The Seattle PI Terms of Service makes it very clear that they take copyright and trademark infringement seriously.
Please take care to put in all caps or, at the very least, capitalize the term "REALTOR®".
While all REALTORS® are either real estate sales agents or brokers, not all agents and brokers are REALTORS®.
The term "REALTOR®" refers to those agents and brokers who are members of the National Association of REALTORS® and who adhere to a strict code of ethics. (#113076])
...
I am totally serious. The Seattle PI takes copyright infringement and trademark violations very seriously. Please adhere to their rules or refrain from commenting here. Thanks. (#113155)
Wow, that's a pretty hard line on the Terms of Service, which states in part (section 6):
...you shall not upload, post, transmit, distribute or otherwise publish...any materials which are, do, or could reasonably be construed to...violate, plagiarize or infringe the rights of third parties including, without limitation, copyright, trademark...
Here's another interesting section of the TOS (section 7):
You warrant and agree that...you shall not: ...(b) insert your own or a third party's advertising, branding or other promotional content into any of the Web Site's content, materials or services
So when a writer on the blog openly admits that their recent post was indeed "a blatant advertisement" for a friend in the industry, it will surely be modified to remove such promotional content, so it conforms to the TOS, right?
Attributing items of interest to a source is not a violation of the terms of service. Because of the nature of our topic, we're apt to quote a lot of sources in our industry. I would not automatically assume that naming those sources would constitute a violation of the terms of service unless it appears that it was done merely to promote rather than inform and share. (#123045)
Eleua, as our area continues to grow, prices here may well continue to escalate beyond salaries. It's all about supply and demand.
She reminds me of a lady at church that was trying to convince us last year that it made so much more sense to buy than to rent. I didn't want to get into an argument so I just told her that my income wasn't high enough to buy. Her reply? "You don't need income to buy a house." (Not exact words but pretty much what she said). I was shocked and didn't really know how to reply to such ignorance.
The Tim, Synthetic and Eleua, you are all creating off topic discussions, and deliberately trying to create distubance.
You are not real estate agents, so please refrain from abusing the real estate agents and anyone else on this forum.
This was supposed to be a mellow discussion of choices, questions and answers for buyers or sellers, not a place for your snarkiness.
My goodness, don't you all have jobs to go do? The Tim, go write the Naked Loon, I think that's a great parody piece, and well worth spending energy on.
Translation: "The truth! It burns! Make it stop!"
Also, I tried to comment but got this error: "Error: Your IP address has been banned. You cannot submit a comment"
Seems like a more appropriate title for that list would have been: "Top 10 Reasons It's a Better Time To Buy Than 2005 (When Real Estate Agents Were All Telling Us It Was A Great Time To Buy But In Fact It Was The Worst Possible Time To Buy)"
I agree wholeheartedly: Now is a way better time to buy than 2005. However, that doesn't make it a "Great Time To Buy!™"
Report violation #122867Posted by Leanne Finlay at 4/28/08 8:36 p.m.
The Tim has written in right on schedule!
Next?
Report violation #122870Posted by Fripp at 4/28/08 8:40 p.m.
Did you honestly not expect a comment like The Tim's? Your loan officer friend's list is really just more of the "It's a great time to buy" junk that got everyone in the industry such a bad reputation in the first place.
Also, isn't this just a blatant advertisement for your friend?
Report violation #122872Posted by Leanne Finlay at 4/28/08 8:43 p.m.
Fripp, sure it is! Why not give Todd a plug :-)?
What this is really, is something that many buyers will find useful. Really.
Not everyone is as jaded like you and The Tim.
--The Leanne
Report violation #122873Posted by Fripp at 4/28/08 8:45 p.m.
I'm not all that jaded...really. I just don't understand how his list is any different than the top 10 lists of the last 3 years which all said it was a great time to buy.
By the way, I didn't even have time to hit the "return to forum" link before your reply was up. Quick trigger tonight!
Report violation #122876Posted by Leanne Finlay at 4/28/08 8:47 p.m.
Hi Fripp,
This list is much like the lists that existed in 1983 when I first started in real estate. Most of it isn't new at all, but it does give a lot of people a look at the reasons why today isn't as bad as some portray it as. Balance is always a good thing.
I just sat down to respond to The Tim, and there you were!
--Quick draw Leanne
Report violation #122880Posted by Fripp at 4/28/08 9:02 p.m.
I don't want to come off as snarky, but it seems like we just keep seeing top ten lists, with whatever current factors indicate now is a good time to buy. I don't often see a top ten list of reasons why it is a good time to wait 12 to 18 months before purchasing.
Oh, and since Marlow has been cracking down on the terms of service, Paragraph 7 prohibits posting your own or a third party's advertising, branding or other promotional content. (Ok, that was a little snarky, but it was more directed at the silly trademark debate that broke out a few weeks ago).
Report violation #122884Posted by Dugald Allen at 4/28/08 9:11 p.m.
Leanne's buddy wrote: 7. DUE DILIGENCE IS WELCOMED. Buyers are encouraged to obtain home inspections. In recent years, many buyers waived these contingencies in order to gain an advantage in multiple offer situations. A thorough inspection can save you thousands of dollars in repairs.
An offer without an inspection contingency doesn't have to mean that there wasn't an inspection. Inspectors can be scheduled to do an inspection prior to making an offer. You may be buying the house as-is, but at least you have a leg up on knowing what as-is ...well, is.
Report violation #122886Posted by czb at 4/28/08 9:17 p.m.
I don't know, Leanne - seems to me like this guy Tim's comments are pretty much on the money. It's a much better time to buy than during the heyday of bidding wars. Is it a better time to buy than next year or the year after? That question is very much open to debate, whether you like it or not. Openly dismissing very reasonable discussion points such as presented by your first poster simply because they don't serve your interests seems anathema to the whole concept of blogging.
Report violation #122888Posted by Leanne Finlay at 4/28/08 9:27 p.m.
Fripp, actually, since I was referencing Todd's list, it is ok to link him as the source.
But, there are many people who do want to buy now, for many reasons. Part of a real estate agents job is to advise, and I liked Todd's list, so I figured if I did, others would too. I believe this list is valid.
There are many buyers who have legitimate needs and reasons for buying today. They feel real fear, caused by the market, the media, and blogs like The Tim's. I feel that someone has to add some balance, and level off the one-sided nature of how the media is becoming.
For example, I just sold a clients home in Shoreline. They have a 3-yr old and a new baby. The 3-yr old is ready for trikes, and soon bikes, and their old house was not in a sidewalk or flat area. They bought a new home in an ultra-flat neighborhood, on a cul-de-sac, much more suitable for the needs they have as a young family.
Since they bought several years ago, selling now and buying now is reasonable. They didn't want to wait and have a 3-yr old become a disappointed 6 or 7-yr old.
Even if they were first time buyers, the decision to own rather than rent is an individual choice. Not eveyone wants to raise their kids in rental homes.
They are just one example. Oh, by the way, the house they sold, sold to a person returning to the NW after many years away. They chose not to be a renter too.
I think it's a sad time in our modern times that so many feel they are expert enough to comment on others choices so freely.
Report violation #122890Posted by Fripp at 4/28/08 9:33 p.m.
I wasn't commenting on anyone's personal choices Leanne....and I don't think The Tim was either. I was commenting on the list and how I can almost always count on seeing a Top 10 list of why it's a great time to buy. I never claimed to be an expert, and I most certainly didn't comment on someone else's choices.
And I still think the content of the post would qualify as "promotional content" for your friend. I don't see how giving him credit gets you around that. I'm sure he sent that list to many people hoping to get his name out there.
Report violation #122893Posted by Leanne Finlay at 4/28/08 9:43 p.m.
Dugald, true, true. How many times did we all have to have our buyers pay for inspections, make offers, and yet not get the house they bid on? It was crazy, and I'm glad those insane days are mostly gone. I say mostly since multiple offers do still occur, and pre-inspections often are the best way to win in a multi-situation.
Some think we just made money hand over fist in those days -- ha! I prefer a level playing field, which of course we don't quite have today either.
Czb, are you single? Do you have kids? Do you own? Renting isn't for everyone. The point is, I think you guys should let people make up their own minds, and quit bashing real estate agents. We are not the cause of the economic issues today.
Real estate agents didn't create the last few years. Perhaps lenders did, and perhaps there were other causes, or pehaps it was a combination of things. There are a lot of theories on "who" to blame, but since real estate agents didn't hand out loans, I think it's fair to say that the quarterbacks were not the real estate agents. Perhaps the agents were the cheerleaders as some of you suggest. Were the lenders the coaches? Well, sports analogies aren't real estate either.
I agree that many real estate agents acted intensely dumb, by suggesting that 'prices never go down', but since they were inexperienced, and being led by lenders handing out "free" money, can you really blame their ignorance? I don't know any seasoned, experienced agents who made those statements.
None of us have a crystal ball that works. What we do have is insight, experience and advice for those who are interested in our points of view.
And, the stats out there are definitely showing that people are buying and people are selling, and using real estate agents.
Report violation #122897Posted by Leanne Finlay at 4/28/08 9:53 p.m.
Fripp, there are many links that could be construed as promotional. I just linked to him because he was the source.
When blogs simply become confrontational, they are not interesting or useful.
This blog has a lot of professionals, not just agents, who buyers and sellers should feel free to ask questions of. But, when we see a lot of people writing unnecessary things, most people just quit reading, and certainly won't ask questions if they feel at risk of being put down, or made fun of.
I'd like to see this become more of an open Q & A and advisory board, with a variety of things being discussed. When we talk to someone who really wants to buy or sell, I don't think it is fair to them to have the majority of non-agent speakers tell them "it's simply a horrible time to do any business".
Report violation #122904Posted by laxtosnoco at 4/28/08 10:22 p.m.
Of course it's a good time to buy. I just heard a NAR add proclaiming that house prices double every 10 years. How can I lose?
Report violation #122909Posted by synthetik at 4/28/08 10:35 p.m.
Hellarious. You're going to need a lot of Kool-Aid to wash down all that Top Ramen.
It appears that you won't have any issues.
Report violation #122913Posted by Eleua at 4/28/08 10:48 p.m.
You RE perma-bulls crack me up.
For years, you sold houses as fail-safe investments, and now that people are fully indoctrinated to view houses as investments, they are selling.
Now that prices are going down, people don't want anything to do with houses
Here is an idea. Start selling houses as places to live and not expect any capital gain on a basic living expense.
If you condition people to treat homes as they would a stock, then don't be surprised if they do.
Your chickens are knocking on the door and they want to roost.
Report violation #122914Posted by Debra Sinick at 4/28/08 10:48 p.m.
Lax,
There are no guarantees with anything. However, it is true that housing has doubled and, in our area, more than doubled over the last ten years.
People who are buying now should plan to stay at least 5-7 years in a home. There's no more quick bucks to be made in the housing market.
It's worth taking the risk to buy if it is right for you. Buying or selling is a very individual thing. If you don't have to buy and don't want to, then don't. If you think this might be a good time, then maybe you should check things out and see what your options are. If you are waiting for things to bottom out, I wish you the best. Do let me know when you've found "bottom", because the only way you'll know you've reached the bottom is when things are already on their way back up.
Report violation #122918Posted by Eleua at 4/28/08 10:57 p.m.
In a few years, when prices are 20% of what they were in the summer of 2007, and renting is a premium to PITI, then it is time to buy.
I can still rent for half of PITI.
Report violation #122922Posted by synthetik at 4/28/08 11:06 p.m.
You'll know when we've hit bottom when the realtor to fence post ratio is no longer 10 to 1.
When all the housing porn TV shows are gone.
When all the realtor blogs are gone.
When the public realizes renters have more cash and brains than homedebtors.
When all the fraud is removed from the system.
When you can buy for about the same price as renting.
When properties can cash flow again.
We're a very long, long way from a bottom. Shame on you, your blog, and your horrible shilly newspaper.
Report violation #122923Posted by Eleua at 4/28/08 11:13 p.m.
Rough calculations:
Neighbor's house is a rental and he asks $1900, and gets around $1750. It is occupied about 85% of the time. Taxes run around $3K/yr. Assuming he can get away with only $1500/yr for maintenance and has no property management fees, here is how I would value the house.
Gross rev: $1700 x 12 x .85 = $17340
after maint and taxes: $12840
I can get 7% in a fairly benign, safe money fund that costs me nothing in effort, so the ROI has to be greater than that amount. Interest rates are at historic lows, thus are primed to rise, so I need somewhere in the 10% ROI range.
Housing is also risky. Kitsap vacancy rates are on the rise, and rents are dropping. I need more ROI to compensate for that risk.
Running the numbers at 10% ROI yields a house cost of $128,400. At 12%, we get $107,000.
That's assuming I pay cash and have no monthly payment to the bank.
With a monthly payment, I would still need it to cashflow, and that would be tough.
He rejected an offer of $400K with no counter. As you can see, prices have a long way to fall before any real value is reached.
We will get there. We will get there sooner than you think. It is already starting.
Report violation #122928Posted by Eleua at 4/28/08 11:32 p.m.
Oops. I ran $1700 rather than $1750 per month through the calculation. Either way an extra $7K in value isn't enough to close the gap between peak-bubble expectations and investment grade real value.
The 28% PITI/income ratio works for this area. A house like this would command slightly more than normal household income, but if you ran the numbers at 8 or 9% interest rates (we will be there by the end of the year), then the numbers work well. I also suspect that the back-end debt ratio will be the capper on this, as most households are drowning in all forms of debt, not just mortgage debt.
Face it. It was a bubble and bubbles pop. This one will put housing in the tank for many, many years.
When total strangers approach you and tell you that you are a certified moron for buying a house (just as they did for renters back in 2006) then that will be a good sign that the bottom is at hand.
Report violation #122929Posted by czb at 4/28/08 11:39 p.m.
Leanne,
Re your prior comment: "Czb, are you single? Do you have kids? Do you own? Renting isn't for everyone. The point is, I think you guys should let people make up their own minds, and quit bashing real estate agents. We are not the cause of the economic issues today."
1. Please review my post and let me know at what point it resembled anything remotely close to "bashing real estate agents." The only thing I can be accused of is criticizing you for being dismissive about a dissenting viewpoint on a blog that presumes to be a sounding board for such discussions.
2. I do not think RE agents are the cause of today's economic issues. Lax lending policies and bizarre central bank priorities caused this mess. RE agents are/will be victims of these policies, like many others.
3. Although it's really none of your business and I realize that anyone who doesn't believe in the indefinite appreciation of real estate is supposed to be single and practically a teenager, I am married with 2 daughters under age 5, have lots of gray hair and have owned a house since 1999, when I thought it still made sense to buy a house. I wouldn't consider buying real estate in the current environment regardless of what I can 'afford'. The supposed 'hardship' endured by my children in having to live in rental properties would be paid off to them in droves by the fat college tuition accounts or maybe even trust funds that would result from my not sinking large sums of money into a depreciating asset while having monthly costs equivalent to 50% of a mortgage. (Until they eventually marry some loser who will squander it all and I will wish I had bought a huge overpriced McMansion with lots of big screen TVs instead, but I digress) I do not claim to be an expert. That is simply my own opinion as a potential real estate consumer.
Report violation #122934Posted by Leanne Finlay at 4/29/08 12:25 a.m.
Czb, I really wasn't directing specifically at you. Your posts really are very reasonable, and I don't see a real issue with anything you have to say.
However, we've got a few ranters here that are disruptive, and add nothing except disruption for disruptions sake. This isn't that type of blog.
Thank you for saying you agree with me in #2 too. I appreciate it. Dissention is ok, but the resistance to the dissention is when it is purely done to disrupt and belittle and cause damage to the thread.
When I say people should own, and want to own, I don't necessarily mean for investment of 'winning a big reward'. Homes are where you live, and if you pay it off over 30 years, and don't make a dime, you've still got your home, your memories and all the stuff that others might well call crap. I wouldn't call any of that crap.
I also don't believe we'll see a long period where appreciation doesn't kick back in, but I've never been one suggest homes go up-up-up without end, so I won't start that now either.
Czb, by the time your girls are old enough to marry, they will find that your wise ways have made them desireable assests to some cute, but broke young boys :-)! Ha ha, I'm kidding ...
And, I just don't agree that we're going to see rents be 50% of mortgages. An investment in real estate is part of the American Dream, don't knock it.
Report violation #122935Posted by Leanne Finlay at 4/29/08 12:34 a.m.
Oh yeah, for those who forgot, landlords get to depreciate their rentals, and take expenses such as a new roof as capital improvement deductions on their taxes. Run a little calculation thru Turbo Tax to see how those tax benefits work.
Report violation #122946Posted by Mack McCoy at 4/29/08 2:59 a.m.
Dugald, of course, is correct. Very few homebuyers buy without inspections.
As for whether it's a good time to buy or not: snarks, really, does anybody care what you say or think? The Tim, at least, is on record as having given a great deal of thought to the matter. But when my pal synthetik resorts to comparing the idea to the deaths of nine hundred people in a mass murder/suicide, I think that your find yourselves in company that is not beneficial to your interests, whatever they may be.
Then, again, maybe you'll tell us the next time you come by - why you care so much. Is it really your goal to discourage people from buying real estate?
Report violation #122955Posted by Mack McCoy at 4/29/08 3:58 a.m.
So, with Dugald's astute amplification, what about the list isn't true? I am hearing of more investors coming into the market, but don't know if that's widespread. Anyone?
Report violation #122977Posted by Kary L. Krismer at 4/29/08 6:46 a.m.
The Tim wrote: "I agree wholeheartedly: Now is a way better time to buy than 2005. However, that doesn't make it a "Great Time To Buy!™"
Interesting comment since the King County median is now $440k, compared to $393k at the end of 2005, and $355k in March 2005. Median now $539k, vs. 449k Dec, 05, and 436k March, 05.
Personally I don't like county-wide medians much, and I also don't like making buying decisions on where the market is supposedly heading. Family situations drive more sales than predictions of where the market is headed, except during periods of what I refer to as "panic buying." But other than relative price, I can't really say that today is better or worse than 2005.
Report violation #122978Posted by Kary L. Krismer at 4/29/08 6:48 a.m.
Dugald wrote: "An offer without an inspection contingency doesn't have to mean that there wasn't an inspection. Inspectors can be scheduled to do an inspection prior to making an offer. You may be buying the house as-is, but at least you have a leg up on knowing what as-is ...well, is."
Or you could have an inspection after, and just leave your earnest money on the table. On older houses the lender may require an inspection, which is where you'd be (leaving earnest money behind) if something serious was discovered and the seller wouldn't fix it.
Report violation #122980Posted by Amused at 4/29/08 6:49 a.m.
"Do let me know when you've found "bottom", because the only way you'll know you've reached the bottom is when things are already on their way back up."
As some other posters have alluded to, you know that you will have hit bottom when the average person thinks that real estate is a perfectly stupid investment. Because of that, the pattern in past real estate declines is that RE prices scrape along the bottom for quite awhile - it takes time for people to forget the losses incurred in the decline and start pricing expected appreciation back into house values. So, when things have bottomed out, you will have plenty of time to buy - it's not that housing values are immediately going to start shooting up at 20%/year again after the bottom is reached.
Report violation #122983Posted by Kary L. Krismer at 4/29/08 6:50 a.m.
Leanne wrote: "None of us have a crystal ball that works. "
Don't say that, or tell that to Ardell! We just went over 300 posts in two threads debating that one at Rain City.
Report violation #122984Posted by Kary L. Krismer at 4/29/08 6:54 a.m.
Lax wrote: "Of course it's a good time to buy. I just heard a NAR add proclaiming that house prices double every 10 years."
Per the rule of 72, that's basically a 7% increase per year. When you consider that nominal dollars (not adjusted for inflation) it's not that impressive. What helps many people, however, is that it does compound.
Report violation #122988Posted by Kary L. Krismer at 4/29/08 6:58 a.m.
Eleua wrote: "Here is an idea. Start selling houses as places to live and not expect any capital gain on a basic living expense."
I'm two years ahead of you (which goes back to when I started), and agree fully.
But in fairness to the agents, I think clients come with those expectations. It's like how a client will sometimes want to pay more for the house than an agent thinks is prudent, except for the bullishness is probably much more common than wanting to pay too much. The point is, the agents don't indoctrinate the clients--they actually have their own thoughts and beliefs prior to meeting agents. Imagine that. ;-)
Report violation #122991Posted by Debra Sinick at 4/29/08 7:02 a.m.
Amused,
I agree with you: "it's not that housing values are immediately going to start shooting up at 20%/year again after the bottom is reached."
It is going to be a long, long time before we see housing shoot up the way we have in the past. However, at some point, what is happening now will change, and change for the better. It may be slow, it may not be for too much appreciation, but it will change. We have come to expect way too much in appreciation. Those days of the 20-25% may not be around for a very long time.
CZB,
Thanks, you are right. Real estate agents have not created all of this.
Report violation #122992Posted by Kary L. Krismer at 4/29/08 7:04 a.m.
"When all the housing porn TV shows are gone."
Damn, I'm going to have to let the wife get HGTV again! ;-)
I like the This Old House type of show, because it shows you how to do things. The worst HGTV type of show is the one where the agent comes in, looks at what the owner has, and pronounces a price opinion. If they followed that up with a listing and sale, that might mean something. Otherwise it's just a waste of disc space on your Tivo.
Report violation #122995Posted by Kary L. Krismer at 4/29/08 7:10 a.m.
One last point (to the things posted while I slept and did other things). I don't see where the bidding war is a thing of the past. It happens on the nicer houses (as our friend biliruben recently discovered), and even still on the lesser houses priced at a bargain (although that is much less frequent and often fails today). Roughly 33% of the houses go STI or pending within the first 30 days. The market for the nicer houses really hasn't changed that much.
Report violation #122997Posted by Eleua at 4/29/08 7:34 a.m.
The idea that real estate can appreciate 7%/yr without end is a perfectly stupid idea.
If incomes only go up 2-3%, how can RE go up 7%? It is only a matter of a few years before every dollar you make is consumed by PITI. After that, PITI consumes more than you make.
Cheap, reckless credit created this mess over the past two decades and we are on the brink of having to pay that back.
I also find it amazing that in 2008 you can't find a Realtor that will admit to pimping houses as great, can't-lose investments, even though in 2006, you couldn't find one that wasn't. How do you think Realtors got that reputation?
The proof is when the NAR runs a line of Bravo-Sierra like 7% perpetual appreciation, none of its members even bother to question them on it.
BTW, home debtorship is NOT the American Dream. The American Dream is having a sustainable standard of living that is above the sustainable standard of living your parents and grandparents experienced. Excessive debt is absolutely ruinous to that goal.
Debt is the antithesis of wealth. Never forget that.
Report violation #122999Posted by Kary L. Krismer at 4/29/08 7:43 a.m.
Eleua wrote: "I also find it amazing that in 2008 you can't find a Realtor that will admit to pimping houses as great, can't-lose investments, even though in 2006, you couldn't find one that wasn't. How do you think Realtors got that reputation?"
You're kidding right? You think you have a feel for that sort of thing? It would be impossible for you to have a feel for that.
I'd point out most bubble bloggers don't even know basic facts, like what type of financing is available at any given time. Bubble bloggers thought 100% financing was gone in 2007. Basically what you're basing the opinion I quoted on is the opinion of people who don't know what they're talking about, because as far as I know, there are no surveys of what real estate agents think at any given time. It would be a pretty pointless survey (because agents can't predict the future, so why ask what they think?).
Report violation #123001Posted by Kary L. Krismer at 4/29/08 7:50 a.m.
Eleua wrote: "The idea that real estate can appreciate 7%/yr without end is a perfectly stupid idea. If incomes only go up 2-3%, how can RE go up 7%? ...
Debt is the antithesis of wealth. Never forget that."
Eleua, I can only assume you're under 40 years old, and that you've never experienced significant inflation during your adult lifetime. As I mentioned in my prior post, the 7% figure doesn't account for inflation.
Let's just assume that the rise in oil prices has the same effect on our economy as in the mid-70s. I'm not saying it will, but let's assume it will. If that happened your best investment right now would probably be to buy as much real estate as you can with 100% financing. The worst investment you could have would be a bank account. During periods of inflation, non-cash assets and debt are good.
BTW, the comment that debt is the opposite of wealth would also indicate you don't have a business background. Going in debt to have a night on the town--bad. Going in debt to make money--good (depending on the results).
Report violation #123003Posted by Kary L. Krismer at 4/29/08 7:54 a.m.
Eleua wrote: "The proof is when the NAR runs a line of Bravo-Sierra like 7% perpetual appreciation, none of its members even bother to question them on it."
I think if you look at the official NAR line, it's something to the effect that on average real estate prices increase in excess of 6% a year and double every 10 years. I'm the one that said 7, because if they double every 10 years, it's just short of 7 (I'm rounding up).
And they say it because historically over some period of time, it's true. But past performance doesn't guarantee future results.
Report violation #123006Posted by buddhabrad at 4/29/08 7:58 a.m.
Bubble bloggers would know more about the market if those with access to the data would publish it, rather than stuff the bad news in the top drawer and write goofy factless, baseless posts like these.
I pine for the days when the data is flowing again, and when the market is such that realtors aren't up at 2am/3am/4am yapping away at their customers, but instead are getting a good night's sleep after a long day of showing houses.
/home depot is hiring
Report violation #123010Posted by Kary L. Krismer at 4/29/08 8:11 a.m.
buddhabrad wrote: "Bubble bloggers would know more about the market if those with access to the data would publish it, rather than stuff the bad news in the top drawer and write goofy factless, baseless posts like these."
The problem is almost no one looks at it or tracks it. Instead they rely on the spin people put on it.
Report violation #123029Posted by Leanne Finlay at 4/29/08 9:25 a.m.
BB, you well know that there are weekly and daily articles full of stats. We'll have lots more to look at this week, not just in real estate.
Kary made an excellent point about sales statistics, yet it doesn't seem to be capturing much attention:
Roughly 33% of properties in our area SELL IN THE FIRST MONTH. Remind me again how that is reflective of a 'bad' real estate market?
Eleua, as our area continues to grow, prices here may well continue to escalate beyond salaries. It's all about supply and demand.
Report violation #123031Posted by Eleua at 4/29/08 9:29 a.m.
KLK,
When I write my best seller "Confessions of a Bubble Blogger," you are going to get an entire chapter. I could make a career out of you.
OK, let's take this slowly.
Eleua, I can only assume you're under 40 years old, and that you've never experienced significant inflation during your adult lifetime. As I mentioned in my prior post, the 7% figure doesn't account for inflation.
Close. I'm exactly 40, so I went through the mid-late 70s as a pre-teen, but I followed inflation fairly closely at that time and have a better real-world recollection of that period than most Babyboomers have of what is happening right in front of their eyes in the here-and-now.
Inflation in the mid-70s came from a combination of a falloff in American production in combination with a rise in debt-based spending. Much of this was an aftermath of the Vietnam war and zany social welfare programs. The money supply continued to expand (debt origination) while the goods and services it covered stagnated. That's why we developed the term "stagflation." Your premise is based upon us rerunning that peiord in history, which is a premise I find to be lacking in historical and economic reality. Inflation started to wane in the 80s when the productive capacity of the US started to expand rapidly, thus the goods and services covered by the debt originations actually reduced the inflation. The 80s also saw the beginnings of debt originations starting to flow to more speculative investments, thus reducing the amount of available debt to run up prices in commodities and other traditional inflation metrics.
Let's just assume that the rise in oil prices has the same effect on our economy as in the mid-70s. I'm not saying it will, but let's assume it will. If that happened your best investment right now would probably be to buy as much real estate as you can with 100% financing. The worst investment you could have would be a bank account. During periods of inflation, non-cash assets and debt are good.
You are essentially going "all in" on the idea that the next monetary phenomenon will be inflation, rather than deflation. Should you miscalculate, your entire portfolio will be perfectly positioned to ruin you.
When bankers expanded the loose lending standards in the mid-90s, the money supply exploded. This was most evident in bubble stocks and housing. The same house that sold for $200K in 1997 (and originated $160K in debt) now sells for $500K and originates $495K in debt. That's a lot more money created for the same asset. Extrapolate that across the economy and you have inflation.
Debt service is approaching unsustainable levels and will eventually reset itself in a massive deflationary spiral. As I eluded to in an earlier post, when debt service exceeds your ability to produce under any debt paradigm, that money is destroyed and the system resets itself.
We last saw this in the 30s.
Money is borrowed into existance and is destroyed by either paying off the debt or defaulting. Paying off a debt implies that some level of production was created and will count as an asset that can be pledged in debt to create more money, but default implies the exact opposite. Money is destroyed.
In a debt-based economy, the rate at which debt will default is hopelessly above what the actual productive base shrinks, thus the amount of goods and services divided by the amount of money becomes uncomfortably large. This is a deflationary spiral. Money actually becomes priceless as people are scrambling to pay down their debt and pledging what little they have left to do so. This causes even more deflation, more onerous access to capital, more defaults...later rinse repeat.
In your scenario, excessive debt and assets pledged in debt with little or no savings will earn you a one-way trip to a Pioneer Square flophouse. They bitter renter that has been saving 35% of his income in cold, hard cash will see his buying power increase.
After all, in order to buy the necessities in life, you will be selling what assets you have at firesale prices to those with the ability to buy them. People will be desparate to borrow money at any price and in order to entice those with more money than debt to loan money in a deflationary environment (shrinking collateral value), the interest rates will be huge.
Increasing money value with increasing interest rates...hmmmm....That's also tax-free in our current system.
Oil and commodities are presently on a speculative run because the FED is pumping huge amounts of money into our rancid banking system to forstall the reset. The primary dealers are taking the billions from the FED and chasing the latest bubble. They are short US Treasuries and long stocks and are getting hammered on that trade. They only have one play left and that is commodities.
When the FED starts to drain, you had better be clear of any commodity trades or you will take the express bus to Pioneer Square.
A shrinking economic output will crush the price of oil, and grains.
BTW, the comment that debt is the opposite of wealth would also indicate you don't have a business background. Going in debt to have a night on the town--bad. Going in debt to make money--good (depending on the results).
Nonsense.
I can borrow money to buy a productive asset. That asset has to produce above my debt costs as well as my operational costs to be viable. If not, I'm better off sticking the money in the bank.
I'm not saying that debt isn't useful. What I am saying is that debt is the opposite of wealth. If I buy a fishing boat and owe $500K on it, that $500K is an asset to the bank, not me. If I own it free and clear, the entirety of the boat is an asset to me. Whatever wealth production I get from that boat is reduced by what I have to pay to the bank.
If the boat's production (wealth value) is not in excess of the debt service, the boat is of no value TO ME. Get rid of the debt, and the boat's value goes up. With debt, the boat is only wealth to the bank.
I seriously hope you are not "all in" on a 35 year old economic phenomenon. We are not going to run that play. We are in the beginnings of a huge credit crunch (debt destruction cycle) and the US dollar is going to rocket in value.
I understand why you want to run the inflation paradigm. You have deeds to sell.
Report violation #123032Posted by Leanne Finlay at 4/29/08 9:33 a.m.
Amused, you said "As some other posters have alluded to, you know that you will have hit bottom when the average person thinks that real estate is a perfectly stupid investment"
I guess this means your crystal ball says we're at the bottom, since we've heard from many poster that now is a perfectly stupid time to buy :-)!
Report violation #123034Posted by Kary L. Krismer at 4/29/08 9:42 a.m.
Wow, quite the speech given I was just trying to refute your claim that there was no reason real estate prices would continue to escalate at 7% a year. I gave severe inflation as an example, and I assume you're not disagreeing with that, just as to the probability of significant inflation.
I do disagree with your analysis of what happened in the 70s, and what caused stagflation, but let's just say I don't see that repeating (the Fed is acting different today). I specifically said I wasn't trying to predict what will happen, but just trying to give a scenario where prices would continue to escalate (in nominal terms). That would be a period of inflation.
As to inflation/deflation, I'd think the former is more likely, but you're right in a deflationary period it would be just the opposite as an inflationary period as to what your holdings should be (your flop house comment).
As to the debt thing, I did say the results on borrowing for investment would be the determinative factor. Rather obviously if you borrow money, invest and then the investment doesn't go well, that's not a good thing.
Oh, and I completely disagree with your explanation as to why oil prices are so high today. But that too is yet another matter entirely.
Report violation #123036Posted by synthetik at 4/29/08 9:43 a.m.
KLK=pwned
Report violation #123037Posted by Kary L. Krismer at 4/29/08 9:44 a.m.
Amused and I have something in common. We both have a bit of the contrarian bug in us.
Report violation #123038Posted by Amused at 4/29/08 9:46 a.m.
Leanne,
I'm not sure if the posters here qualify as "average people". (grin)
Given some recent RE conversations with people who don't post on RE blogs, the belief in RE as an investment is starting to fade, but there is still some hope that things will turn around in the near future - how this summer goes will probably be pretty decisive in changing people's longer-term expectations.
Report violation #123039Posted by Eleua at 4/29/08 9:46 a.m.
Leanne,
Eleua, as our area continues to grow, prices here may well continue to escalate beyond salaries. It's all about supply and demand.
Nonsense.
Home prices are teathered to peoples' ability to buy, and that ability to buy is comes in three forms:
income (sustainable debt service)
cash purchase (equity transported from Orange County, savings, inheritance, stock sale, etc.)
kinky loan package (unsustainable debt service)
If someone makes $100K/yr, they can't pay $110K/yr for a home. The idea that our area is so desireable that home prices can decouple from the underlying economic supports is the laughable twaddle that got us into this mess in the first place.
It may happen, but only in short bursts and it has to correct back to the fundamentals.
When the PNW has an unemployment rate higher than the national average (coming soon), you are really going to look silly trying to sell houses to people with a debt service in excess of their incomes.
Report violation #123040Posted by laxtosnoco at 4/29/08 9:46 a.m.
"I think if you look at the official NAR line, it's something to the effect that on average real estate prices increase in excess of 6% a year and double every 10 years. I'm the one that said 7, because if they double every 10 years, it's just short of 7 (I'm rounding up)."
The advertisement I saw last night said that house prices typically double every 10 years. The only disclaimer I heard was that 'local market conditions may differ' and that I should check with my local Realtor to learn more. If a stockbroker advertized like the NAR does without a strong "past-performance doesn't dictate future returns" statement, that stockbroker would end up in a heap of trouble.
Kary's trying to defend this because we might have some serious inflation and the 'double in value' might be true in nominal terms. Are you serious? So we are now recommending and analyzing investments based on their nominal performance?
As you may know, the most exhaustive study of home prices by Prof Shiller suggests that prices have increased at a rate less than 1% over inflation. Other long term studies show similar trends.
If the NAR was honest, shouldn't their pitch be something like:
"Right now you may have heard about widespread housing price decreases. While we are seeing unprecedented price declines accross the nation, you should know that housing price appreciation has traditionally outperformed inflation. If you buy a house that you can afford and plan to live in it for many years, owning a home has historically been a better investment than renting."
Report violation #123041Posted by Kary L. Krismer at 4/29/08 9:52 a.m.
Lax wrote: "Kary's trying to defend this because we might have some serious inflation and the 'double in value' might be true in nominal terms. Are you serious? So we are now recommending and analyzing investments based on their nominal performance?
As you may know, the most exhaustive study of home prices by Prof Shiller suggests that prices have increased at a rate less than 1% over inflation. Other long term studies show similar trends."
Lax, part of the reason I was bringing up inflation was to point out that the 7% wasn't really 7%. Sorry if that wasn't clear. I think Shiller is low on his 1%, but it's clearly not anywhere close to 7%.
Report violation #123042Posted by Kary L. Krismer at 4/29/08 9:55 a.m.
Lax wrote: "Kary's trying to defend this because we might have some serious inflation and the 'double in value' might be true in nominal terms. Are you serious? So we are now recommending and analyzing investments based on their nominal performance?"
No, as I stated, I was only addressing this comment:
Eleua wrote: "The idea that real estate can appreciate 7%/yr without end is a perfectly stupid idea. If incomes only go up 2-3%, how can RE go up 7%? ..."
I pointed out inflation. I think it was Leanne that pointed out population growth. You could also through in land use regulations and a number of other factors.
But remember, I'm not trying to show that real estate prices will rise or fall. I don't make such silly predictions.
Report violation #123043Posted by Eleua at 4/29/08 9:59 a.m.
For those of you who actually believe that home appreciation can outstrip income inflation for any meaningful length of time, I developed a little tool to illustrate how that is not possible.
anon688.googlepages.com/Mort.xls
It's a simple spreadsheet that shows how quickly homes can become too expensive and must correct.
You can change the assumptions in interest rates, income inflation and house inflation.
Sorry, the 25year expansion of home prices has been fueled by cheap credit and a diversion of production into the finance sector. Both of these will unwind in a rapid, and grotesque fashion.
Seriously, we are looking at 20cents on the dollar within a few years.
Report violation #123044Posted by Eleua at 4/29/08 10:07 a.m.
KLK,
More nonsense.
A 2-3% rise in wages IS INFLATION. For homes to appreciate at 7% (or whatever), you would need inflation in wages to do the very same, if not more (tax bracket creep).
What I am saying is home prices can't appreciate beyond peoples' ability to pay, and inflation is a moot point in that statement. If inflation is 5000% in wages, then you can get 5000% in homes.
Population growth and land restrictions are opposing forces. If housing units are limited, more people won't move here, unless they all sleep on the streets.
If 5 million Peruvian peasants all moved to Seattle, what would that do to real estate?
Nope. You need large numbers of high earners to drive prices. People do not equal demand. Money = demand.
Report violation #123045Posted by Marlow Harris at 4/29/08 10:13 a.m.
RE: Violating TOS: Attributing items of interest to a source is not a violation of the terms of service. Because of the nature of our topic, we're apt to quote a lot of sources in our industry. I would not automatically assume that naming those sources would constitute a violation of the terms of service unless it appears that it was done merely to promote rather than inform and share.
Please try to stay on topic and to stay civil.
Report violation #123046Posted by Kary L. Krismer at 4/29/08 10:14 a.m.
Eleua wrote: "Sorry, the 25year expansion of home prices has been fueled by cheap credit and a diversion of production into the finance sector. Both of these will unwind in a rapid, and grotesque fashion."
Yep, had absolutely nothing to do with the increase in the number two earner households over the past 25 years, or any other factor, such as population growth, changing tastes, larger houses, etc.. Entirely due to one factor. Yep, that one factor is the entire cause. Yep it is. And if Eleua says it one more time, it will be even more true.
Report violation #123054Posted by Eleua at 4/29/08 10:30 a.m.
KLK,
Population growth only drives RE prices if that population has a greater income. Two income earning households have contributed to a more productive lifestyle and debt service has detracted from that. Before you pronounce the magic elixer for the RE industry (two income families), you first need to correct for the amount of production that has been siphoned off by debt.
Also, what drives it further? Three income families?
There is no doubt that certain parts of the economy have expanded outside of the debt sector. Software would be one of them. Unfortunately, we are not on our own currency in the PNW, so what happens in NYC, or Dallas has an effect on what happens here.
Just as it was folly when our local RE salesmen were saying that housing problems in Miami, Orlando, Boston, and San Diego would not hit Seattle, it is also folly to assume that deflationary problems in areas built on excessive debt originations will not weigh on our little wonderland.
They will.
If Dallas is on US dollars and experiences deflation, Seattle can not experience inflation. The value of a US dollar is the same in Chicago as it is in Seattle.
Report violation #123057Posted by The Tim at 4/29/08 10:35 a.m.
I would not automatically assume that naming those sources would constitute a violation of the terms of service unless it appears that it was done merely to promote rather than inform and share.
Marlow, I agree that we shouldn't automatically assume. But when questioned in the third comment to this post (#122870), Leanne openly admits that the post is indeed "a blatant advertisement" (#122872).
So isn't it no longer assumption at this point?
Report violation #123070Posted by synthetik at 4/29/08 11:13 a.m.
The rules don't apply to them The Tim.
Supposedly their advertising dept. has no relationship with their editorial dept. when this is patently false and obvious to the most casual observer.
Fraud and lies like these are rampant in our society but most rampant with real estate agents (NAR), mortgage brokers, RE appraisers and banks/IBs, the FED and our government.
This is changing right now, but the most of the liars are still in denial phase (see this post). The excesses will be flushed from the system but it won't be overnight.
Report violation #123080Posted by Leanne Finlay at 4/29/08 11:30 a.m.
The Tim, Synthetic and Eleua, you are all creating off topic discussions, and deliberately trying to create distubance.
You are not real estate agents, so please refrain from abusing the real estate agents and anyone else on this forum.
This was supposed to be a mellow discussion of choices, questions and answers for buyers or sellers, not a place for your snarkiness.
My goodness, don't you all have jobs to go do? The Tim, go write the Naked Loon, I think that's a great parody piece, and well worth spending energy on.
Report violation #123086Posted by Eleua at 4/29/08 11:51 a.m.
Leanne,
When you post something that isn't loaded with historical and economic innacuracies, people won't have anything to disagree with.
Nothing I have said here borders on abuse of a RE agent.
The invitation was to buyers and sellers. I have been on both sides of that trade and anticipate doing so in the future. My temporary absence from the RE trade is explained in my postings and some people my find it of value.
I can't bring myself to apologize for bringing an uncomfortable truth to a public forum discussing a hot current event. It's a shame you are so displaced by a frank discussion of the fundamentals that underpin your profession.
Sometimes it isn't a good time to buy.
Report violation #123093Posted by Dugald Allen at 4/29/08 12:08 p.m.
Someone asked - about four pages back - whether investors are coming back into the market...
I guess this ties in a little to Eleua's statement:" Sometimes it isn't a good time to buy.
The answer is yes and no.
Tighter lending standards have made it harder for your typical small real estate investor to use regular non-owner-occupied (NOO) loans with high loan-to-value (LTV) ratios.
However, borrowing money from a bank is only one way to fund a project and in these days of low interest CDs and fixed-income investments, there are many investors becoming banks themselves and the private money opportunities are plenty.
There are also opportunities for seller-financed purchases. FHA offers a rehab loan, too.
However, the new laws stemming from HB1843 and HB2791 that make it more restrictive and more expensive to do the investing will have some impact on the numbers of investors out there.
There are certainly plenty of homes out there to choose from!
d'oh!
Report violation #123095Posted by synthetik at 4/29/08 12:09 p.m.
Leanne,
The way I see it, you are the one creating the disturbance. You may not see it, but anyone who buys in now is going to get slaughtered.
As far as working, my main job is shorting the market and banking profits from the folly of people who follow your advice. I also own a recruiting company.
Report violation #123098Posted by Kary L. Krismer at 4/29/08 12:15 p.m.
Eleua wrote: "A 2-3% rise in wages IS INFLATION. For homes to appreciate at 7% (or whatever), you would need inflation in wages to do the very same, if not more (tax bracket creep)."
The first and second sentences are simply incorrect.
If only you worked for the Fed. You could combat inflation simply by cutting pay! :-D
Report violation #123105Posted by Kary L. Krismer at 4/29/08 12:23 p.m.
Eleua wrote: "When you post something that isn't loaded with historical and economic innacuracies [sic], people won't have anything to disagree with."
Eleua, I wouldn't be going around trying to point out errors in other people's economic theory, since economics is clearly one of your shortcomings. Just about every other sentence you write has some error in it.
For example this: "If Dallas is on US dollars and experiences deflation, Seattle can not experience inflation. The value of a US dollar is the same in Chicago as it is in Seattle."
Assuming you're talking CPI, they do track those by city, because they do vary by area. Over the long term they will be relatively the same however. Assuming you're talking about real estate prices, it's simply incorrect.
The first sentence in that same post was also incorrect.
Report violation #123108Posted by Eleua at 4/29/08 12:32 p.m.
KLK,
My entire point is that wages and home prices are linked. How they inflate (or deflate) is irrelevant. Call it what you will.
I don't care if rising wages comes from higher productivity, monetary inflation, gold falling from the sky, etc., however it is measured, houses can't appreciate beyond that without straining the credit system.
Thanks synthetik. For how useless the original post was, the comments actually had some good content. It's too bad they wiped the comments and kept this week's Top 10 super duper incredibly fantastic reasons to buy now now now list. At least this has most of the good stuff in it.
Kary thinks bubble bloggers are more extreme than Reverend Wright. Apparently thinking home prices will decline is more extreme than thinking the US government created the AIDS virus. Awesome.
As if I'm going to waste any more of my time commenting on their booster club faux-blog advertisement.
I'll answer Kary's question, but not on a forum where the answer might up and disappear in a few hours for unknown reasons. If someone wants to link him to this, feel free (this link would probably be best).
In the other thread, "The Tim" said that he saw this as a better time to buy than 2005. My response was that was odd, since prices are higher now. I'm not sure he ever explained himself. ... But I'd love to hear directly what the thought was behind that comment...
I think today is a better time to buy than 2005 for all the reasons listed in that puff piece top 10 list yesterday (more selection, less pressure, etc...), and also for a couple additional reasons.
First, the false hope of unending yearly 10%+ appreciation has been all but eliminated, and most people (despite what Kary seems to believe) have come to accept that home prices will be going down for at least a few years, so today's buyers know full well what they're getting into.
Second, most (not all, but most) of the insane and dangerous financing for people without the income to support a huge mortgage has dried up. So if you're buying today, it's most likely with sound financing and a mortgage that you can afford to pay over the long term. In 2005, huge numbers of people were buying with suicidal financial instruments, just because they were available.
Note that I definitely did not say that now was a better time to buy than 2009 or 2010 will be. Just that now is a better time to buy than 2005. Summary: now you can take your sweet time, drive a hard bargain, if you qualify for financing at all, it's probably something manageable, and most importantly, if you're buying today, you know that you are buying a place to live, not some sort of get rich quick scheme.
As to being incorrect and fringe, if bubble bloggers beliefs were common, more than 10% of listings would be sold without a buyer's agent on the other side. That apparently isnt' the case based on the limited searches I've done (I can't track it directly, I can only determine where there is no co-broker). If bubble bloggers beliefs were common, more people would be using rebate brokers, but they aren't (one limited search I did put that number in King County under 2% of all transactions).
I liked this quote from the other blog, because I think it foreshadows what's really going to happen. If bubble bloggers are right, there are two groups out there, the smart and the oblivious. The smart are not buying much at all, but when they do buy they use discount brokers or no broker at all. Looks like maybe 12% of all buyers in todays market are smart. The rest are oblivious. Se la vi.
So any Realtors(R) out there, don't be comforted by this logic. Your livelihood is literally at stake, and you will need to be on your game if you want to make it through the next two years. Wishful thinking and fighting market trends is what the RIAA did, and look at what is happening to their industry.
Alan, you are never going to make it as a RE Professional if you keep using words like "orthogonal". (grin)
That's not true at all. I saw a listing the other day touting new orthogonal tile in the kitchen. Haven't you heard that orthogonal designs are this year's granite?
This is a better time to buy as far as having less buyers to bid up prices by using mortgages such as stated income. Imagine if we could use the "way back" machine and eliminate that product (especially for W2 employees and for those who overstated). Stated income gave many buyers blank checks to buy whatever their hearts desired regardless of what would "make sense". Insane.
I think about this often. Imagine if you were buying a home in 2005-mid07 and were bid-up by a stated income borrower. I never liked those mortgages. Now I get calls and emails from all over the country, "please help me, I need to refinance...my arms adjusting and I bought this using stated and I don't have the income...". It's ugly.
Now there are no (actually a few subprime lenders will do stated) or much less stated income buyers. Having the remaining buyers having to actually qualify for their mortgage does create better conditions for fellow buyers. Who wants to compete with somethng artificial?
Interesting quote from Matt at Urbnlivn regarding Olive 8:
The hotel opens December 15th with the condos closing January 2009 to June 2009.
As it turns out I know a shocking number of people who bought at Olive 8. Only one of them is not an agent. Probably half these purchases are doing it as an investment.
Wow. Should we start a pool on how many of these condos actually close?
****************************I LOVE TO PAY RENT!****************************
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Anybody have the stomach to try calling the number and listening to the message?
****************************I LOVE TO PAY RENT!****************************
Quit telling yourself that you love being a tenant and making your Landlord rich! Get the facts and learn how you can stop paying rent, own your own home and live the life you deserve. Call for the FREE report that reveals 5 ways for you to buy a home with little or no down payment! Call 24-hour Consumer Hotline at 1-888-836-2735 ext. 110, for a recorded message and to order your FREE report today. Stop the lie, you can buy! Free Info provided by Douglas Gracia, Keller Williams Realty Bellevue WA. 98004 Direct: (425) 891-2941 Office: (425) 454-0911
Anybody have the stomach to try calling the number and listening to the message?
I saw this on craigs list also, I called and I am now preapproved for a mortgage and my wife and I are going to get our first home!!! Doug Gracia is a GREAT guy!! He is very patient and a true professional. The LOOSER that posted this must not have a life and only wants to discredit good people!!! Go back to sleep As_ Hole
I saw this on craigs list also, I called and I am now preapproved for a mortgage and my wife and I are going to get our first home!!! Doug Gracia is a GREAT guy!! He is very patient and a true professional. The LOOSER that posted this must not have a life and only wants to discredit good people!!! Go back to sleep As_ Hole
Anthony Casella
Let's see, just one post by Anthony and it's an advertisement for this service. What are the odds that "Anthony" and "Doug" knew each other before he "called"?
It's like KLK and LKC didn't even bother to take the time to read the Case-Shiller methodology that explains quite clearly how the index is calculated using pairs of sales from the same homes.
Also amusing to me is the fact that the big difference he is writing the entire post about can be easily explained by a shift in the mix of sales, as you suggested in the comments, and as I just happened to specifically address at the end of today's post, coincidentally published just minutes after this latest nonsensical screed at SRP.
Kary's hardheaded "no one can ever predict anything" stance gets old after reading it in a few dozen threads, but it's Larry and Mack that ultimately keep me away from that place and IMO really bring down the discussion there, and their thin pall of arrogance really turns me off to the place. They are much more interested in insults and humor at the expense of others than actually having a discussion. If I went by their comments alone, I'd say neither knows a thing about real estate -- the quailty of their participation certainly doesn't lead me to have any confidence in them whatsoever, certainly enough to put them on my exclusion list of possible agents I'd use.
It also doesn't help to have drive-by comments from bears as well that just insult and don't contribute (yes, I'm looking at synthetik). But what some of the contributors fail to see over there, I think, is they do the same thing, but under the guise of a "professional". Until they learn to accept differering opinions and have real discourse, that site will remain a third-rate back patting party.
But what some of the contributors fail to see over there, I think, is they do the same thing, but under the guise of a "professional". Until they learn to accept differering opinions and have real discourse, that site will remain a third-rate back patting party.
What I don't understand is why they are still patting each others backs. Prices have rewound to early 2006 on average and overall affordability is back even further. If you took the professional's advice in summer 2005 and bought you now have little to show for it and a still strong recession hanging over your head. Even if you listened to the professionals in 2003 you run a very real risk of nil or even negative gains. For keeping track at home, nil gains means you've been throwing your money away "renting" capital from the bank with no asset appreciation to show for it.
Anyways, Mack is the one who always rubbed me the wrong way. While most of the people on that sight are both wrongheaded and adamant about how right they are, he's wrongheaded, adamant, and smug at the same time. It's that final distasteful character trait that goes over the top for me.
Comments
Seems the TOS was just being used as an excuse to promote a personal quest to undo the genericization of a particular trademark.
She reminds me of a lady at church that was trying to convince us last year that it made so much more sense to buy than to rent. I didn't want to get into an argument so I just told her that my income wasn't high enough to buy. Her reply? "You don't need income to buy a house." (Not exact words but pretty much what she said). I was shocked and didn't really know how to reply to such ignorance.
Translation: "The truth! It burns! Make it stop!"
Also, I tried to comment but got this error: "Error: Your IP address has been banned. You cannot submit a comment"
Well, I happened to have most of the original post, up until around 1pm today.
http://blog.seattlepi.nwsource.com/real ... 137774.asp
I'll answer Kary's question, but not on a forum where the answer might up and disappear in a few hours for unknown reasons. If someone wants to link him to this, feel free (this link would probably be best). I think today is a better time to buy than 2005 for all the reasons listed in that puff piece top 10 list yesterday (more selection, less pressure, etc...), and also for a couple additional reasons.
First, the false hope of unending yearly 10%+ appreciation has been all but eliminated, and most people (despite what Kary seems to believe) have come to accept that home prices will be going down for at least a few years, so today's buyers know full well what they're getting into.
Second, most (not all, but most) of the insane and dangerous financing for people without the income to support a huge mortgage has dried up. So if you're buying today, it's most likely with sound financing and a mortgage that you can afford to pay over the long term. In 2005, huge numbers of people were buying with suicidal financial instruments, just because they were available.
Note that I definitely did not say that now was a better time to buy than 2009 or 2010 will be. Just that now is a better time to buy than 2005. Summary: now you can take your sweet time, drive a hard bargain, if you qualify for financing at all, it's probably something manageable, and most importantly, if you're buying today, you know that you are buying a place to live, not some sort of get rich quick scheme.
I liked this quote from the other blog, because I think it foreshadows what's really going to happen. If bubble bloggers are right, there are two groups out there, the smart and the oblivious. The smart are not buying much at all, but when they do buy they use discount brokers or no broker at all. Looks like maybe 12% of all buyers in todays market are smart. The rest are oblivious. Se la vi.
So any Realtors(R) out there, don't be comforted by this logic. Your livelihood is literally at stake, and you will need to be on your game if you want to make it through the next two years. Wishful thinking and fighting market trends is what the RIAA did, and look at what is happening to their industry.
Well, maybe not completely orthogonal but no less than 75 degrees.
Alan, you are never going to make it as a RE Professional if you keep using words like "orthogonal". (grin)
That's not true at all. I saw a listing the other day touting new orthogonal tile in the kitchen. Haven't you heard that orthogonal designs are this year's granite?
Especially those sustainably harvested orthogons.
Orthogonal designs are for squares.
Heresy! Lolcats are the best Internet meme ever invented! I cn haz hous? kthxbye
I think about this often. Imagine if you were buying a home in 2005-mid07 and were bid-up by a stated income borrower. I never liked those mortgages. Now I get calls and emails from all over the country, "please help me, I need to refinance...my arms adjusting and I bought this using stated and I don't have the income...". It's ugly.
Now there are no (actually a few subprime lenders will do stated) or much less stated income buyers. Having the remaining buyers having to actually qualify for their mortgage does create better conditions for fellow buyers. Who wants to compete with somethng artificial?
Wow. Should we start a pool on how many of these condos actually close?
Did Ardell ever list her home? Zillow's Zestimate keeps heading down.
$915K as of May 2....
Remember - buy or have your manhood questioned! Coming soon to an ad campaign near you!
Anybody have the stomach to try calling the number and listening to the message?
I saw this on craigs list also, I called and I am now preapproved for a mortgage and my wife and I are going to get our first home!!! Doug Gracia is a GREAT guy!! He is very patient and a true professional. The LOOSER that posted this must not have a life and only wants to discredit good people!!! Go back to sleep As_ Hole
Anthony Casella
Heh. I've never been big on pointing out typos, but when you put your typo in all caps it is pretty funny.
Let's see, just one post by Anthony and it's an advertisement for this service. What are the odds that "Anthony" and "Doug" knew each other before he "called"?
It's like KLK and LKC didn't even bother to take the time to read the Case-Shiller methodology that explains quite clearly how the index is calculated using pairs of sales from the same homes.
Also amusing to me is the fact that the big difference he is writing the entire post about can be easily explained by a shift in the mix of sales, as you suggested in the comments, and as I just happened to specifically address at the end of today's post, coincidentally published just minutes after this latest nonsensical screed at SRP.
It also doesn't help to have drive-by comments from bears as well that just insult and don't contribute (yes, I'm looking at synthetik). But what some of the contributors fail to see over there, I think, is they do the same thing, but under the guise of a "professional". Until they learn to accept differering opinions and have real discourse, that site will remain a third-rate back patting party.
What I don't understand is why they are still patting each others backs. Prices have rewound to early 2006 on average and overall affordability is back even further. If you took the professional's advice in summer 2005 and bought you now have little to show for it and a still strong recession hanging over your head. Even if you listened to the professionals in 2003 you run a very real risk of nil or even negative gains. For keeping track at home, nil gains means you've been throwing your money away "renting" capital from the bank with no asset appreciation to show for it.
Anyways, Mack is the one who always rubbed me the wrong way. While most of the people on that sight are both wrongheaded and adamant about how right they are, he's wrongheaded, adamant, and smug at the same time. It's that final distasteful character trait that goes over the top for me.
Granted, leverage would kill most people in real estate, but if you purchased with cash then you would be better off.