Friday Flashback: “The era of record-low rates is over.”

Heh, remember this piece from April of last year? Homebuyers scramble as mortgage rates jump

The era of record-low mortgage rates is over.

The average rate on a 30-year loan has jumped from about 5 percent to more than 5.3 percent in just the past week. As mortgages get more expensive, more would-be homeowners are priced out of the market — a threat to the fragile recovery in the housing market.

“We are seeing some panic among potential buyers who have not found houses yet,” said Craig Strent, co-founder of Apex Home Loans in Bethesda, Md. “They’re saying: Man, I should have found a house three weeks ago or last month when rates are lower.”

It was funny then, and it’s even more funny now, as rates hit yet another new all-time low, a year and a half later.

Here’s an updated chart of 30-year rates, going all the way back to 1971:

Mortgage Rates

Again, notice that even when rates go up two entire percentage points, they will basically be about where they were during the hottest years of the housing bubble, when real estate salespeople were crowing about how amazing rates were, and what a great time it was to buy because of it.

Of course, at this point I wouldn’t expect rates to rise anytime soon. Demand for borrowed money is in the crapper and probably will be for a while.

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.
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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.

80 comments:

  1. 1

    Don’t forget a lot of people here were predicting higher rates too!

  2. 2
    Lake Hills Renter says:

    Interest rates always go up!

  3. 3
    tomtom says:

    I bought my first house in ’96 with a 7 1/8 % loan. I thought that was a good deal.

  4. 4
    NewHomeOwnerInFremont says:

    My 4.875% is starting to look bad. I am amazed how low these 30 year rates are going.

  5. 5

    The first home I bought was in the late 80s with a rate of 11% using an FHA mortgage. Last week, I did lock in the lowest 30 year fixed that I have in my 10+ years as a mortgage originator. Just a few years ago, 5% was the “low” until 4.5% was hit… and now we’ve seen rates 4% and under for conforming 30. It’s crazy.

  6. 6
    S-Crow says:

    Couple low rates with home prices back to mid to late 90’s prices in some locations…..a very good time to be back in the market or in the market as a first time buyer.

  7. 7
    Lake Hills Renter says:

    By S-Crow @ 6:

    a very good time to be … in the market as a first time buyer.

    I’m trying, but the inventory just isn’t there. At least for what I want.

  8. 8
    S-Crow says:

    RE: Lake Hills Renter @ 7 – Just keep your radar on.

    =)

  9. 9

    By Lake Hills Renter @ 7:

    By S-Crow @ 6:

    a very good time to be … in the market as a first time buyer.

    I’m trying, but the inventory just isn’t there. At least for what I want.

    It really is tough in some areas/price ranges. And there’s been surprisingly little coming on the market right now and many of those same areas/price ranges.

  10. 10
    Tim McB says:

    We’re in the process of refinancing from a 5.0% 30 year to a no cost 4.0% 30 year. I’d say its a pretty decent to refi if you can. I thought my wife and I’s old 3.25% student loans were pretty good. I’m officially going to thrown the towel though on predicting any significant inflation for the next 5-10 years though. For the last couple years up until two weeks ago I had been saying and thinking just a few more months and we’ll see it.

  11. 11
    crashcadia says:

    I am amazed at how long rates have been held low.
    Desparate Times.

    Eventually rates will have to go up as we enter into the “Age of Austerity”.
    Image house prices when we hit 18 to 20% interest. That day will come.

  12. 12
    Urban Artist says:

    I agree with post 7. We are looking but the inventory is either really bad or still overpriced or both. I’m afraid I’m not seeing any 90’s prices S-Crow, at least in the North King County areas.

  13. 13
    Bingo says:

    I must admit that I was in the camp that thought higher interest rates would bring down the housing market with the popularity of ARMs. Didn’t happen.

    If 30 yr mortgage rates dropped to 3.25%, would that be enough to get the housing market going?

  14. 14
    ARDELL says:

    RE: Bingo @ 13

    North King is currently 81% healthy as a market for single family home vs condo. For newer homes close in single family, even the short sales are over priced. How odd is that?

    As much as I hate to drag Kary’s dead horse into this thread, the fear of under pricing short sales is really confusing the marketplace. To Bingo…due to recent changes, you pretty much have to ignore that over pricing and work from the basis that the short sales will likely sell for much lower than those inflated asking prices.

    I say that reluctantly, as I likely just broke a new rule by saying the short sale is over priced. Perhaps along with not under pricing them, the rest of us are supposed to pretend they aren’t over priced?

  15. 15
    Feedback says:

    Congratulations to Tim for defeating the Seattle Times!

  16. 16
    ARDELL says:

    RE: ARDELL @ 14

    Apologies…my response to Bingo was actually to Urban Artist re North King.

  17. 17
    Pegasus says:

    By Feedback @ 15:

    Congratulations to Tim for defeating the Seattle Times!

    I don’t recall the Tim making a prediction about mortgage rates. Is he Monday morning quarterbacking on this? Say it’s not true Tim.

  18. 18
    gxar says:

    RE: ARDELL @ 14

    What does “North King is currently 81% healthy as a market for single family home vs condo.” mean?

  19. 19
    Hugh Dominic says:

    RE: gxar @ 18 – It’s BS. Ignore it.

  20. 20
    ARDELL says:

    RE: gxar @ 18

    Those are the YTD stats for % that are not short sale or REO vs the overall % of only 68% “healthy” for King County as a whole and 55% for Snohomish.

    http://www.realtown.com/Ardell/blog/tracking-the-market/seattle-home-prices-2011-fair-market-value/

    I actually pulled NW King, which is North of I-90 to the end of King County, but also West of Lake Sammamish. If you pull up all sales and call that 100% (single family home, not condos, houseboats, mobile homes or townhomes) and subtract the short sales and bank owned property, that gives you the % of non-distressed sales.

    The median price for each category is also shown. Quite a variance. Not sure why Hugh would call it BS…it’s just stats, not rhetoric. It’s a lot easier to find a bargain in an area that has only 55% regular priced properties than in an area that has 81%.

    The % that are REO properties seems to vary a lot more than the % that are short sales. Not sure why that is.

  21. 21
    2kt says:

    RE: Bingo @ 13

    There’s no reason why 30-year mortgage can not be at 3.5%. Money is leaving the stock market and going into fixed income (and gold). Gary Shilling predicted super-low rates couple of years ago and looks like the old man nailed it.

  22. 22

    RE: ARDELL @ 14 – If some agents don’t spend any time at all pricing short sales 3-4 months out, how much time do you think they spend pricing them initially?

  23. 23
    David Losh says:

    RE: Kary L. Krismer @ 22

    Again Kary, the pricing of the short sale is irrelevant.

    Nothing happens until there is an offer. You never know what the lender will take so most offers are low. It helps if the buyer’s agent submits the rational for the offer by CMA. The buyer should also be ready, willing, and able to close. That’s the hammer the buyer has, they are ready to close.

    The seller needs to have a file open with the lender. it needs to contain the hardship letter, and financials. That includes the W-2s, or a Profit, and Loss statement. A seller has to prove a hardship to be elegible.

    Tim’s case is the best. The seller was ready with a complete package, Tim had a lender who could perform well, Rhonda Porter, and the price was fair.

    There is no money in short sales. If you think you are getting a screaming deal you should look at it closely. Lenders do make mistakes, but don’t count on that.

    A buyer should be very careful, there are risks.

  24. 24

    RE: David Losh @ 23 – David, why are you talking about things about which you have no recent experience, if any experience at all? Quit pretending that you know things that you don’t.

  25. 25
    Macro Investor says:

    30 year rates CAN go to 1%, or even 0%. It is not because of what investors are doing. It is because BANKS ARE DESPERATE to get rid of their underwater paper and underwater REO’s. The fed and banks are manipulating the money markets. It’s survival for them. This CAN go on for decades, theoretically.

    But is it a sound investment for us? Eventually rates will normalize much higher. We don’t know when. But we do know that will be another hit to prices.

    If the payments on a house are lower than a rental, that’s half the battle. It’s not a sound investment if prices are still going down. You don’t want to save a few bucks a month on rent, only to lose thousands on the valuation… and be stuck forever unable to sell and move.

    A sound investment requires BOTH stable prices and cost comparable to cash flow.

  26. 26
    ARDELL says:

    RE: Kary L. Krismer @ 22

    Let’s chalk our differences up to we work in different markets, shall we? This post is about interest rates…so we don’t want to veer too far off topic.

    I only brought the topic up in response to Urban Artist comment #12: “We are looking but the inventory is either really bad or still overpriced or both… in the North King County areas.” which was in response to Tim’s comment.

    In the market I work in, as Urban Artist pointed out, there is more problem with over priced homes than under priced homes. Your market may vary. You may walk through a sea of under priced homes warranting that someone be fined $20,000 for that transgression. My clients don’t have that “problem”…we face the realities of Urban Artist in comment #12 of this post. We are waiting for the similar complaint against over priced homes…that you have for under priced ones. :)

  27. 27

    RE: ARDELL @ 26 – I wasn’t disputing what you said, only offering an explanation for poorly priced homes.

  28. 28
    ARDELL says:

    RE: Kary L. Krismer @ 27

    Let’s make this “our song”, Kary: http://bit.ly/W8P9g “so let’s leave it alone…cause we can’t see eye to eye. There ain’t no good guy…there ain’t no bad guy. There’s only you and me…and we just disagree”.

    :)

  29. 29

    RE: ARDELL @ 28 – Wow, it’s impossible to not disagree with you. No wonder we get into so many arguments. Even when I say something in agreement, you jump all over it.

  30. 30
    ARDELL says:

    RE: Kary L. Krismer @ 29

    You are still saying an agent “prices a home via CMA” after it is on market…no…I don’t know agents who do that…not good ones anyway. A CMA is NOT how you change price AFTER you are ON market. I will not agree with that as the normal way a successful agent gets from LISTED to SOLD. Not in 21 years have I even had anyone suggest that is the way to get a home from LISTED to SOLD.

    Go back to being a lawyer…at least a portion of what you say makes sense when you are not dictating to real estate agents who have helped people buy and sell homes for WAY long then you have. Be a lawyer, Kary…get the hell out from under that real estate agent hat. It doesn’t fit you.

  31. 31
    The Tim says:

    By Pegasus @ 17:

    By Feedback @ 15:

    Congratulations to Tim for defeating the Seattle Times!

    I don’t recall the Tim making a prediction about mortgage rates. Is he Monday morning quarterbacking on this? Say it’s not true Tim.

    I gave up making predictions about where mortgage rates would go sometime in 2009 when it became apparent that despite the common belief that “rates can’t go any lower,” and that they were about to rise any day, rates could in fact go lower, and would probably stay there for quite some time.

    You can read what I said about this article when it was posted, I linked to my April 2010 post right in the body of this post. Mostly I was mocking the sense of panic they were trying to induce, pointing out the same thing I did in this post: that even rates a couple points higher than where they are today would still be quite low.

  32. 32
    David Losh says:

    RE: Kary L. Krismer @ 24

    Again Kary, were playing with the NWMLS web site? Were you stalking me in your own way? You figured out that I hang my license at Skyline properties, which is the best deal any agent can get.

    For a very low desk fee at Skyline Properties Ron and Pete provide the absolute best in agent support. You can always find some one knowledable about Real Estate who will help direct new agents. The paper work is handled by the very most experienced office management you will find anywhere.

  33. 33

    RE: David Losh @ 32 – I also did some other things–remember real estate is all very public. But I realize I cannot check everything, such as perhaps an LLC you might be involved with, so that is why I asked you to state your experience prior to concluding you had zero experience.

    Remember, you were the one claiming you knew more about it than me. That caused me to check to see because you said things like:

    Post 102:

    It’s just an opinion, but what I know is this exchange has demonstrated that Kary has a view point far removed the actual Short Sale process,. …

    Post 142, responding to Ira:

    That’s not how short sales work.

    After checking a few different sources and found nothing to indicate that you had any recent experience (w/i two years) with short sales at all. And you’ve yet to indicate otherwise. But despite that you were claiming that what I was saying was “far removed” from a process you have no recent experience with.

    Do you really think you can say things on a public website, misleading the public, and not have those things called out? Why should anyone be silent when you are making false claims?

  34. 34

    By ARDELL @ 30:

    RE: Kary L. Krismer @ 29

    You are still saying an agent “prices a home via CMA” after it is on market…no…I don’t know agents who do that…not good ones anyway.

    Give it a break Ardell. AS I EXPLAINED IN THE OTHER THREAD, the term I used was CMA data. I wasn’t suggesting a formal CMA, but instead just looking at current listing data. I explained that before. Why are you bringing up the same ignorant question again?

    BTW, I seriously doubt you know what good agents do, or that you even know any good agents. People tend to sink to their own level.

  35. 35

    By ARDELL @ 30:

    You are still saying an agent “prices a home via CMA” after it is on markGo back to being a lawyer…at least a portion of what you say makes sense when you are not dictating to real estate agents who have helped people buy and sell homes for WAY long then you have. Be a lawyer, Kary…get the hell out from under that real estate agent hat. It doesn’t fit you.

    You should go back to being a stock broker, because you don’t know what you’re doing as an agent. Someone with your fantastic ability to predict the future, it would be a perfect match being in stocks! I wonder why you left that field? Must have been very lucrative with your ability to predict the future. /sarcasm

    And by the way, as to your prior insult about my attorney skills, the difference between you and me is you have no way of judging my skills as an attorney, but I have the ability to judge your skills as an agent, and they are very poor. You really should try another field. One that doesn’t have any rules or involve any laws.

  36. 36
    David Losh says:

    RE: Kary L. Krismer @ 35

    Now try to focus Kary, because Ardell has been extremely forth coming with actual Real Estate information.

    Look over here, it’s a shiney object.

  37. 37
    David Losh says:

    RE: Kary L. Krismer @ 33

    Uh, Oh, were you checking sources? Kind a creepy.

  38. 38

    RE: David Losh @ 37 – Uh, Oh, you were lying. Rather obviously so, which is why I checked. Beyond creepy. Pathetic that you resort to lying and making up a personal history about yourself that doesn’t exist.

  39. 39
    Bingo says:

    RE: 2kt @ 21

    You’ll get no argument from me on that. Unfortunately, if US Treasury rates continue to drop it will be because of further deterioration in Euro denominated securities and/or a further weakening of the US economy. Neither of which will be good for the housing market.

    Actually, I was trying (unsuccessfully) to egg on a discussion about whether lower mortgage rates might be an impetus to an improved housing market.

    Unfortunately, the thread has once again deteriorated into the schoolyard arena with , “am so”…”are not”…”are too”…”I double dog dare you”…blah, blah, blah.

    Maybe next time.

  40. 40
    ARDELL says:

    RE: Kary L. Krismer @ 35

    Not to engage in any more of this nonsense, but I must correct erroneous information. I have never been a stockbroker.

  41. 41

    By Kary L. Krismer @ 38:

    RE: David Losh @ 37 – Uh, Oh, you were lying. Rather obviously so, which is why I checked. Beyond creepy. Pathetic that you resort to lying and making up a personal history about yourself that doesn’t exist.

    I realized this wasn’t 100% accurate. I first checked because most the push back I get on this issue is from agents who use this illegal pricing method, or clock hour instructors who teach it. I knew you weren’t a clock hour instructor, but I didn’t know you went using the method. That’s when I discovered your short sale experience wasn’t exactly as claimed, but put it mildly.

    So I’m sorry for calling you an obvious liar. I should have left off the word obvious, because I didn’t know until I checked your record.

  42. 42

    RE: ARDELL @ 40 – Whatever, I know you had a prior life before being an agent. I would suggest you go back to that because there might be a possibility that you could actually be good at that.

    But why is it nonsense? You think you can insult my abilities but I can’t insult yours? You think you can suggest I find another profession, but I can’t suggest you do the same? I’m sorry, but someone with so little regard for following rules should not be a real estate agent, IMHO. And someone who is so bad at understanding what is sometimes very simple contract language, they should not be a real estate agent, IMHO.

  43. 43

    By David Losh @ 36:

    Now try to focus Kary, because Ardell has been extremely forth coming with actual Real Estate information.

    David, you don’t have the ability to assess that, and I will note that she has not disclosed her experience with short sales during the past two years. I don’t really call that extremely forthcoming when her entire argument (as was yours) is based on my somehow not understanding “the process.”

  44. 44
    ARDELL says:

    WOW! Forget about low interest rates…no more PMI? Holy Caboli! Rhonda just put up this post on it.

    http://raincityguide.com/2011/08/20/pmi-mortgage-insurance-company-are-no-longer-writing-new-polices/

  45. 45
  46. 46
    David Losh says:

    RE: Kary L. Krismer @ 41

    You also missed the part where I sent my license back to Olympia.

    In the office I worked the broker thought short sales were the way to generate commissions. Like I said I could be sitting at my desk today with two hundred short sale files, because I was the guy in the office who knows how to do them. I’ve done a lot.

    Another NWMLS rule is about agents blogging. I followed Tim’s advice for a while because it made sense, at the time, that without a license I could blog about the experience of under water property without recrimination.

    Let me say again, there is no money in short sales. In my opinion it is a gift to the seller, and the bank, if a buyer chooses to go through the process; go ahead and make something out of that.

    When lenders began adding addendums to the Purchase, and Sale I have always recommended an attorney. I like John Wagner at John Wagner Escrow. I would now recommend Craig after meeting him. This week I met Scott Weitz, and I will be recommending him also.

    You are so right, you have no way of knowing what I do. My goal is to help as many people as possible get rid of debt, or bad Real Estate investments.

    I have the right to refer, Kary. I can refer to any one, at any time, either for, or without a commission.

    If you read my stuff you will see I don’t think Real Estate agents make enough money. Let me amend that to say good Real Estate agents.

  47. 47
    David Losh says:

    By David Losh @ 23:

    RE: Kary L. Krismer @ 22

    Again Kary, the pricing of the short sale is irrelevant.

    Nothing happens until there is an offer. You never know what the lender will take so most offers are low. It helps if the buyer’s agent submits the rational for the offer by CMA. The buyer should also be ready, willing, and able to close. That’s the hammer the buyer has, they are ready to close.

    The seller needs to have a file open with the lender. it needs to contain the hardship letter, and financials. That includes the W-2s, or a Profit, and Loss statement. A seller has to prove a hardship to be elegible.

    Tim’s case is the best. The seller was ready with a complete package, Tim had a lender who could perform well, Rhonda Porter, and the price was fair.

    There is no money in short sales. If you think you are getting a screaming deal you should look at it closely. Lenders do make mistakes, but don’t count on that.

    A buyer should be very careful, there are risks.

    Now I took time out of my shedule today to post this. I had to post it twice because the spell check alters the way the comment feature works, and I deleted my first, more detailed comment, by hitting the back space button.

    You had all day to craft an opinion about how you think the short sale process works. Instead your choice was to comment on your research about me.

  48. 48
    ARDELL says:

    RE: David Losh @ 47

    LOL! I walked him…step by step…through the entire short sale process, more than once…and now he forgets I worked in a bank for 20 years and is calling me a stock broker. hahaha When did we have that ad nauseum discussion? Last week? Give up David. He either has selective memory or he’s lost his short term memory. Either way…stop wasting your time. He wants to cut my 41 years experience down to 2 years for some odd reason. If he can make me 39 years younger at the same time…it would be worth it.

    I appreciate that you remember that I told him…and told him…as I think he just asks again to make me go through it again. :) He probably laughs himself sick when I answer it again. :) It’s not about 2 years…it’s about 41 years. And I’ll be damned if I’m going to go through explaining short sales to him again.

    The short sale process, from the lienholder side, has not changed one iota in all these years. There’s no difference from one I did in 1992 to one I did in 2007 to one I’m doing right now. It’s all about closing it…and often that takes months. Kary doesn’t want to spend months working on something that may have no payday. That’s OK. I do it…until its done…without regard to how long or how much they may or may not pay me at the end.

  49. 49

    By ARDELL @ 44:

    WOW! Forget about low interest rates…no more PMI? Holy Caboli! Rhonda just put up this post on it.

    http://raincityguide.com/2011/08/20/pmi-mortgage-insurance-company-are-no-longer-writing-new-polices/

    If you read the piece by Rhonda, or understood the industry, or understood what you read, you would know there is more than one PMI company. BTW, they threatened this pull out a week or two ago. If you followed the industry you would have known that.

    From Rhonda’s piece:

    If you are currently in a transaction that involves private mortgage insurance, you may want to contact your mortgage originator to find out which company it is. If it is PMI Mortgage Insurance Company and your closing date is after September 19, 2011; find out what your mortgage originators plan is; you may also need to verify if you still have loan approval.

  50. 50

    By ARDELL @ 48:

    LOL! I walked him…step by step…through the entire short sale process, more than once…and now he forgets I worked in a bank for 20 years and is calling me a stock broker. hahaha When did we have that ad nauseum discussion? Last week? Give up David. He either has selective memory or he’s lost his short term memory.

    The short sale process, from the lienholder side, has not changed one iota in all these years. .

    First, what I am asking for is you to disclose your short sale experience in the past two years. I’ve never asked you to repeat your claims about what the process is. Yet more bad reading comprehension by Ardell? No wonder you can’t understand contracts (and now even blog pieces are beyond your comprehension).

    Second, there are two reasons I’m asking for a two year period, and you know about at least one of them. The first is that’s about how long the NWMLS has had a field for it. I’m not about do dig into earlier transactions. Second, you’re willing to make an assumption I’m not willing to make–that the short sale process has not changed at all in the past two years. Banks are often stupid in the way they deal with things, but they are not totally static. I don’t even assume things are done the same way in bankruptcy as when I was practicing. Things change.

    So once again, how many short sale transactions have you done in the past two years. And since David claims you have already answered that, please have your answer be in the form of a link to a thread here which pre-dates this post, and gives the post number.

  51. 51
    Ron says:

    You think Kary
    That the way your handling this on a Public Blog is a good idea?
    This kind of arguing when things are in permanent ink is not exactly
    doing great things for your profession…
    Putting your face up here with your full name is risky when your getting
    into shouting matches over the computer…. now if you were someone
    like a fast food worker it probably wouldn’t matter.
    I think your both are over the top- however Kary your kind of going extreme..

  52. 52

    RE: Ron @ 51 – I’d rather have it known that I am capable of standing up to an Internet bully than having insults about my knowledge and abilities go unanswered. Also, it doesn’t hurt letting consumers know that Ardell doesn’t know what she’s talking about. Seriously, the woman thought she needed to spy on her own clients. Would you want someone like that as your agent?

  53. 53
    Gerald says:

    RE: Ron @ 51 – This is one of those stretches where you either scan past all of the posturing or get out the popcorn. These clowns all think they’re “winning”, just like Charlie Sheen.

  54. 54
    David Losh says:

    RE: Kary L. Krismer @ 52

    You are the internet bully.

    Some time about a month ago you lost it. You just started attacking.

    What I said is I don’t mind being the lightning rod here. You can attack me all you want.

  55. 55
    ARDELL says:

    Kary: “Seriously, the woman thought she needed to spy on her own clients. Would you want someone like that as your agent?”

    I think I need to know…and do know…if the seller moved out of the house on the day of closing. I need to know that whether I represent the buyer of that house or the seller of that house, regardless of whether it is a short sale or not.

    How is that “spying” on people? How can an agent hand the keys to the new owner…not knowing if the former owner ever moved out? I also examine the property after the seller moves out to make sure they didn’t damage something on the way out or take something they shouldn’t have, like the stove.

    I can’t imagine an instance where the agent wouldn’t know whether or not a seller has moved out by the time the buyer is given the keys to their new home. You call that “spying”. I call that doing the job I was hired to do.

  56. 56

    RE: David Losh @ 54 – Go back and read the prior week’s twitter thread, post 34. Ardell calls me stupid, apparently for thinking the DOL and NWMLS know what they’re doing in this area.

    Or look at this thread. I try to agree with her, and she jumps all over me. Then she posts this (after falsely stating an argument that she claims I made before):

    Go back to being a lawyer…at least a portion of what you say makes sense when you are not dictating to real estate agents who have helped people buy and sell homes for WAY long then you have. Be a lawyer, Kary…get the hell out from under that real estate agent hat. It doesn’t fit you.

    I’m sorry, I’ve obviously committed a serious offense. I’ve suggested that agents not be involved with a pricing scheme that has resulted in 10 year suspensions and possibly $10,000 fines. Again, you and Ardell are free to do that if you wish. I’m not trying to dictate what you do (contrary to Ardell’s claims). I’m trying to warn you of what can happen if you do those things.

  57. 57
    ARDELL says:

    RE: Kary L. Krismer @ 56

    Kary…from the minute you were woohooing about someone getting a $20,000 fine for UNDER pricing a listing, I have asked where the outcry is for OVER priced listings, that is equal to the penalty for UNDER pricing a listing. If “the crime” is incorrectly pricing listings…why only on UNDER pricing?

    Home buyers are falling prey to OVER priced ones a whole lot more than UNDER priced ones. The Country is in crisis for having bought homes at too HIGH of a price, not too LOW of a price. If the goal is “consumer protection”, I would think overpricing would take the priority vs seemingly UNDER pricing getting the agent a $20,000 fine.

    You then ask me about the pricing process of a home that is 3 to 4 months on market. I scratch my head and don’t answer because by definition…a home on market for 3 to 4 months cannot BE “under” priced. At least by my definition…of course yours may vary.

    We simply don’t think the same way, Kary. That’s OK. As to “personal attacks”…my reaction to your attacks was not your attacking me, as I am used to your doing that at every opportunity. My animosity toward you was due to your calling Pegasus terrible names, like Peganutcase and stupid and a liar. I do not think anyone in our profession, lawyer or not, should attack a member of the general public in that manner on a blog he does not own.

    Call me crazy.

  58. 58

    By ARDELL @ 55:

    I can’t imagine an instance where the agent wouldn’t know whether or not a seller has moved out by the time the buyer is given the keys to their new home. You call that “spying”. I call that doing the job I was hired to do.

    It’s spying because you thought it was your responsibility to then go to the bank and inform them of your client’s behavior. That might not be a problem if they had done something illegal (I won’t take a position on that), but here they had not.

    What you still don’t understand the reason for the arms-length notice. As the facts were stated in the thread which lead to your blog piece, the bank most likely would not have had a problem with the seller staying in the house, because it didn’t affect the price paid for the house. The seller did want to move at the time the price was negotiated, and was asked multiple times if they wanted to stay before changing their mind. Thus, their staying probably wasn’t something the bank cared about, but in any case it also didn’t violate the terms of the arms-length notice, which was written in present tense. It didn’t even purport to cover subsequent agreements to stay.

    Finally, there are lots of times the agents may not know the property has been vacated. Keys are often left at the listing agent’s office and the buyer’s agent may meet their buyer some place other than the property, like perhaps where the buyer works. You would think someone with 20 years of real estate experience would know that.

  59. 59
    David Losh says:

    RE: Kary L. Krismer @ 56

    Kary, it’s not just Ardell, or me, or any one else. It’s the total package that you have presented. Sorry.

  60. 60

    By ARDELL @ 57:

    Kary…from the minute you were woohooing about someone getting a $20,000 fine for UNDER pricing a listing, I have asked where the outcry is for OVER priced listings, that is equal to the penalty for UNDER pricing a listing. If “the crime” is incorrectly pricing listings…why only on UNDER pricing?

    You think I have a short term memory problem? You already asked this and the answer was that a buyer can make an offer for the list price and be able to buy the property.

    As to Pegasus, the same rules work for him. He insults me, I’ll respond. It’s not that difficult to figure out. Note that my most recent response to him was thanking him for confirming my recollection of what “toad” said in a prior thread.

  61. 61

    By ARDELL @ 57:

    My animosity toward you was due to your calling Pegasus terrible names, like Peganutcase and stupid and a liar. I do not think anyone in our profession, lawyer or not, should attack a member of the general public in that manner on a blog he does not own.

    Call me crazy.

    First, you started attacking me long before I ever had any dealings with Pegasus. Second, did you own Rain City Guide at the times you were insulting me there? If you’re going to create rules, follow them.

  62. 62

    By ARDELL @ 57:

    You then ask me about the pricing process of a home that is 3 to 4 months on market. I scratch my head and don’t answer because by definition…a home on market for 3 to 4 months cannot BE “under” priced. At least by my definition…of course yours may vary.

    Where have I said that the price on a short sale could not be reduced if it’s been on the market for 3 to 4 months? I’ve been talking about price drops every 3 to 4 weeks, where those changes were arranged in at the time the listing went active. Short sales have limited buyers, so the fact that they don’t get an offer in 3 to 4 weeks doesn’t mean much. There was a normal sale locally where the price was reduced and it didn’t sell for 4 months, but it did sell. If they had followed a pattern of reducing the price by $20,000 every 3 to 4 weeks it probably would have sold faster–for less. That’s why normal sellers don’t typically do that.

    And before you respond, in discussing this in the past in my pieces I have mentioned the possibility of the owner and agent disagreeing on price, and agreeing to drop the price after X weeks if certain goals are not met (e.g. so many hits, showings, etc.). That is different.

  63. 63

    By ARDELL @ 57:

    Kary…from the minute you were woohooing about someone getting a $20,000 fine for UNDER pricing a listing, . . ..

    And again, you have a short term memory problem. As I have already explained, I know this agent, so I am not woohooing. But I am glad that the NWMLS is taking action to stop this abusive practice, assuming what he did is what I’m discussing (which I’ve said I cannot be certain about because I don’t know the property.)

  64. 64
    ARDELL says:

    RE: Kary L. Krismer @ 58

    Kary…you make things up as if they are true, and then argue your own point that you made up in the first place. Do you not see this about yourself?

    The Arms Length Agreement reads: “There is no agreement, whether oral, written or implied, between the Seller(s) and the Buyers and/or their respective agents that allows the seller(s) to remain in the property as tenants or to regain ownership of the property at any time after the consummation of the sale transaction.”

    Then you go around the internet…even in places where I am not present, and say Ardell doesn’t understand legal contracts. Kary…I understand plain English. What part of “that allows the Seller(s) to REMAIN in the property” is ambiguous?

    You can tell me I am wrong on that until the cows come home. If I sign an agreement saying there is NO agreement of any kind for the Seller(s) to remain in the property…I’m going to know if the seller ever left the property. I’m kinda funny that way.

    I call that ethics…you call that throwing my client under the bus. I think most people understand plain English, Kary. You may not be one of them. But most people do.

  65. 65
    ARDELL says:

    Here’s a new lesson for you, Kary. THIS is a post about INTEREST RATES!

    It is extremely rude to hijack EVERY post’s comment thread to beat your dead horses in.

    Learn that lesson. Please!

    You don’t even own a blog! Go start a WordPress blog called “Kary’s Dead Horses” and stop dragging all of your dead horses into every single freaking topic on the internet. The last time I saw someone doing this, they died shortly thereafter of a brain aneurysm. Actually I’ve seen that happen twice, and the big tip off of their malady was freaking out and going whacko in an off topic manner on the internet just prior to their death.

    With all due respect and sincere concern for your health, please go get your head examined.

  66. 66

    RE: Kary L. Krismer @ 49 – it is kind of confusing that the company name is PMI – there are other private mortgage insurance companies however you have to wonder what shape any of them are in.

  67. 67

    RE: The Tim @ 31 – it’s near impossible to predict mortgage rates any more… all the old typical indicators are no longer as reliable as they once were. We can have a nasty day in the stock markets and not see much impact with mortgage rates (if investors are pulling out or seeking gold or other investments besides bonds like mortgage backed securities). I really rely on watching how the 30 year and 10 yr are trading (I subscribe to a service), watch the DOW and keep informed of upcoming economic indicators – but it’s still not as reliable.

    I’m shocked how low mortgage rates are right now.

  68. 68

    By ARDELL @ 64:

    Kary…you make things up as if they are true, and then argue your own point that you made up in the first place. Do you not see this about yourself?

    The Arms Length Agreement reads: “There is no agreement, whether oral, written or implied, between the Seller(s) and the Buyers and/or their respective agents that allows the seller(s) to remain in the property as tenants or to regain ownership of the property at any time after the consummation of the sale transaction.”

    Present tense. Don’t you understand simple English? There was no agreement when it was signed. It doesn’t say “There is no agreement and will not be any agreement. . ..” And it clearly doesn’t say: There is no agreement, and will not be any agreement, and the real estate agents should spy on their clients to determine that there will never be such an agreement. Again what the bank cares about is that the consideration is only the purchase price, not the purchase price and some sweetheart deal to stay in the property cheaply.

    This is why real estate agents should not tell clients what contracts mean. They are not taught how to interpret language.

    BTW, I know it makes no difference to you, but the person who originally asked the question did ask an attorney, and they told him there was nothing to worry about. I asked two real estate attorneys. Same result.

  69. 69

    By Rhonda Porter @ 66:

    RE: Kary L. Krismer @ 49 – it is kind of confusing that the company name is PMI – there are other private mortgage insurance companies however you have to wonder what shape any of them are in.

    I wonder if they were late in the game to pulling back on condos, or maybe they had a special deal with some lender that proved to be a bad lender?

  70. 70

    By ARDELL @ 65:

    Here’s a new lesson for you, Kary. THIS is a post about INTEREST RATES!

    It is extremely rude to hijack EVERY post’s comment thread to beat your dead horses in.

    Learn that lesson. Please!

    ROTFLMAO. You really do have a memory problem. Go back to post 30 to see who started this. Before that I was trying to agree with you, but you wouldn’t even let me do that.

  71. 71

    By David Losh @ 54:

    RE: Kary L. Krismer @ 52

    You are the internet bully. .

    Right, check out Ardell’s latest. She really is pathetic.

    http://raincityguide.com/2011/08/21/ardell-dellaloggia-and-kary-krismer/

    But to answer Ardell’s question, the reason I call her out so often is because she is a really bad agent. One of the worst I’ve ever seen. How can an agent with 20 years experience not know that it takes both a buyer’s and seller’s signature to get an earnest money returned? How can an agent with 20 years experience think that signing a bank form requires her to spy on her clients, and authorizes the other agent to spy on her clients? And don’t even get me started on her predictions and repeatedly stating that she doesn’t care what a rule is, she isn’t going to follow it.

    Ardell, you say a lot of things that are just wrong, and then you insult me when I point that out. That’s why we don’t get along.

  72. 72
    ARDELL says:

    “One of the worst I’ve ever seen.”

    Perhaps you want to speak the larger truth there…you have never “seen” me. I have never met you. We have never worked on anything together. You simply hate me…and attack me…and have for years. It is fine for you to disagree with me on the issues, Kary. But why does that make you so angry? People have different views on many things…all the time. Why does this consume you so?

  73. 73
    ARDELL says:

    RE: Kary L. Krismer @ 68

    Kary…if the seller never moved out and remained as a tenant, all parties who signed the Arms Length Agreement are committing fraud. I don’t care how many people, attorneys, agents, agree with you. I just don’t. In fact someone from the Lender Fraud Investigation Task Force in CA contacted me when she saw you tell me I was wrong on this…and told me I was right. If the industry knew what was right…there wouldn’t be so many investigations going on of what has been done wrong.

    We have been having this same argument for at least 4 years going back to your disagreeing with my post on “lease purchase” vs “lease with an option to buy”. We do not agree on many things.

    Perhaps my being the worst agent you have ever (never) “seen” is a compliment.

    How do we end this, Kary? It really must end. How does this end? Can we not post differing opinions here…or on Trulia…or anywhere, without your taking it so personally?

  74. 74
    Kevin Troll says:

    I think Kary has a poop stuck sideways.

  75. 75
    Real World Express says:

    The other scare tactic that was used earlier this year was “increasing rents”.

    Now I’m reading a few articles about the “Rental Bubble”.

    I can see Seattle returning to the days of the $200 one-bedroom in-city small apartment.

  76. 76

    By ARDELL @ 72:

    But why does that make you so angry?

    What makes you think I’m angry? You ask a straightforward question, and I answer it.

    BTW, I don’t have to have ever met you to know you’re a bad agent. I know people who have worked with you. In addition, an agent who cannot adequately describe to a buyer client the risk of depositing earnest money is a bad agent. No ifs, ands or buts. That’s pretty basic. Maybe if you only represented sellers that wouldn’t be a big deal.

  77. 77

    By ARDELL @ 73:

    Kary…if the seller never moved out and remained as a tenant, all parties who signed the Arms Length Agreement are committing fraud. I don’t care how many people, attorneys, agents, agree with you.

    No it is not fraud. Perhaps if you did more short sales, and understood the English language better, you would understand that.

    As to the last sentence, that is part of the problem. You don’t care if the DOL, NWMLS, an ALJ, attorneys, or every other agent in a 100+ post thread not agree with you. You just assume you are right because that was the first thought that popped into your head. Only you could have approximately 100 agents in a thread disagree with you and then go write a blog piece that says “Am I right, or am I right?” That’s the only two scenarios you ever see.

  78. 78
    Wake Up says:

    For those keeping internet prediction scores, here’s the scope:
    It doesnt matter if you get a 4%, 3% or 1% fixed rate loan amortized over 15 or 30 years, you will still be losing money.

    What is happening, and continues to happen every day until the .gov and TBTF properly fail rather than be propped up:
    Year: 8/2011 to 1/2014
    Sq ft home: 2500
    Cost: $437,500
    Loan: $350,000
    Rate: 3.5%
    Years:30
    Total interest paid: $215,796.31
    Est. fees paid: $5000
    Total paid over 30 years: $570,796.31

    The years 2015 – 2016 where price will shift on the 2500 sq ft home
    Sq ft home: 2500
    Cost: $210,000
    Loan: $168,000
    Rate: 5.5%
    Years:30
    Total interest paid: $175,398.79
    Est. fees paid: $5000
    Total paid over 30 years: $348,398.79

    Difference for waiting another 3 years:
    $222,397.52

    Doesn’t matter if that rate drops down to 1%, it’s the price of the house that needs to reset back to supported levels. And having 15% of western Washington being supported by high tech jobs with everyone else lagging to barely making it in service and construction jobs, aint going to cut it.

    tl;dr
    prices will shift down across king county and snohomish county where on avg you will be able to pick up 2500 sq ft homes at 40-48% less than Q3 2011 sometime in the years 2015-2016.

  79. 79

    […] and real estate not bouncing back until at least mid-2011. The gold bubble has yet to pop, interest rates have yet to rise (though any deflationary spiral has been mild), and delayed foreclosures are still […]

  80. 80

    […] this sounds familiar it’s because we heard the same nonsense when rates moved from 5.0% to 5.3% in 2010. These types of articles often include a graphic like […]

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