Local real estate agent on CNBC

edited December 2008 in The Economy
http://www.cnbc.com/id/15840232?video=821093962&play=1

Go to 5:45 of the video.

Taking advice on how much home you can afford from a real estate agent..bad idea.
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Comments

  • God, what an idiot. She cashed out her IRAs? What will she retire on? Housing costs 50% of income?!?

    Geez, I have no sympathy for this woman. None.
  • God, what an idiot. She cashed out her IRAs? What will she retire on? Housing costs 50% of income?!?

    Geez, I have no sympathy for this woman. None.
    My wife was an agent several years ago when this 50% thing became ok. That is when we knew this would become a bubble. We knew it would infuse the market with huge demand, severely impacting price and affordability. If we had followed through on our belief we would have bought all we could and sold for huge profits. Instead, we just thought it was crazy. It is why I have been expecting this crash to happen long before it actually did. One guy said these things always take longer to arrive than predicted, but then unfold faster than predicted. This one seems to be proving that to be true.
  • I guess what's more disturbing is that she still believes that the market is strong. Then again, I guess it's to be expected considering what she does for a living.

    What will she do if her income goes from 70K to 35K....or 0? Will she still say the market is strong here in Seattle or blame the media hype machine? It seems logical to me if the media hype is driving prices down here then the same media hype drove the prices up to an insane level. They can't have it both ways.

    "We NEED this house. We can do this......" - wife from the Suzanne commercial
  • I think I found "Kim in Issaquah."

    Noticed her in one of the shots dinking with a John L. Scott sign, so I figured she was probably a John L. Scott agent. Looked for any Kims or Kimberlys in John L. Scott offices around Issaquah, and I found Kim Giles:

    Looked her up in King County Records and found that in November '06 she sold her condo for $300,000, and in December '06 she closed on a $600,000 home in Issaquah Highlands, so that fits her description of having lived there for "about a year and a half."

    Should be pretty easy to follow up on whether she decides to keep the home or sell it.
  • "I have a great loan. 5% Fixed for 10 years interest only...why should I give up this great mortgage?"

    She's saying she wanted to stay in the home for two years to finish up in that school district for her daughter.

    Intersting.
    Child support ends in 2 years.

    I bet she thought she could sell easily.

    Now her income has dropped substantially and she needs the TV reporter to tell her that her income is going to continue to go down. Hmmm.

    I wonder how many other real estate agents need a TV reporter to tell them: "Your mortgage payment should be more like 30% of your income. Right now it's 50%"

    The TV reporter tells her to "get out now."

    Wow. How humbling. I think we should watch that address to see if she decides to put her home on the market.

    Hey, the credit guy at the end says a short sale, a foreclosure, or a deed in lieu are all treated bad by the credit bureaus.

    I thought a short sale was slightly less damaging.
  • please please please let me never have my investment decisions dissected on a blog....

    I guess if I just stay off of tv, I should be ok

    :?
  • Hi deejayoh,

    That's something I don't understand: Why subject oneself to national TV exposure? masochistic tendencies? Was she thinking that the exposure would help her real estate career?
  • I think she really just wanted help. I felt sorry for her, personally. I can see how that could happen to someone.

    The are plenty active participants here who have posted about not being able to talk family members out of diving into the market in an ill-timed and over-leveraged way.

    I actually think that columnist gave pretty crappy advice to the first guy. "sell your house and rent" when its the same monthly nut? Um, what about the tax shield? Maybe he could have cut his $1000 utility bill and $700 gas bill first and kept his house, since it would probably cost him less per month than renting net of taxes? Even if he took a HELOC he'd still come out ahead, keep his house, and have a little cash. She was just moving the deck chairs to get at his equity as a quick solution.
  • Really? If he cashes out now he can pay off his credit card and cut out $850 in credit card minimum payments. Plus it's just going to disappear in a few years anyway so might as well take it and use it rather than lose it. Another reason to sell the place would be to downsize. He doesn't have to live in a comparable place especially since he's in such a dire situation. Nobody will die if they don't have their own bedroom. :D
  • I'm not gonna do a spreadsheet on it - but If IIRC, the mortgage was $1900 which would shield $600 in income vs. rent. That pays most of the CC bills - but if you roll it into a heloc it lowers the rate - which lowers the payment - and most people would write that interest off too (even tho you're not sposta, but this is the real world)

    My point was more that if you are making$5k per month a $1900 mortgage is not your issue when you have $700 gas cost and $1000 in utillties. Its spelled B-U-D-G-E-T-I-N-G. Doesn't seem like a dire need to sell the home.
  • deejayoh wrote:
    please please please let me never have my investment decisions dissected on a blog....

    I guess if I just stay off of tv, I should be ok
    FWIW, I don't plan to post about Ms. Giles on the blog, but it does seem like her going on national TV to talk about the details of her financial life is something of an invitation for anyone and everyone to dissect her money situation further.

    It's not as if there aren't countless options for getting some sound financial advice that don't involve going on TV.
  • Nobody will die if they don't have their own bedroom. :D

    Shhhhh, the thought police don't like to hear this kind of talk.
  • We should invite her to join in the conversation about her.

    She also owns an investment condo (which was an apartment conversion). She had a couple of fantastic experience in real estate investment and decided to double-down at the peak. Still, she seems to be pretty far from being in financial trouble but I guess she see where the track is heading.

    I almost got the impression she went on national television to get some boosterism in about the Seattle area. If she can drum up enough demand then maybe she can sell her house not at a loss.
  • Alan wrote:
    Still, she seems to be pretty far from being in financial trouble but I guess she see where the track is heading.

    Multiple months without a paycheck sounds like deep trouble to me.
  • Alan wrote:
    Still, she seems to be pretty far from being in financial trouble but I guess she see where the track is heading.

    Multiple months without a paycheck sounds like deep trouble to me.
    When my wife was an agent I learned that agents could be divided into four groups:
    1. New agents
    2. Agents that made a LOT of money becuase they used to work their butts off (and maybe still do).
    3. Agents that make a living but are working basically all the time. They MAY eventually find themself in group 2.
    4. Agents that have a spouse that makes a good living at something else.

    I believe the median income for real estate agents is around $25,000 per year.
  • Dang..I'm having troubles opening the video. :( Does it take forever to load?
  • Rhonda
    try opening it using firefox. I couldn't get it to start in IE either
  • It worked in IE for me, but it took longer.
  • Robroy wrote:
    Alan wrote:
    Still, she seems to be pretty far from being in financial trouble but I guess she see where the track is heading.

    Multiple months without a paycheck sounds like deep trouble to me.
    When my wife was an agent I learned that agents could be divided into four groups:
    1. New agents
    2. Agents that made a LOT of money becuase they used to work their butts off (and maybe still do).
    3. Agents that make a living but are working basically all the time. They MAY eventually find themself in group 2.
    4. Agents that have a spouse that makes a good living at something else.

    I believe the median income for real estate agents is around $25,000 per year.

    Being an agent, Rob Roy is right, but he forgot about one type:

    5. Agent who never works and never actually closes a deal.

    With real estate, the numbers are something like 93% of all real estate deals are closed by about 7% of the active agents.

    Last year the average number of house sales per agents with the NWMLS was about 2.1 per agent.

    That means there were ALOT of agents not even making a paycheck.

    I suppose that #1 and #4 also fall into the category of #5, however I've seen tons of agents who just come into the office all day and suck up everyone else's time.
  • Yeah, I forgot about number five!
  • She has moved to Windermere. No listings.

    Her crib is still not on the market. Gotta list it to sell it, honey.

    http://windermere.com/index.cfm?fuseact ... _ID=322390
  • Maybe it is a pocket listing.
  • Alan wrote:
    Maybe it is a pocket listing.

    What is a pocket listing?
  • http://en.wikipedia.org/wiki/Pocket_listing
    A pocket listing is a real estate industry term used in United States which denotes a property where a broker holds a signed listing agreement (or contract) with the seller, whether that be an "Exclusive Right to Sell" or "Exclusive Agency" agreement or contract, but where it is never advertised nor entered into a multiple listing system (MLS) or where advertising is limited for an agreed-upon period of time. In Canada, this is referred to as an "Exclusive Listing".
  • Aren't they against MLS rules?
  • And how would you ever be able to sell it without advertising it?
  • She has moved to Windermere. No listings.

    Her crib is still not on the market. Gotta list it to sell it, honey.

    http://windermere.com/index.cfm?fuseact ... _ID=322390
    Heh, I love that she put "As Seen On CNBC!" in her profile, but didn't mention the context. More likely she's hoping that folks reading that page didn't see her on CNBC, and will just assume that she was on there as some sort of expert or something.

    [Addendum:] Hah! I get the feeling she hasn't done a Google search for Kim Giles CNBC. Or she's just hoping that nobody else will.
  • If you don't put something on the MLS then you don't have to follow the MLS rules with it.

    I don't know how pocket listings are advertised or why a seller would want to do it.
  • If anyone wants to know about pocket listings and NWMLS rules, this post on RCG is probably a good place to start: Pocket Listings in Seattle?

    Well, not so much the post itself, but the lengthy conversation that follows in the comments.
  • Update:

    As of October 30, Ms. Giles' home is still not on the market. One of her neighbors is trying to sell though.

    2136 NE Noble St Issaquah, WA 98029
    28135854_1.jpg

    330 sqft bigger, 1 year newer, and an asking price the same as what Ms. Giles paid for her place in 2006 ($600,000). Oh, and it's been on the market for over 80 days.

    Recently sold comparable properties in the Issaquah Highlands have gone for between $560,000 and $585,000. If Kim G. wanted to sell her home this decade without losing tens of thousands of dollars, it looks like she missed her chance.
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