC 458-07-030 True and fair value — Defined — Criteria — Highest and best use — Data from property owner. (1) True and fair value — Defined. All property must be valued and assessed at one hundred percent of true and fair value unless otherwise provided by law. “True and fair value” means market value and is the amount of money a buyer of property willing but not obligated to buy would pay a seller of property willing but not obligated to sell, taking into consideration all uses to which the property is adapted and might in reason be applied.

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  27. 27

    By The Tim @ 19:

    By David Losh @ 12:
    …your house sold for half what you paid for it, before the flipper got a hold of it, and borrowed three times it’s value.

    You really don’t know what you’re talking about.

    What you don’t understand is that it became more profitable for all the prior owners of your home to not own your home because they expected the decline in the price of natural gas to slash the value of your house, but for some reason it didn’t. When you look at it that way, you made a horrible decision to buy a home. ;-)

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  28. 28
    Feedback says:

    Thank you, Tim. You’re smarter than Lawrence Yun.

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  29. 29

    RE: Corndogs @ 26 – I would disagree with your analysis of that WAC. The WAC is talking of a hypothetical buyer and seller, not an actual buyer and seller.

    That one person is willing to pay a price for a particular piece of property does not conclusively mean that property is worth that amount. If that were true, then the banks have been wasting a lot of money on appraisals.

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  30. 30

    By Corndogs @ 26:

    RE: Kary L. Krismer @ 15 – Actually, here is the law concerning valuation (see below). It doesn’t matter if you bought a foreclosure or short sale… Your purchase of the house is the event that best meets the criteria for determining valuation… presumably you also have an independent appraisal that backs up your position… I’ve talked to the Pierce County Board of Equalization on the phone and they indicated that my valuation would likely be dropped down to my purchase price even though it was a bank repo.. I see nothing in the law that would allow them to argue otherwise…..

    Re-reading what you wrote, particularly the highlighted part, I now agree with it, I think. If you’re saying that they can consider your sales price even it if were a short sale or foreclosure, I would agree. If you’re saying that sales price is conclusive, I would not agree.

    I would agree if you said it is “an event that meets the criteria for determining valuation.” I’m not comfortable with the “best meets” part.

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  31. 31
    corndogs says:

    RE: Kary L. Krismer @ 29 – Bank appraisals have nothing to do whatsoever with county tax assessments, so you have a fallacious argument in regards to that. In regards to the rest…

    There is nothing in the law that indicates that actual transactions do not apply… obviously, in lieu of an actual recent sale, comparables must be used… but if there is an unencumbered sale of the house in question within the applicable time frame, that value will be used..

    As I said, I did talk to a member of the Board of Equalization and she told me without hesitation that my assessment would be brought down to what I paid, given that the transaction occured within the time period applicable for that years taxes. Obviously, there is no better example of a ‘True and Fair value’ as the law describes it then an actual free transaction made on the house in question…

    There is also nothing about a REO that changes the criteria of the law in regards to buyer/seller being willing or obligated, so it doesn’t matter whether it is REO or not.

    In the past, when choosing comps to value homes with no recent sales… they omitted distressed sales…. but I was also informed that in Pierce County, at least, this is no longer the case… they got their hinnys reemed by the citizens and now they do include these…. because of the high volume of distressed properties which became the new norm over the last several years, they can not be ignored…

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  32. 32
    corndogs says:

    RE: Corndogs @ 31 – Krismer @ 30 – I typed this last response before I read your latest post…

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  33. 33

    RE: Corndogs @ 31 – You need to quote more of the WAC–the portion following what you quoted.

    (2) True and fair value–Criteria. In determining true and fair value, the assessor may use the sales (market data) approach, the cost approach, or the income approach, or a combination of the three approaches to value. The provisions of (b) and (c) of this subsection, the cost and income approaches, respectively, shall be the dominant factors considered in determining true and fair value in cases of property of a complex nature, or property being used under terms of a franchise granted by a public agency, or property being operated as a public utility, or property not having a record of sale within five years and not having a significant number of sales of comparable property in the general area. When the cost or income approach is used, the assessor shall provide the property owner, upon request, with the factors used in arriving at the value determined, subject to any lawful restrictions on the disclosure of confidential or privileged tax information.

    (a) Sales. Sales of the property being appraised or sales of comparable properties that occurred within five years of January 1st of the assessment year are valid indicators of true and fair value.

    You can come in with your sale. The county is free to come in with other sales if they don’t agree to make the adjustment you want.

    Hopefully what the person at the county told you will come true. What government employees say isn’t binding on government. They might even fail to make any adjustment if you didn’t appeal in time.

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  34. 34
  35. 35
    Mel Torme says:

    RE: Corndogs @ 7

    OK, I just had to paste this in to read it more clearly:

    He’s originally from S Korea. The country with the smallest weiners in the world… Who cares what he thinks is a Superstar.. My 3 year old nephews got a bigger dong than this guy….
    http://cltampa.com/dailyloaf/archives/2011/03/28/a-world-map-of-penis-sizes-which-countries-have-the-largest-and-smallest

    Reply – Quote

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  36. 36
    Mel Torme says:

    RE: Mel Torme @ 35RE: Mel Torme @ 35

    Rate this comment: Thumb up 0 Thumb down 1

    1 South Korean SEATTLEBUBBLE readers, named Lawrence Yun INTENSELY DISLIKES Mel Torme on Facebook.

    SEATTLEBUBBLE reader Mel Torme DOES NOT GIVE A CRAP ABOUT SEATTLEBUBBLE reader Lawrence Yun and his silly red thumbs-down.

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  37. 37
    corndogs says:

    RE: Mel Torme @ 35 – corndog isn’t on fscebook or linkedin….so no maky sensy..

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  38. 38
    The Tim says:

    By David Losh @ 25:

    …what is the item on the Assessor Records from 2004 for $153,745, and the foreclosure in 2005 for $121,997?

    Apparently what it is, is an error in whatever tool you’re using to look at the assessor records.

    My home‘s complete sale history since 1980 is listed above.

    The crappy little shack next door to me was sold for $153,745 in 2004, and foreclosed in 2011.

    I don’t know what home around here was foreclosed in 2005 but not mine or the one next door.

    Instead of using whatever broken tool you’re trying to look things up in, how about going straight to the actual assessor website? Click the links in this comment for proof of what I’m telling you.

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  39. 39

    By The Tim @ 38:

    By David Losh @ 25:
    …what is the item on the Assessor Records from 2004 for $153,745, and the foreclosure in 2005 for $121,997?

    Apparently what it is, is an error in whatever tool you’re using to look at the assessor records.

    Dave’s apparently using Realist, the NWMLS tool.

    The 2004 item is a Realist error. That item is for the west 36 feet of two lots, and you own the two lots except the west 36 feet.

    The 2005 item is a notice of trustee’s sale, and that is clearly stated on Realist as such. David just doesn’t know what that means. The dollar amount is what was owing at the time. Apparently the foreclosure was never completed, presumably because they sold or otherwise brought the debt current.

    In summary, Dave is basing his opinion on erroneous information, information he doesn’t understand, and apparently this:

    http://www.ioga.com/Special/crudeoil_Hist.htm

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  40. 40
    corndogs says:

    RE: Kary L. Krismer @ 33 – Well, you can go on and on about, maybe the lady doesn’t know what she’s talking about, and maybe I filed late etc…. but, I showed you the law, I filled out the petition, I talked to them in person and I understand the situation..

    I’ve read the whole WAC, nothing you posted regarding alternate approaches apply in this case…There is nothing complex in nature about my house so those other approaches won’t be used.

    The Board is an independent entity separate all together from the assessors office. The woman I talked to is a member of the board…. If you want to doubt what I’m telling you that’s up to you… but the Corndog has several family members that have done this through the years. If you get your crap together and you’ve a valid argument you’re going to win… the sale of the house in question is an example of a valid agrument and my appraisal willback that up… I’ll let you guys know how it goes….

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  41. 41
    Mel Torme says:

    oops, Tim must have spilled milk on my post somehow. Here you go: (no problem)

    RE: Corndogs @ 7 –

    OK, I just had to paste this in to read it more clearly:

    He’s originally from S Korea. The country with the smallest weiners in the world… Who cares what he thinks is a Superstar.. My 3 year old nephews got a bigger dong than this guy….
    http://cltampa.com/dailyloaf/archives/2011/03/28/a-world-map-of-penis-sizes-which-countries-have-the-largest-and-smallest
    Reply – Quote

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    SEATTLEBUBBLE feedback: 16 South Koreans perused corndog‘s post.

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  42. 42
    Pegasus says:

    RE: Corndogs @ 40 – I bet they use Zillow now to value your home which was a distressed property when you bot it since that is what you keep posting. Hahahaha! That and your bragging posts about how much money you have made off someone else’s misfortune. Do you have the board’s email handy, Bozo?

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  43. 43
    Pegasus says:

    RE: Mel Torme @ 41 – Unfortunately you are encouraging the world’s biggest dickhead…….

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  44. 44

    RE: Corndogs @ 40 – I’m just saying to be careful about relying on what they tell you. If you signed a petition too that probably deals with the appeal deadline. Just be aware you may need more comps than your one sale if they contest it.

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  45. 45
    Mel Torme says:

    RE: Pegasus @ 43

    ********************************************************************************************
    Unfortunately you are encouraging the world’s biggest dickhead…….
    ********************************************************************************************

    Who, corndogs, or the fool who keeps spilling milk or Olympic water stain on top of all my posts?

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  46. 46
    2kt says:

    RE: The Tim @ 5

    Point? Does he ever? Even if there is a thought in the beginning of his sentence, it rarely survives an onslaught of nonsense, and never makes it to the end of it.

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  47. 47
    David Losh says:

    RE: The Tim @ 38

    It’s Realist.

    Rate this comment: Thumb up 0

  48. 48
  49. 49
    David Losh says:

    RE: Kary L. Krismer @ 39

    Nice try.

    Rate this comment: Thumb up 0

  50. 50
    David Losh says:

    RE: The Tim @ 38

    That crappy shack last sold for $60K, which seems about right, maybe a bit high considering it was a foreclosure.

    What you are ignoring, and choose to ignore, is that home prices are still inflated, we are still in a bubble.

    So pointing to the past, and saying we dodged a bullet is false information.

    This is a good article on the credit bubble, which is global: http://seekingalpha.com/article/573611-the-fed-and-credit-bubbles

    You’ve relegated discussion of politics, and economics to a seperate thread when that is what we should be looking at.

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  51. 51
    corndogs says:

    RE: Kary L. Krismer @ 44 – My appraisal for my loan has comps… that’s part of the petition submittal…

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  52. 52
    corndogs says:

    RE: Pegasus @ 42 – making no sense dummy…. post something of relevance.

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  53. 53
    ray pepper says:

    A bunch of Corndogs and Losh, with a touch of Kary, and a bit of Tim is better then most comedies! Keep it up guys and can we please stay with the topic on hand:genitalia..

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  54. 54

    By David Losh @ 49:

    RE: Kary L. Krismer @ 39

    Nice try.

    Nice try? I explained to Tim you were using the Realist service, which you verified in post 47. I explained the mistake that service made (which was obvious to me, but not to you), and your failure to understand one of the things listed in that service.

    You claim that you understand real estate, but you don’t even understand the basics! You can’t read a Realist report on a piece of property and comprehend what it is saying. It’s a good thing you don’t represent buyers of real property. Understanding Realist is critical for buyer’s agents.

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  55. 55

    By David Losh @ 50:

    RE: The Tim @ 38 – That crappy shack last sold for $60K, which seems about right, maybe a bit high considering it was a foreclosure.

    Do you even know how to read listings? That listing said it needed “TLC.” Fannie Mae would only accept cash or a rehab loan on offers. The reason for the low price was due to condition of the property.

    Did you not bother to look at the pictures? It was missing some siding on the outside and I don’t even want to describe the inside. People here may have recently eaten.

    You have access to these tools David. Why don’t you use them before coming here and spouting off a bunch of nonsense?

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  56. 56
    corndogs says:

    RE: ray pepper @ 53 – further evidence, Corndog has a knowledge of all things Great and Small…
    http://en.wikipedia.org/wiki/Ken_Jeong
    http://www.youtube.com/watch?v=cHETXHvbxsY

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  57. 57

    By Corndogs @ 51:

    RE: Kary L. Krismer @ 44 – My appraisal for my loan has comps… that’s part of the petition submittal…

    Excellent! Both that you have it and that you attached it.

    Am I correct in assuming the appraisal came in at exactly what you paid? That’s rather typical currently.

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  58. 58
    corndogs says:

    RE: Kary L. Krismer @ 57 – No my appraisal was substantially higher….however… the comps in the appraisal are from a period preceding my home purchase…So I’ve shown the prices on a trend line going down which is consistent with the actual trend of the market. (This is part of the instructions on the petition). The actual home purchase was the closest data point to the end of the year, which is the point in time they are concerned with. But the trending of comp data is intended for a situation when you do NOT have an actual sale… which of course I do… So this comp data is just supporting documentation which shows by purchase price was in the ballpark of the valuation…

    I’m attempted to reduce my assessment from $800K+ to $500K, this is a big drop. If they use the trend data, it might be $550….. but it sure as hell isn’t going to be $800K… like I said we’ll see….

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  59. 59
    corndogs says:

    RE: Kary L. Krismer @ 57 – My appraisal was greater than 10% higher than the purchase price… do you see that often?

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  60. 60

    RE: Corndogs @ 59 – No, but note I don’t always see the appraisal. On the ones I do see, the appraisal coming in at the exact sales price happens more often than not. They know the sales price.

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  61. 61

    RE: Corndogs @ 58 – You’re right there are few good comps in the area. The much newer one on 94th would be good for you, but it doesn’t have the same view. The more recent one on 83rd would also be good, but it’s significantly smaller.

    How far away did your appraiser go for comps?

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  62. 62
    Pegasus says:

    RE: Kary L. Krismer @ 61 – Let me get this right. Corny Doggy has bragged about buying his home that was a distressed sale at a huge discount to FMV. Corny Doggy then brags about his house being worth $300,000 more than he paid for it. Corny Doggy doesn’t like paying taxes and starts crying about how much he is being assessed. Corny Doggy has filed an appeal at the same time he continues to brag about how smart he is for making all of this money on his purchase. So….is he lying about all the the profits he supposedly made on his purchase or is he about to lie to the appeal board? It can’t be both since the property assessor has to value the house at fair market value which excludes the price he paid since it was a distressed sale.

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  63. 63

    RE: Pegasus @ 62 – I think that pretty well covers it.

    That said, I’m not sure there’s anything necessarily wrong with that, although whoever represents the county would probably love to know that information. Someone can buy a property believing it is worth more than they paid for it, and believing houses in the area are undervalued. They can be right or wrong in their opinion.

    That sort of gets back to my original point though. Just because you bought at a foreclosure or short sale for $XXX,XXX, it doesn’t mean that you’ll get that valuation for taxes. Looking at the few properties I could find over there, his place probably is worth more than $500,000, and is almost certainly worth far less than $800,000. If he submitted an appraisal indicating it was worth more than $550,000, chances are the taxing authorities will find it to be worth more than the $500,000 he paid. We’ll see.

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  64. 64
    corndogs says:

    RE: Kary L. Krismer @ 63 – “That sort of gets back to my original point though. Just because you bought at a foreclosure or short sale for $XXX,XXX, it doesn’t mean that you’ll get that valuation for taxes”. What is your source of info for that statement?….

    You keep making unqualified statements about this issue and you’re starting to sound like Losh. Have you ever honestly been involved with a tax petition?. If not you’ve gone too far with your input on this already… I told you, I was told by one of the people that administer the hearing and they said that IS how it works and I showed you the law and there is nothing in there that contradicts what I’ve learned so far. You want to F around and interpret the wording of the WAC… but you’re not a lawyer……. There are literally thousands of petitions in the system… people file them because it DOES work that way…Soooo at this point, i know a hell of a lot more than you do… so let’s just drop it, and I’ll tell you how it turns out…

    .RE: Pegasus @ 62 Profits are made when you sell something dummy. Are you really callling me Corny Doggy?… Is that the best you can do? I’d rather take some she-ot from Wreckingbung at least he’s remotely intelligent…

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  65. 65
    Pegasus says:

    RE: Corndogs @ 64 – Corny Doggy… It appears the truth, a repetition of your own statements, is too much for you to handle. Do you have the the email of the appeals board that I asked for or do I have to look it up to forward all of your statements here made by you about the value of your house?

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  66. 66

    By Corndogs @ 64:

    RE: Kary L. Krismer @ 63 – “That sort of gets back to my original point though. Just because you bought at a foreclosure or short sale for $XXX,XXX, it doesnâ��t mean that youâ��ll get that valuation for taxes”. What is your source of info for that statement?….

    You keep making unqualified statements about this issue and you’re starting to sound like Losh. Have you ever honestly been involved with a tax petition?. If not you’ve gone too far with your input on this already… I told you, I was told by one of the people that administer the hearing and they said that IS how it works and I showed you the law and there is nothing in there that contradicts what I’ve learned so far..

    I’ve been an expert witness on valuation on a few occasions, but for a tax petition? No. Not enough money involved. Seriously, you’re looking at saving maybe 2-3k. Next year is a new game. Not worth it to hire an expert for that amount.

    In my own case King County did something similar, but not to the same extent. They assessed my property at about 10% over what I paid less than two months before January 1, the valuation date. I thought about contesting it but decided it wasn’t worth my time. It would have only been worth it for the experience, and due to the amounts involved in contesting residential tax assessments, that experience wasn’t worth it. It’s in commercial property that it is worth it, but commercial is not my area.

    As to the law, I quoted above the fact that your purchase price is only one piece of information. It was the rest of the WAC you quoted. Choose to ignore it at your peril. But you’re the one who gave them an appraisal which showed a higher value than what you paid. Do you expect them to ignore that? They might, but I wouldn’t hold your breath.

    What you’re doing is confusing the fact that what you paid is one piece of evidence, but not the only evidence. Nothing you’ve cited changes that.

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  67. 67

    RE: Corndogs @ 64 – BTW, what you fail to realize is that the county has access to the sales information for every piece of property. That’s how they get the information for their comps.

    If it was as you suggest, all the properties sold would be reassessed for their sales price after each sale. It would be automatic. You wouldn’t have to contest it. That’s not how things work.

    But we’ll see. It will be public record soon enough.

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  68. 68
    A says:

    RE: Kary L. Krismer @ 15

    Thanks for the advice.

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  69. 69
    David Losh says:

    RE: Kary L. Krismer @ 55

    Yeah Kary I saw the pictures a long time ago, so why did this property sell for top dollar of $60K? It makes no sense.

    Have you seen the property? Do you know why this buyer would pay a premium price for this crappy shack?

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  70. 70
    David Losh says:

    RE: Kary L. Krismer @ 54

    I’d be insane to engage you, but I have two minutes to point out……

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  71. 71
    corndogs says:

    RE: Kary L. Krismer @ 67 – No, that’s false logic. You need to bring proof that your sale was an unencumbered transaction and meets the requirement of the law.. The county has no idea what the details are of each transaction. That’s why they have their methodology…. So what you are saying has no logical basis. What is logical is to read the laws, talk to people who know what they are talking about; go to the county and get the forms, read the forms. Your speculation on how you think the world should work is not relevant because you keep making false leaps of logic…. .

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  72. 72
    corndogs says:

    RE: Kary L. Krismer @ 66 – “Seriously, you’re looking at saving maybe 2-3k. Next year is a new game. Not worth it to hire an expert for that amount.”

    It’s more like 3-4K for filling out a form!… No expert needed… I’ve spent more time reading what you have to say about it than it took to fill it out!

    “But you’re the one who gave them an appraisal which showed a higher value than what you paid. Do you expect them to ignore that? They might, but I wouldn’t hold your breath.”

    I already explained how the comps in the appraisal were used to show the price trends…. shouldn”t have to explain things more than once…

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  73. 73
    corndogs says:

    RE: Pegasus @ 65 – What e-mail dummy? You’re not making any sense!

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  74. 74

    By David Losh @ 69:

    RE: Kary L. Krismer @ 55

    Yeah Kary I saw the pictures a long time ago, so why did this property sell for top dollar of $60K? It makes no sense.

    Have you seen the property? Do you know why this buyer would pay a premium price for this crappy shack?

    I have no idea what you mean by premium price. $60,000 is not the high range of prices in that neighborhood. Perhaps $60,000 was too much for the house in the condition it was. But that’s not a premium price for that area.

    My point is that it’s clearly not a comp for Tim’s purchase. This was a fixer. Tim’s house was an old house with a fully remodeled kitchen and exposed wood trim through much (if not all) of the house. You might as well use Bill Gate’s house as a comp for Tim’s house.

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  75. 75

    By David Losh @ 70:

    RE: Kary L. Krismer @ 54

    I’d be insane to engage you, but I have two minutes to point out……

    Give it up. You couldn’t read or understand a Realist report, so you were spouting a bunch of nonsense about two transactions on Tim’s property which didn’t exist. Since you don’t know what you’re talking about, so would be insane to engage me. Unfortunately, to date that hasn’t stopped you.

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  76. 76

    RE: Corndogs @ 71 – Read post 33 again.

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  77. 77

    By Corndogs @ 72:

    I already explained how the comps in the appraisal were used to show the price trends…. shouldn”t have to explain things more than once…

    The appraisal and your purchase were after 1/1/2012. The appraiser found the value of your house to be over $500,000 as of a date after 1/1/2012. To the extent the appraiser did note the area as being a declining market, he/she would have already taken a deduction for that in the valuation.

    Stated differently, even accepting the fact that they agree there’s a downward price trend, you’ve established a value over 10% higher on the date of your purchase. The assessment valuation date was before that. So if you want to rely on a trend, the assessed valuation should be higher than your appraisal.

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  78. 78
    David Losh says:

    RE: Kary L. Krismer @ 74

    Kary, it make no difference, you interjected yourself into a nothing conversation with no real information.

    Personal insults seem to be the biggest discussion point here.

    I read the report, and asked the question, without making any assertions.

    It’s just odd that anyone would let you run rough shod on a blog. I don’t need to explain myself, because I do know what I’m talking about, but to me your opinions don’t matter.

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  79. 79

    RE: David Losh @ 78 Asked the questions? You purport to be experienced in real estate matters. Why are you asking the property owner questions? Tim may or may not have access to Realist with his position at Redfin. I don’t know. So I answered the questions you had.

    But my point is you purport to be knowledgeable on real estate matters, but you don’t even know the basics! You shouldn’t have had to ask the questions! Despite all your years in real estate you’re not in a position where you have enough knowledge to represent a buyer on a simple transaction. You need to understand the Realist reports to be able to represent buyers.

    You’re the one who first claimed I didn’t understand real estate. You are in no position to judge that, because clearly you don’t understand even the basics of real estate. You can’t read Realist. You think a $60,000 fixer is somehow relevant to the purchase price of Tim’s house. You don’t know what a Notice of Trustee’s Sale document is. And that’s just in this thread.

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  80. 80
    corndogs says:

    RE: Kary L. Krismer @ 77 – and I also already mentioned that if we used the trend line my value might be slightly higher… yes it matters when the purchase was made….. Going from $826K to $550K… I think I’ll take it..

    You initially indicated that a purchase was not relevant and that being an REO was also significant… you were incorrect on those two points…

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  81. 81

    Here’s what I said that started this exchange.

    By Kary L. Krismer @ 15:

    Keep in mind that buying an REO or short sale for below market value does not mean that your assessment should decline.

    I did not say it was irrelevant.

    In post 29 I said:

    That one person is willing to pay a price for a particular piece of property does not conclusively mean that property is worth that amount. If that were true, then the banks have been wasting a lot of money on appraisals.

    Again, I did not say it was irrelevant.

    In post 30 I said:

    Re-reading what you wrote, particularly the highlighted part, I now agree with it, I think. If you’re saying that they can consider your sales price even it if were a short sale or foreclosure, I would agree. If you’re saying that sales price is conclusive, I would not agree.

    So again I did not say it was irrelevant.

    As to it being an REO, we haven’t really addressed that much. I don’t know how sophisticated the taxing authorities are in determining tax assessments. If they aren’t very sophisticated, they won’t account for the fact that certain sales are REO or short sales, and certain sales aren’t. If you actually get before a hearing examiner, I suspect they would argue that. Only ignorance would prevent them from doing so.

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  82. 82
    corndogs says:

    RE: Kary L. Krismer @ 81 – one last point… the part I need to prove is a seller/purchasers “willingness to buy”. That willingness was established on dec 30 when the purchase agreement was all signed around….you can’t get any closer to year end than that… thatt will be my argument.

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  83. 83
    David Losh says:

    RE: Kary L. Krismer @ 79

    You missed the point, but it makes no difference.

    I looked at the pictures of the shack behind Tim’s house, and figured $24K would be fair.

    The items on the reports make no difference because a property is worth what some one is willing to pay. The VanHorns paid more, but in my opinion they do pay top dollar for properts. They do a nice job, and again, in my opinion, they have been lucky to find people to give them a profit. They are pretty darn good at what they do.

    As I said before, my opinion, is that Tim’s house is worth about $125K based on the sale up the street. You might add value for the remodeling, but I wouldn’t.

    Is that long winded enough for you?

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  84. 84

    RE: David Losh @ 83 – Why would long winded be better. Your’s is the opinion of someone who doesn’t have the slightest clue what they are talking about. The shorter the better. Nothing would be best.

    No value for remodeling? No value for exposed wood trim on an early 20th Century home? I guess the listing agent, selling agent (Marc Holmes), Tim, and the bank’s appraiser don’t know as much about valuing real estate as you. Yep, the house is clearly worth only $125,000, because you say so. /sarc

    You can pull numbers out of your ass all day long, but that’s all you’re doing.

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  85. 85
    corndogs says:

    RE: Kary L. Krismer @ 84 – hey, i didn’t know we could say ass on here! i feel a new level of freedom.

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  86. 86
    corndogs says:

    RE: David Losh @ 83 – Losh .. You’re an ASS! “The Tim” lives around a bunch of pervs, and is probably going to get raped…. but his house is worth more than that.

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