Mid-Week Open Thread (2011-02-16)

Here is your open thread for the mid-week on February 16th, 2011. You may post random links and off-topic discussions here. Also, if you have an idea or a topic you’d like to see covered in an article, please make it known.

Be sure to also check out the forums, and get your word in the user-driven discussions there!

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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. Tim also hosts the weekly improv comedy sci-fi podcast Dispatches from the Multiverse.

21 comments:

  1. 1
    Cheap South says:

    I’ll bring a question here before I dive into Google. I have a relative that is selling a very small office (1200 sq.ft. building), to a doctor (he owns the other half of the building). They have agreed on the price, my relative does not have a mortgage, and the doctor will pay “cash”. It looks like a clean, straight forward operation between two owners. Can a RE attorney take care of the complete operation? Does each party need an attorney? If an attorney is needed, any ballpark figures of how much do they charge?

    Thank you

  2. 2
    The Tim says:

    By Cheap South @ 1:

    Can a RE attorney take care of the complete operation? Does each party need an attorney? If an attorney is needed, any ballpark figures of how much do they charge?

    1) Yes.

    2) “Need?” No. But if they both want to make sure their own interests are fully represented, they probably should.

    3) For something like this I’m pretty sure that you wouldn’t be paying more than $2k, but I couldn’t say for sure.

  3. 3
    Fran Tarkenton says:

    RE: Cheap South @ 1 – A single attorney handling an agreement for two parties that have independently reached an agreement is not uncommon, but, personally, it raises all kinds of ethical issues that I’d stay far away from.

  4. 4

    Renting is King Now

    SFHs are becoming the Seattle area dinosaur, as household incomes continue to deteriorate with time….apartments will fill our new 3rd world economy needs?

    http://finance.yahoo.com/news/Apartments-pushed-home-apf-82483276.html?x=0&sec=topStories&pos=5&asset=&ccode=

  5. 5

    By The Tim @ 2:

    By Cheap South @ 1:

    Can a RE attorney take care of the complete operation? Does each party need an attorney? If an attorney is needed, any ballpark figures of how much do they charge?

    1) Yes.

    2) “Need?” No. But if they both want to make sure their own interests are fully represented, they probably should.

    3) For something like this I’m pretty sure that you wouldn’t be paying more than $2k, but I couldn’t say for sure.

    I never practiced as a real estate attorney (other than doing sales for bankruptcy trustees and voiding deeds of trust on bankruptcy grounds), but I suspect when you’re using one attorney for both parties they’re acting more in the role of an escrow–neutral–or a dual agent real estate agent.

  6. 6
    SeaBuyer says:

    What’s with all the “pending” status that seems to be flooding in over the last two weeks?
    My favorites list in redfin is showing many home going into “pending” status lately and some of them have been on the market for just about a month and are clearly overpriced. I’m not surprised if we see a small increase in prices during Feb.
    What’s causing it though? Mortgage rates seem to be going up, so are people just jumping in to lock in rates or …?

  7. 7
    Marc says:

    Both Fran and Cary are correct that having a single attorney draft the agreement would require the attorney to act as a third party neutral. In short, this would mean they represent both parties and cannot put either party’s interests ahead of the other. In practice this is often not pleasant to do for an ethical attorney because they may recognize when one party or the other is making a mistake. Due to the attorney’s neutrality he or she is not in a position to advise that party to avoid the mistake as doing so would be prejudicial to the other party who stands to gain from the mistake.

    Accordingly, it is prudent for each side to seek out their own independent counsel to avoid this scenario. And that’s often true even in what appears to be a simple, straight forward transaction (for instance, if one party is overbearing and pressuring the other, the weaker party may benefit greatly by having an attorney stand up for them).

    If the transaction is as simple as you say then I would expect the cost to be well under the $2,000 that Tim mentioned. I’d be happy to speak with you further if you’d like to contact me.

  8. 8
    Cheap South says:

    Thank you all for your input.

  9. 9

    RE: Cheap South @ 8 – BTW, I answered only reading the portion of your question that Tim quoted. Having now read your entire post I would question whether that particular transaction is as simple as you think. If it were purchasing a SFR from someone unknown it probably would be (and I recently directed someone here to use an attorney’s services instead of my own in that type of situation). But given there’s an ongoing relationship between the buyer and seller, it might be more necessary than typical to get separate legal counsel. There might even be a way to minimize excise tax or some other tax.

  10. 10
    Cheap South says:

    RE: Kary L. Krismer @ 9

    Thank you Kary. They’ve been professional neighbors for about 10 years with an excellent friendly relationship. They agreed on the price over coffee in 1 minute. I already passed on the consensus advice from this forum (one attorney for each party).

  11. 11
  12. 12
    Pegasus says:

    Why Isn’t Wall Street in Jail? Matt Taibbi again.

    Financial crooks brought down the world’s economy — but the feds are doing more to protect them than to prosecute them.

    Over drinks at a bar on a dreary, snowy night in Washington this past month, a former Senate investigator laughed as he polished off his beer.

    “Everything’s f@#ked up, and nobody goes to jail,” he said. “That’s your whole story right there. Hell, you don’t even have to write the rest of it. Just write that.”

    I put down my notebook. “Just that?”

    “That’s right,” he said, signaling to the waitress for the check. “Everything’s f@#ked up, and nobody goes to jail. You can end the piece right there.”

    Nobody goes to jail. This is the mantra of the financial-crisis era, one that saw virtually every major bank and financial company on Wall Street embroiled in obscene criminal scandals that impoverished millions and collectively destroyed hundreds of billions, in fact, trillions of dollars of the world’s wealth — and nobody went to jail. Nobody, that is, except Bernie Madoff, a flamboyant and pathological celebrity con artist, whose victims happened to be other rich and famous people.

    Much more: http://www.rollingstone.com/politics/news/why-isnt-wall-street-in-jail-20110216?page=1

  13. 13

    RE: Pegasus @ 12 – Not everything that results in harm is criminal, and that which is criminal may be difficult to prove. Please allege a specific crime rather than just claim there should be prosecutions.

    Last week some member of Congress called for jail time because Chase violated the Solider and Sailor Relief Act by foreclosing homes of service people. I haven’t looked thoroughly, but I’d be shocked if the act provides for any form of criminal liability, but some member of Congress wanted to grandstand and call for jail time. Pathetic, but members of Congress are legally protected when they say things on the House Floor that are totally false and outrageous.

  14. 14

    RE: Pegasus @ 12

    Pegasus, Have You Watched That TV Show Boardwalk Empire?

    The gangster leaders then remind me of today’s, i.e., Chanber of Commerce gathering like “witches at black sabbaths”, to discuss uncontrolled growth control and how laws they blatantly ignore aren’t in their best interests and who cares about what the voters want anyway. LOL

  15. 15
  16. 16
    TheHulk says:

    Interesting article on how the NAR does its calculations. Fairly astounding that even in this day and age of computerization, they rely on a 40% reporting sample for their reports.

    http://www.calculatedriskblog.com/2011/02/nar-reponds-to-questions-of-overstating.html

    Although I can see how this skews the national picture, I dont think this has a big impact on local sales right? I mean when they say they sold 1000 SFHs sold in King county last month, not taking into account delayed reporting and such, at least 1000 transactions were recorded in that calendar month somewhere.

  17. 17

    RE: TheHulk @ 16 – Part of the reason I don’t like using NAR data (besides the fact that it is national), is that they do get their data from many different sources. Look at how many issues we’ve had with just one MLS! If you don’t understand what they’re reporting, you can’t make any sense of it. And if different MLS report differently, you’re not really reporting anything.

    As to your last sentence, no. If they report 1500 sales it just means that 1500 sales were reported to them in that month. It doesn’t mean that there were actually 1500 sales recorded. There would be at least 1500, however, unless the number of late reported in that month were greater than the number of late reported for that month (something that can only be determined months later).

  18. 18
    pfft says:

    By softwarengineer @ 14:

    RE: Pegasus @ 12

    Pegasus, Have You Watched That TV Show Boardwalk Empire?

    The gangster leaders then remind me of today’s, i.e., Chanber of Commerce gathering like “witches at black sabbaths”, to discuss uncontrolled growth control and how laws they blatantly ignore aren’t in their best interests and who cares about what the voters want anyway. LOL

    don’t forget those stooges at the new york times!

  19. 19
    pfft says:

    By TheHulk @ 16:

    Interesting article on how the NAR does its calculations. Fairly astounding that even in this day and age of computerization, they rely on a 40% reporting sample for their reports.

    polling is pretty accurate and they call maybe 1,000 people.

  20. 20
    TheHulk says:

    RE: pfft @ 19

    You know once in a while you might try clicking and reading the link people provide. Did you even read this part – CR’s conclusion: “So the revisions should come this summer. I expect the NAR to revise down sales for the last 4 or 5 years, with significant downward revisions for 2009 and 2010 (CoreLogic estimated 15% to 20%). ”

    Even if the drop-off is 10% (half CoreLogic’s estimate) that is truly astounding. What justification do you have for your claim that the polling is accurate?

  21. 21

    RE: TheHulk @ 20 – In pfft’s defense, I think he was just talking about sampling generally, such as polling. Sampling can be very accurate, once you get a statistically significant number, such as the 1000 he mentioned. It can also not be if the sampling is not done right.

    Prior to computers the statistical error in some samples was possibly less than if you’d counted the entire population, due to counting errors, depending of course on how you counted.

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