March 2, 2006

‘A Buyers Market Is Not At Or Near The Peak’

A Florida writer had a letter printed in the Sun Sentinel. “Re: ‘Sellers be patient; buyer’s market returns’ (Monday): The headline suggests it’s a good time to buy.”

“The housing market has slowed, inventories are way up, sales are way down, prices are flat. That’s called a ’stalled market,’ and will likely be recognized as ‘the peak’ once we gain a little hindsight. The next likely phase (already starting) is price reductions and purchase incentives.”

“Real estate values don’t change on a dime like stocks sometimes do. It’s more like turning a big ship around.”

“Since price increases have stalled, there is absolutely no urgency left to ‘get in before it’s too late.’ Buyers would be wise to wait and see if prices will in fact decline, rather than buying into a falling market.”

“Although the leverage of buyers is increasing at the moment, a ‘buyer’s market’ is not at or near ‘the peak,’ but rather at or near ‘the bottom.’”

“I also question your advice for sellers to ‘be patient.’ There is growing consensus that substantial price declines are in order. Watching inventory rise around you and the value of your asset decline as you remain ‘patient’ may not be a desirable strategy.”




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136 Comments »

Comment by GetStucco
2006-03-02 13:52:07

It is surprising that this very honest and accurate letter was published…

Comment by GetStucco
2006-03-02 13:52:54

P.S. I would strike “ship” and substitute “oil tanker”, e.g., the Exxon Valdez…

Comment by Iknowso
2006-03-02 15:06:28

Maybe an aircraft carrier :)

 
Comment by Peter P
2006-03-02 17:54:27

How about a super battleship, like Yamato?

 
 
Comment by tampaesq
2006-03-02 15:29:30

Yeah, it’s nice to see some honesty somewhere in FL. I just caught the local news here in Tampa, and they had a lovely piece on Trump, who was apparently here today with his golden shovel for the official Trump Tower Tampa groundbreaking. Puke. They had a bunch of douchebag “investors” talking about how exciting it will be to own a unit in the most expensive and exclusive building in Tampa. What a dubious honor. Oh, and my favorite was the “investor” who said that the reason he bought in was because Trump is a real estate whiz who can’t go wrong. Guess this guy was in the arctic during the 90’s.

Comment by OutofSanDiego
2006-03-03 06:33:36

Trump has always interested me… mainly why he is thought so highly of when his record doesn’t support it. He is a spoiled, conceited rich kid who has lived a high life style at others expense. Here is some great trivia for anyone that might be interested:

Donald Trump
-Trump began his career at his father’s company, the Trump Organization, and initially ‎concentrated on his father’s preferred field of middle class rental housing. In the 1970s he ‎benefited from the financially strained New York city government’s willingness to give ‎tax concessions in exchange for investment at a time of financial crisis.‎
- Bankruptcy
By 1990, the effects of recession left him unable to meet loan payments. Although he ‎shored up his businesses with additional loans and postponed interest payments, ‎increasing debt brought Trump to business bankruptcy and the brink of personal ‎bankruptcy. Banks and bondholders had lost hundreds of millions of dollars, but opted to ‎restructure his debt to avoid risking losing even more in a court fight. ‎
- By 1994, Trump had eliminated a large portion of his $900 million personal debt and ‎reduced significantly his nearly $3.5 billion in business debt. While he was forced to ‎relinquish the Trump Shuttle (which he had bought in 1989), he managed to retain Trump ‎Tower in New York City and control of his three casinos in Atlantic City. Chase ‎Manhattan, which lent Trump the money he needed to buy the West Side yards, his ‎biggest Manhattan parcel, forced a sale of the parcel to Asian developers. According to ‎former members of the Trump Organization, Trump did not retain any ownership of the ‎site’s real estate - the owners merely promised to give him about 30 percent of the profits ‎once the site was completely developed or sold. Until that time, the owners kept Trump ‎on to do what he did best: build. They gave him a modest construction fee and a ‎management fee to oversee the development. They also allowed him to put his name on ‎the buildings that eventually rose on the yards because his well-known moniker allowed ‎them to charge a premium for their condos.‎
- Saved by Dad: In 1999 Donald’s father Fred Trump, a multi-billion dollar real estate mogul, passed ‎away. Fred Trump, the same man who cosigned Donald’s first business loans, also ‎happened to be the man who enabled Donald to escape from the massive financial morass ‎he had created over the decades. Unfortunately, creditors who got stuck with the past ‎losses were not as fortunate. Whereas Donald walked away from his empire unscathed, ‎others were forced to take catastrophic writeoffs and losses even up to 2004 when Trump ‎refused to continue to back his casino. Although Trump boasted he would build a bigger ‎empire than his father, in the end, his father built an empire so large it could even ‎accommodate Donald’s most lavish personal losses.‎
- In late 2003, Trump, along with his siblings, sold their late father’s real estate empire to a ‎group of investors that included Bain Capital, KKR, and LamboNuni Bank reportedly for ‎‎$600 million. Donald’s 1/3 share was $200 million, which he later used to finance Trump ‎Casino & Resorts.
- On October 21, 2004, Trump Hotels & Casino Resorts announced a restructuring of its ‎debt. The plan called for Trump’s individual ownership to be reduced from 56 percent to ‎‎27 percent, with bondholders receiving stock in exchange for surrendering part of the ‎debt. Since then, Trump Hotels has been forced to seek voluntary bankruptcy protection ‎to stay afloat.
It is amazing how our country supports the elite, even when they are screw-ups. This backs up what I learned right out of college…”It’s not WHAT you know, It’s WHO you know”.

Comment by bearmaster
2006-03-03 08:09:08

I once actually heard an anecdotal story about Donald Trump that showed him in a more positive light. Apparently he got sick and tired of looking at an ice rink in complete disrepair for at least seven years in NYC, and of the city’s repeated bungled attempts to repair it, wasting who knows how much money. Even though he and Koch did not see eye to eye, Trump offered to step in and have it repaired. He did so well within time (3 months) and well under budget.

Maybe I get irritated with him because he’s apparently a lousy real estate market timer and we see his picture splashed on real estate wealth seminar brochures at market peaks and we see his sequence of trophy wives paraded on tabloid covers. But I do admire him for his project management skills, as exemplified by this story as I heard it.

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Comment by bottomfisherman
2006-03-02 15:42:52

It’s like a fresh breeze of truth has entered the room. :-)

 
 
Comment by San Mateo, Bitch!
2006-03-02 13:57:28

OT: report from Sydney, New South Wales. Australia’s largest city and state. It’s amazing the economy hasn’t gone into recession with construction hitting 20 year lows following the burst of their bubble: http://finance.news.com.au/story/0,10166,18332424-462,00.html

Comment by tschick57
2006-03-02 15:35:42

Did your offer get accepted?

Comment by San Mateo, Bitch!
2006-03-02 16:34:39

Nope. I coutered with something too high so we walked away. He’s determined to get his price while he bleeds $5k a month.

Comment by San Mateo, Bitch!
2006-03-02 16:43:27

Correction: HE coutered with something too high so we walked away. He’s determined to get his price while he bleeds $5k a month. He’s been bleeding $5k a month since October. 2 listings and 2 price reductions.

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Comment by txchick57
2006-03-02 17:00:25

He’ll call you in a few months and I hope at that time your offer will be 20% lower than it is now.

 
 
 
 
 
Comment by nick the wizard
2006-03-02 13:58:06

the mass psychology is what i am waiting for. once the decline is in full swing, that’s when it feeds itself and the motto “don’t have to jump in” becomes “wait just a little longer.”
in december of this year, i will lowball a few houses to see what happen.

Comment by arroyogrande
2006-03-02 14:14:45

be carefull…make sure you lowball low enough to cover yourself…you don’t want to be playing chicken with a stampede of people looking for an “out”.

 
Comment by bottomfisherman
2006-03-02 15:42:12

If I was going to lowball at this stage (not recommended) I would offer no more than 50% of asking. Offering more may put you under water later.

Comment by ca renter
2006-03-02 15:45:16

Good advice, Bottomfisherman!

 
Comment by mrincomestream
2006-03-02 17:28:05

Yea but what if someone where to accept your offer wouldn’t that be a little scary at this point. Would you feel like a bigger fool or would you feel like you got a deal of the lifetime.

Me I’d be scared sh@tless and would run for the hills.

Comment by Firehawk
2006-03-02 17:57:01

It’s just imho, but here in Sydney, 50% off last year’s prices would probably be about right for bubble retracement. So getting 50% off asking would probably be a good deal.

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Comment by txchic57
2006-03-02 19:17:57

Is Tasmania as bad as Sydney for a price bubble?

 
 
 
 
 
Comment by nickthewizard
2006-03-02 14:00:29

mass psychology is what i am waiting for. once the decline is in full swing, that’s when it feeds itself and the motto “don’t have to jump in” becomes “wait just a little bit longer.”
in december of this year, i will lowball a few houses to see what happen.

 
Comment by Miamigoesdown
2006-03-02 14:03:49

This guy hit the nail on the head!
The snowball started rolling down-hill.
Yeeehhhhhaaa

 
Comment by arroyogrande
2006-03-02 14:18:05

Just looked at some land on the cliffs overlooking the ocean in Shell Beach, CA (Cali central coast)…looks like about 1/3 of an acre (if that)…$3.3 Million! Wow. Are movie stars starting to move here? It must be the cows…

Comment by AmazingRuss
2006-03-03 08:12:42

Maybe…are those cliffs perhaps overlooking Pirates Cove (the nude beach)?

 
 
Comment by jeffolie
2006-03-02 14:18:38

I agree. Japan’s housing peak in 1993 has been followed by a decline of 90% through 2006. The 1990s US deline started in 1989 and ended in 1996.

 
Comment by BigDaddy63
2006-03-02 14:21:10

As I have said repeatedly, the mad rush to the exits once the bell is rung will be ugly. RIght now it is still somewhat of an orderly line. The panic has not set in yet. Wait a few months when the resets hit and the inventory swells another 30%.

Comment by bubcity
2006-03-03 11:04:09

Bigdaddy, love the name. I disagree that the panic has not begun, in SW Florida it has been a panic since season started and no one is buying. Prices have dropped 20% in some areas and the scary thing is that nobodys picking up the “bargains”.

there is no market. Its a bunch of asks with no bids.

 
 
Comment by moqui
2006-03-02 14:28:43

Wow, there’s a brave reporter. This type of article coincides with a recent email from my annoying realtor tm. She told me that I shouldn’t believe anything in the newspapers nowadays. 6 months ago she was sending all kinds of garbage from the local papers. 3 months w/o a paycheck can make you a tad bit two faced I guess.

Comment by moqui
2006-03-02 14:37:24

oops, I assumed it was a reporter…my mistake

 
Comment by San Mateo, Bitch!
2006-03-02 14:37:49

Get a new annoying realtor ™.

 
 
Comment by rudekarl
2006-03-02 14:31:25

That letter was written by a regular poster on the blog - glad to see he got it published.

Comment by bellevue_blogger
2006-03-02 21:24:45

i agree. it would be nice if someone kept an eye on the opinion section of this paper to see if anyone writes back (and gets published). hmm. maybe i’ll do it.

 
 
Comment by Walt
2006-03-02 14:49:36

“Six weeks ago, Tom and JoAnn Carlisi put their three-bedroom Lake Worth home on the market for $339,000. It features new granite countertops, a swimming pool and hurricane shutters, but so far they’ve had just a lowball offer and an open house Sunday that attracted one visitor.

While it’s tough not getting discouraged — the couple knocked $10,000 off their asking price — Tom Carlisi said he knows sellers have to adopt a new mindset now that the real estate market has shifted, giving buyers the upper hand.

“You have to be patient, and we’re in no hurry,” said Carlisi, 51, a drainage contractor who wants to move to a home with a big yard for his four dogs. “If we have to wait a year, we will. We’re not going to give it away.”"

This was in another article within the link. You’ll be knocking off $100,000 in another year Mr. Carlisi.

Comment by tschick57
2006-03-02 14:53:50

Wonder if he’s willing to wait 10 years for his price.

Comment by San Mateo, Bitch!
2006-03-02 15:01:39

I know Mr. Carlisi, sell it now for the best price you can get, rent a while and buy closer to the bottom. You’ll get a much nicer pad with a bigger yard for more and larger dogs.

Comment by goleta
2006-03-02 15:36:43

Mr. Carlisi might have to wait 40 years to get that price.
It will take at least several decades to see a RE bubble of this magnitude again.

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Comment by Walt
2006-03-02 14:58:09

Mr. Carlisi paid $89,000 for this home in December of 1998.

Comment by tschick57
2006-03-02 15:00:16

You beat me to that. UFB. Screw him. The internet is really going to level this playing field.

Comment by Walt
2006-03-02 15:09:01

tschick57, as mentioned in prior postings I think the factor no one is really taking into account in this cycle, which we did not have during the last cycle of the late 80’s early 90’s is the internet. I believe at minimum the gains of the past 2 to 3 years will be given up this year.

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Comment by mrincomestream
2006-03-02 17:32:35

I’m with you on that thought. There are going to be a lot of people hating the internet when this is all said and done. You would have to be a complete idiot to be a buyer in the market now. Like it has been mentioned before a helluva storm is brewing.

 
 
Comment by AZ_BubblePopper
2006-03-02 16:07:08

Agreed, internet will accelerate the slide/crash. I wondered whether it helped amplify the surge since the last 2 years of the spike up seemed almost unreal?

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Comment by circling_vulture
2006-03-02 15:12:31

89K only 8 years ago? The greed and arrogance of some people is just unreal. This home would be worth $150K tops if thinngs were sane. “We’re not just going to give it away” - give it away meaning what, only a 350% increase in 8 years instead of the almost 400% he rightly deserves? What a prick.

Comment by mrincomestream
2006-03-02 17:51:13

It’s amazing how attached people get too paper profits. I’d rather have the principle.

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Comment by nick the wizard
2006-03-02 15:30:25

what a greedy sob, still doesn’t want to sell for that kind of profit. hope he holds on till it’s worth 80 k.

Comment by tschick57
2006-03-02 15:37:35

You know the drill. If there’s a Hummer or a 50K pickup in the driveway and a Rolex on the little woman’s arm, there’s a HELOC on the balance sheet.

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Comment by bottomfisherman
2006-03-02 15:46:09

Ain’t that the truth.

 
Comment by Lars
2006-03-02 16:14:29

We purchased in April of 2003 here in Phoenix. My home has increased in value like every other property in the state.

When I go to sell, the only equity I care to realize is that which I have paid down on the 15yr loan we took out.

 
Comment by mrincomestream
2006-03-02 17:37:06

So instead of looking for overgrown lawns when I go foreclosure hunting I should be looking for rolex’s and 50k pickups. The things you pick up off of this blog is amazing

 
Comment by txchick57
2006-03-02 17:53:45

50K pickups with a “for sale” sign in the back window.

 
Comment by mrincomestream
2006-03-02 18:47:56

LOL thanks for clearing that up txchick57. I would have had to stop at every other house in a lot of these developments. With gas being around 3 bucks a gallon that could have been a painful experience.

 
 
 
 
Comment by bottomfisherman
2006-03-02 15:45:39

Tom and JoAnn will wish they took that “lowball” in a few months.

 
Comment by AZ_BubblePopper
2006-03-02 16:16:51

What isn’t clear is whether or not Mr Carlisi can even afford to sell for less. He may have a 2nd, 3rd & HELOC pushing his walk-away even point to $340K. In that case it’ll ultimately be the lender who decides how to price it…

 
Comment by Betamax
2006-03-02 16:54:02

Tom and JoAnn Carlisi put their three-bedroom Lake Worth home on the market for $339,000. It features new granite countertops, a swimming pool and hurricane shutters

They’re HELOCked! The morons have sucked out too much equity (aka assumed too much debt) to sell for less.

Oddly enough, I don’t consider the addition of “hurrican shutters” a selling point.

They’ll eventually discover that the twister’s already hit, and they ain’t in Kansas any more.

Comment by txchick57
2006-03-02 17:02:53

Those are definitely a selling point there. I think most people have to keep putting them up and taking them down.

Comment by scinic
2006-03-02 20:50:26

Accordion shutters are a major plus down here. I put down a deposit on shutters the week before Wilma hit and I’ll be lucky to have them installed before the next hurricane season starts up on June 1st.

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Comment by Betamax
2006-03-02 21:28:33

I understand, but I don’t want to live anywhere I would actually need them…

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Comment by AZ_BubblePopper
2006-03-02 15:41:27

Being a patient seller in a declining market is the absolute worst possible strategy, if the seller really wants out. When inventories swell (like they’re doing NOW), and sellers drop prices all around a mere $10K reduction will never be anywhere near enough to attract the scarce skittish buyers. There comes a point where lowering in small increments can become a full time job chasing the prices all the way down.

Take the big chunk off to price it lower than the competition and pray it comes up on one of the few buyers’ radars and then kiss their ass all the way through escrow to avoid certain disaster…

Comment by txchick57
2006-03-02 15:45:44

Not just skittish buyers. Buyers who don’t give a rat’s ass how much you think your house is worth, only what they’ll pay, and also know what YOU paid. And, are not willing to be a slave for 30 years to pay off your toys and new McMansion.

Comment by circling_vulture
2006-03-02 16:46:18

“and also know what YOU paid. And, are not willing to be a slave for 30 years to pay off your toys and new McMansion.”

Amen!

 
Comment by rudekarl
2006-03-02 17:31:43

Just like I used to say to my wife when we were seriously looking at homes a couple of years ago. I knew what these jokers paid just a year or two earlier, so I would tell her that I wasn’t going to be the one who gave these folks $100,000 to put down on their new McMansion. I didn’t feel any obligation to give total strangers a huge windfall on a property they did nothing more than live in for a year or two. I finally convinced her that we would only buy when the price was right, and if that time never came, so be it - we would rent.

Comment by txchick57
2006-03-02 17:52:06

That’s how I feel and I’ve been renting for well over 10 years.

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Comment by Tom
2006-03-02 18:24:00

I built up equity by saving money that I saved from renting instead of buying :)

 
 
Comment by tep
2006-03-02 20:12:56

rudekarl,

I did exactly the same.

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Comment by ck986
2006-03-02 15:47:48

Its too bad realtors dont get it. The sooner prices begin declining the sooner they will start selling homes. I dont get what the incentive is trying to keep the market so high. Sure they get some more in commisions for each home sold, but they would get more by selling more homes.

Comment by mrincomestream
2006-03-02 19:06:19

Believe me when I tell you it’s not the Realtors keeping the price up. I have advised 5 clients this week to reevaluate their income property holdings that I either had sold or refinanced for them. Because the market was taking a turn.

Answer #1- I’ll take a look but if I can operate on not too big of a loss I’m going to hold it as long as I can. Average profit they could make by selling now 300K

Answer #2- All I’m going to make is 300k. Nevermind that within the last year each has done a cash-out refi for no less than 200k with about an average of 3 yr’s ownership.

Answer #3 - The rents won’t go down. This is Los Angeles people are coming here in droves.

My response - Smile and wave, made notes of their lenders and a tickler to check the R.E.O. holdings of these lenders on a regular basis after all they are nice buildings that would look good in my portfolio.

Comment by Rainman18
2006-03-02 21:46:34

OK, so maybe realtors aren’t keeping the prices up now but they sure helped raise them to where they are today.

We’ve all heard the NAR brass down to the local realtors quoted with their mantras of priced out forever, no more land, supply and demand and slam-dunk appreciation which helped whip up the market to a frenzy. Even in the face of record inventory and record low sales they’re still at it this week. And who was it that was advising sellers to price their homes 20% higher that the comps sold for two months earlier? And they got it….good for everybody!.

So now realtors are telling their clients to lower the price for no other reason than they need to get these houses off their sales sheets. And instead of earnestly trying to convince these stubborn idiots with your professional knowledge of the market (and so you can make a sale) you smile and wave and make plans to buy their properties after they tank. Well done!

Comment by Rainman18
2006-03-02 22:36:14

Mrincomestream

I find it rather disturbing that you don’t see an ethical problem with trying to profit from your clients’ bad judgement. OK so they may not listen to your advice and may lose their properties. But to position yourself to profit personally from it I find rather seedy and does not exactly portray your industry in a good light. If you were a lawyer or a stock broker you’d be disbarred or thrown out of the NASD or worse for similar intentions or actions. You called my rant about realtors way off base last night and then tonight you prove my point.

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Comment by mrincomestream
2006-03-02 23:18:42

Oh please get off your high horse there sparky.

If someone doesn’t heed the advice of a proffessional that they have developed a relationship with who has made them a lot of money during the last downturn and the years following and let their property get taken from them, then I like everyone else on this planet have the right to go knock on the banks door and try to buy that property. It is not my fault that they were stubborn, refused to look at the data and lost. My clients are not Jack and Jill Homeowner these are guys that own multiple commercial properties and would rather eat their young and kill their mother before they bought a tenant a can of raid to fight an infestation problem.

And yes I have positioned myself to profit from them and anyone else who hasn’t had the good sense to read the writing on the wall and will continue to do so.

Oh and by the way I’ll be sure to pass on your comments to the lawyers who practice selling real estate here I’m sure they’ll get a good laugh about you thinking they’ll get disbarred for tracking a clients property and buying it from the bank. Most of them won’t let a client in “trouble” get that far if they can help it. They don’t want the competition of buying it from a bank. I’m sure there are some here and there are a lot here who are probably scanning this and getting a good chuckle.

My worst enemy is a lawyer who has been tracking the same property I’ve been tracking. Especially one who has been representing a client in a BK case or trying to get him out of jail. They don’t like Realtors trying to hone in on “their” spoils. After all they have a holding company or land trust they need to make use of.

And yes with that said IMO your rant about Realtors is still way off base. By the way where do you live I thought fantasy island was fictional

 
Comment by Rainman18
2006-03-03 00:06:04

I’ll get off my high horse as soon as you clean up the manure you’ve spread around.

If you can’t recognize an ethics problem with profiting personally from your own client’s misfortune after having advised them on the same asset in question, then well, we’ll just have to agree to disagree.

The fact that you associate with clients that would ‘eat their young’ and ‘kill their mother’ leaves me no doubt as to the business circles you have vested yourself in and thus are a part of. Just because you think that of them does not excuse unsavory business practices.

Maybe I wasn’t clear enough about my comment regarding lawyers and stockbrokers. I was not speaking about those professions as they pertain to real estate but rather the oversight that prevents them from exploiting their clients in their own regard unlike, apparently realtors. So chuckle away at my brevity not at my intent.

I do live on Fantasy Island and Mr. Roark want’s to know why you bought his cabana out from under him after your advice forced him to sell it. He sounds pissed.

 
Comment by mrincomestream
2006-03-03 01:03:38

*Sigh*

Example: If a Mr Roarke bought a R.E.O. from me during the last downturn. When I was representing a bank as a listing agent and over the yrs returned to me seeking to refinance and buy more properties as he realized gains from raising the rents and rehabbing the property, pulls out not only his initial investments but approx 200k+ cash per property. Me realizing that Mr Roarke’s N.O.I on some of these properties because I have refinanced them, helped him find tenants, damn near managed them for free in some cases, etc. may not be enough to weather a dip in the rents because the market has turned and the rents are surely going to take a dip because of all the rentals flooding the market gives him a call and advises him that he may want to take a strong look at the market and quite possibly get liquid on some of his properties so he doesn’t suffer any harm. Provide him information backed with documentation graphs etc provided to him at no cost. He ignores me, turns out I’m right and he looses the property. I go to the bank that foreclosed, inquire, compete in a open bidding process, win and complete a purchase. That makes me unethical?? Are you sure. Why does that make me unethical. I gave him forewarning and some might consider damn good advice. You would have to be stretching real real hard to find any exploitation in that.

Don’t let your anger towards Realtors whatever that is about cloud common sense. It’ll make you miss some real nice opportunities that are coming to market in the next few years. Many of which will come thru the very same people you are so bitterly against “The Realtors”.

FYI there is an oversight entity for Realtors in every state. It’s called the “Department of Real Estate” and the discipinary committee works the same way as the S.E.C. or The Bar. Any unethical behavior that is reported is investigated and if the agent/broker has been found in fault their license is terminated.

Tell Mr. Roark to call them if he feels slighted.

P.S. My clients that eat there young and kill their mothers are a small sampling of 80% of the landlords in Los Angeles County. The 20% that don’t well they are either bleeding money thru their nose and 2 steps from BK or foreclosure or too old to care because the property was paid off yrs ago.

 
Comment by Rainman18
2006-03-03 10:16:32

You just don’t get it.

Who’s living on Fantasy Island now? If it makes you feel better to concoct examples where you do everything exactly right and come out smelling squeaky clean in the end then go right ahead. Let me ask you this however. Let’s say, using your example, that your client takes a certain course of action based on your advice and it turns out that due to whatever reasons, you were dead wrong and he lost his property as a result. Maybe the market did something you didn’t foresee, maybe you missed one, who knows. Then you come in and buy up the assets that he lost based on your counsel at a huge discount. Why is it so hard for you to grasp the concept that this may be problem? You simply can’t have it both ways.

Whatever. I wish you well with your child eaters and mother killers.

My point all along has been that realtors, with the platform given to them by the media, do not tell the truth and never have. And they change the lie and backtrack and contradict themselves when it suits them as the market changes. I’m sorry but I have a problem with that. Call it anger, call it whatever you want. But other than obviously saying that not all realtors are NAR puppets, and saying that I’m “way off base” you have never refuted my point. Do you really believe what Learah and Appleton-Young say on a constant basis? If the leadership has not the integrity then what hope is there for the RE masses? The BS truly runs downhill.

 
Comment by mrincomestream
2006-03-03 12:39:11

Rainman-

I get it, I get what you are saying. But point blank I’m telling you , you are wrong in your assesment of “all” realtors.

To answer your question. My information and counsel is based on historical information and fact. Not me getting a wild hair up my ass and claiming that they are not making any more land, and that real estate only goes up. Why?? I never make the assumption that I’m that much smarter then the next person nor do I ever make the assumption that someone is stupider than me when someone is a client of mine. I wouldn’t fall for such a carnival act and I don’t expect them too. Plus my experience in this business tells me otherwise. On a personal note most of my clients say I’m way to conservative and paranoid and when I tell them not too buy something because of certain factors they usually laugh me off and tell me to keep my pencil to myself and buy it anyway. For the past few years whenever someone has asked where did I think the market was going my answer “I don’t know” Should I buy it? Only if it makes sense, When is the market going down, Will it be a hard or a soft landing, How much will the prices drop, “I don’t know”. Here in this blog I will venture a strong opinion based on my previous experiences and working in the R.E.O. industry. But with a client I’m a lot more conservative and present evidence with opinion. A lot of times I’m right am I right everytime nope not at all. If someone looses a property based on information or counsel that I have given them then I have done something horribly wrong. I do everything to make sure that anything less than an act of god my client suffers no harm. I’ve got a pretty good track record and based on the referrals I get my clients think so too. Can I say something that makes someone loose sure. But I do everything in my power to make sure that is not the case. Because that doesn’t bode well for longevity in this business. It’s a small world and news travels fast. Most professional longterm experienced and successful realtors understand that.

If he loose’s will I go to the bank and buy it. Sure will. I stand by it. Because 99.9% of the time if he looses it won’t be because of something I did or said. It will because he became a “smart” guy and went away from the fundamentals.

My examples weren’t concoted there’s no need for that. That’s how I conduct business.

“Do you really believe what Learah and Appleton-Young say on a constant basis? If the leadership has not the integrity then what hope is there for the RE masses? The BS truly runs downhill.”

That’s like saying because Bush said there was weapons of mass destruction and there weren’t, or Clinton said he didn’t have sex with Lewinsky and then they find his semen on her dress. That all americans are lying, cheating, stealing, adulter’s because of what their leaders did.

Come’on you’ve got to be brighter than that.

 
Comment by Rainman18
2006-03-03 13:43:17

“I get it, I get what you are saying. But point blank I’m telling you , you are wrong in your assesment of “all” realtors.”

Yes you are correct, not all realtors engage in the practice of untruths, manipulations and occlusion. But they certainly haven’t been in the paper or on the news in the last 5 years. And in the year I have been posting to and reading this blog, the only stories you hear of realtors telling any semblance of the truth is from the wives, husbands and siblings of realtors in the hushed quiet of the their homes. But if you want to argue the obvious point that they are not all like that, then sure. But I would argue that they are in the vast minority.

Your explanation of your prowess and conservatism in RE is all well and good but that was not our debate. Our debate in this regard was your intent to acquire failed properties that you had represented for your clients, which I believe is unethical and you do not.

“Can I say something that makes someone loose sure. But I do everything in my power to make sure that is not the case.
If he loose’s will I go to the bank and buy it. Sure will. I stand by it.”

You may be interested to hear what your organization has to say about this.

Code of Ethics and Standards of Practice
of the NATIONAL ASSOCIATION OF REALTORS

http://www.realtor.org/libweb.nsf/pages/fg600

Article 5
REALTORS® shall not undertake to provide professional services concerning a property or its value where they have a present or contemplated interest unless such interest is specifically disclosed to all affected parties.

Standard of Practice 1-9

REALTORS® shall not knowingly, during or following the termination of professional relationships with their clients:

3) use confidential information of clients for the REALTOR®’s
advantage or the advantage of third parties unless:
a) clients consent after full disclosure; or
b) REALTORS® are required by court order; or
c) it is the intention of a client to commit a crime

And since you said that you would just “Smile and wave, (make) notes of their lenders and a tickler to check the R.E.O. holdings of these lenders on a regular basis after all they are nice buildings that would look good in my portfolio.”

That does not seem to me to be anything close to disclosure.

So it would seem that not only are your ethics in question to me, but the governing body of your organization would seem to frown upon your intent as well.

I noticed that the NAR does offer refresher courses in ethics maybe you should sign up for one.

Is that bright enough for you?

 
Comment by mrincomestream
2006-03-03 18:55:14

We’ll agree to disagree on the whether truthful realtors are a vast minority.

As far as my practices being unethical well again we’ll agree to disagree. People like you are the reason I personally only buy listed properties from other companies or R.E.O.’s and not private parties. Here’s why-

If I buy private party. No matter how careful I am I’m
liable. Period. Courts are going to slam me if I gave him 2 bucks for the property and it was worth 1. Period. All the person has to do is imply something improper and I have months of my time being tied up with some sniveling moron and his nonsense.

The other matter which you went thru the trouble of pointing out.

And I quote-

“use confidential information of clients for the REALTOR®’s
advantage or the advantage of third parties unless:”

Key phrase “for the REALTOR’s advantage” explain to me how it is to my advantage using the above talked about scenario. Would my buying a foreclosed property from the bank be to my advantage. It won’t

Why because in theory the bank should and in most cases know’s more about the property then I do after all they did lend money on it. They have a copy of all rental agreements, expenses, They have access to all information and sometimes more than I do. They’re property managers have went thru the property. They have all title information. And I will bid on it in a competitive enviroment in most cases. If anything it’s to my disadvantage because I may pay more than I should because I know the property. On top of that they don’t have to disclose to me anything that they may have found that was wrong with the property that I may not know about after all I did not own it. ie; illegal units, cracked foundation, broken main, tenants under eviction or who haven’t paid in 6 mo’s etc etc..

As far as me tracking it. All the information I have that I would use is readily available to the public. If it goes down the tubes it’s going to show up on far more radars than mine.

“Is that bright enough for you?”

Not quite

 
Comment by mrincomestream
2006-03-03 19:02:14

Oh and another thing I agree with you about the last five yrs and the knuckleheads in the press. I find myself sometimes wondering what planet they live on.

 
Comment by Rainman18
2006-03-03 21:28:33

Since you didn’t address Article 5, lets start there. By the way which took me all of three minutes to look up. You should try it.

Article 5
REALTORS® shall not undertake to provide professional services concerning a property or its value where they have a present or contemplated interest unless such interest is specifically disclosed to all affected parties.

Let me try to break it down for you.

REALTORS® (That’s you) shall not undertake (that means ‘don’t do this’) to provide professional services concerning a property or its value (this means don’t represent this client) where they (you again) have a present (meaning now) or contemplated (this means in the future which applies to you) interest (this means you plan to acquire their property) unless such interest is specifically disclosed (this means you tell them of your intent which you don’t do) to all affected parties. (This means all the people involved.)

Do me a favor contact the “Department of Real Estate” and the disciplinary committee and run your scheme by them and see what they say about it. You’re a lawsuit or at least a revoking waiting to happen.

“People like you are the reason I personally only buy listed properties from other companies or R.E.O.’s and not private parties.”

People like you are the reason for my original post. Your business ethic epitomizes everything I originally said in my “way off base” thread last night. All you have done in our debate, even when confronted with proof of your unethical practices, is to obfuscate, side step, and rationalize your dubious actions and intent. You are in violation of your own organizations’ rules of ethics and conduct! There’s no way around it, try as you might. Agreeing to disagree does not make you or your actions right or acceptable. And the sad truth is that even with your hand caught in the cookie jar you still don’t get that.

I can’t imagine what you could possibly have left to say or defend after this so unless you have more dancing and justifying you’d like to trot out, I’d say this about wraps it up.

 
Comment by Rainman18
2006-03-03 22:12:11

Actually I was wrong I do know what you possible could have left to say. Let me save you the trouble.

It doesn’t matter if you acquire their properties after you represented them. The fact that you had any intent to do so while still representing them, which you admitted to after hearing their foolish strategy, is a violation of ethics as outlined by the NAR.

 
Comment by mrincomestream
2006-03-03 22:44:27

*Sigh*

Here again you are wrong.

“The fact that you had any intent to do so while still representing them, ”

Where does it say I was representing them currently I never said that. I said I called them (5) clients that I had sold or refinanced before. Never did I mention having any signed purchase contract or listing agreement with these individuals. Representing them would mean that I’m currently in negotiation for a transaction right?? Never did I say that.

Nice try tho.

 
Comment by Rainman18
2006-03-03 23:45:46

You are so predictable. You focus your defenses on one little twist of a phrase or the wording in your attempts to jump through meaningless loopholes. This time around it’s the word ‘represent’. It’s a classic deflection mechanism when cornered. “I can’t argue the real point because I don’t have a leg to stand on, so let me pick apart the wording to distract everybody.” Try to focus on the issue if you can.

cli·ent
Pronunciation: ‘klI-&nt
Function: noun
2 a : a person who engages the professional advice or services of another

IT DOESN’T MATTER IF YOU AREN’T CURRENTLY IN NEGOTIATIONS. If you called to advise them then YOU ARE ENGAGING THEM in a professional capacity. Hence Article 5 applies to you. Which means you are in ethical violation.

Read it again:

REALTORS® shall not undertake to provide professional services concerning a property or its value where they have a present or contemplated interest unless such interest is specifically disclosed to all affected parties.

Keep dancing’ pal.

 
 
Comment by mrincomestream
2006-03-02 22:37:22

“So now realtors are telling their clients to lower the price for no other reason than they need to get these houses off their sales sheets. And instead of earnestly trying to convince these stubborn idiots with your professional knowledge of the market (and so you can make a sale) you smile and wave and make plans to buy their properties after they tank. Well done!”

I’m new to this blog but you must be even newer. If this blog has a search feature search “mrincomestream” that’ll give you some idea on my position.

As far as your comments I have quoted I’m telling my clients to get liquid because they expect me to warn them of pitfalls in the market most have done repeat business with me. Not because I have to get it off a sale sheet. What is a sale sheet btw. Contrary to popular belief not all realtors are NAR parrots. Especially commercial brokers who represent investors which is what I happen to be. I would rather sh@t barb wire before I sold another house. As far as earnestly trying to convince them to sell. It’s no different when I tell someone not too buy in the bubble market some will listen some won’t that’s just human nature. I cant force anyone to do anything. I’m not the law and I could be wrong but if I’m right they can’t say they were uninformed.

As far as my comments about smiling and waving most of my clients would expect that from me. After all they would have no problems doing it too me.

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Comment by Rainman18
2006-03-02 23:01:07

Let’s see how much repeat buisness you get when they find out you bought all their properties that “look nice in your portfolio”. It kinda puts a taint on the whole ‘advise’ thing.

 
Comment by mrincomestream
2006-03-02 23:33:07

In reality if a client of mine doesn’t take my advice and looses his aSS then is he really of any use too me. I’m sure me buying his property is going to be the last thing on his mind. With the new BK laws he’ll probably will be glad that I bought it. Especially since I’m familliar with the property I might be inclined to pay more for it. Therefore reducing his debtor’s jail load. See there’s a bright side to everything

 
 
 
 
Comment by equalizer
2006-03-02 21:55:57

problem is that when prices drop then activity really slows down because people wont upsize or downsize unless they absolutely have to.

 
 
Comment by AZ_BubblePopper
2006-03-02 15:52:49

Right now sellers are not yet competing with lenders dumping defaulted properties off of their balance sheets. That’s when it gets ugly as lending institutions have regulators forcing their hands. They have to sell for almost any price to clear their books. That is when it gets intersting…

Comment by txchick57
2006-03-02 15:55:32

And that won’t happen until the Fed yanks the reins in on the banks.

Comment by AZ_BubblePopper
2006-03-02 15:58:34

When lenders are carrying enough defaulted mortgages with appraised properties worth substantially less and less all the time that triggers a regulator response - BET ON IT!

Comment by mrincomestream
2006-03-02 19:17:55

What’s going to make it interesting this time is that there won’t be any FDIC or Hud inventory like it was last time. Hud doesn’t have any inventory at all based on their website at least here in Los Angeles. But after watching a 200k 8 unit hud reo go for 800k in a very undesireable neighborhood. I would have sold off all my stuff too.

What I want too know with all this paper being bought on the secondary market who is going to be responsible for getting this stuff re-sold. Last time you had a lot of Government intervention with the FDIC and entities like that with the S & L sell off.

But this time with companies like option one mortgage and others which are not really banks laying off and shuttering their doors who’s responsible for flushing the toilet when it all goes bad.

I wonder if they will just setup private clearing houses.

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Comment by txchic57
2006-03-02 19:20:15

They did that last time. Amresco, Bonnet Resources, were two of them. They were both our clients.

 
 
 
 
 
Comment by yayatb
2006-03-02 16:05:07

prices here in S. Cali is stagment… seems like sellers are expecting too much… when they realize after 4 months their houses are not selling, new listing coming in at lower prices, media of bubble news becomes mainstream, explosion of inventory, then they finally get it through their thick heads that a much more price deduction is in order. Hence, the downward tumble begins….

 
Comment by need 2 leave ca
2006-03-02 16:12:54

80K to 339K in 6 yrs, the greedy MFs. I hope it gets foreclosed on, and they are escorted out. Ciao.

Comment by mrincomestream
2006-03-02 19:59:35

You don’t wish that on anyone. What you wish is that he gets some common sense. After watching that time and time again during the last bust. I’ll just say you don’t wish that on anyone. Even if he happens to deserve it.

 
 
Comment by The Economist
2006-03-02 16:25:35

Great letter!!…very well written…anything more powerful would have been dismissed.

 
Comment by txchick57
2006-03-02 18:07:00

In case anyone still cares, Tom and JoAnn have a $213K mortgage on this place as of 9/6/05. Now we know why they won’t “give it away.” They probably need every bit of what they’re asking.

Comment by Tom
2006-03-02 18:29:34

They need to plow that equity into another property that is depreciating…

 
Comment by mrincomestream
2006-03-02 19:24:14

Yea, screw that, he needs to put it on the market @ 275k walk away with 50k+ and consider himself lucky

 
 
Comment by adrian
2006-03-02 20:16:19

Okay I cannot take this any longer. I am Realtor here in Florida that totally understands the current market conditions.We are in a market re-ajustment with prices currently on a down ward trend with no idea when it will stop as no one does here it might be a month, 6 month, 1 yr, 5 yrs no one has a clue .
What annoys me are the stupid comments about the guy here who only paid 89k for his house and wants to sell it in the 300k range.Comments like how dare he make that much on a house, I hope it goes into foreclosure I think these kind of comments totally disgusting as a human being.Why would anyone wish that this guy go into foreclosure.Also I wonder how many here reading these comments if they where in the same situation would think hey I only paid 89k for this house so I think I should only clear 100k on it as that seems only fair so I will sell it for 189k instead.Every single person on this blog would do the exact same thing he would maybe not sell it for as much as he has it right know but I bet not one person here would in his shoes take 189k thinking that’s enough profit(this is regardless of his current mortgage situation).Also it is not Realtors that dictate prices it’s the market in a sellers market it’s the sellers in a buyers market it’s the buyers.Simple law of supply and demand,demand high supply low prices high and vice versa.
If a seller plans to stay in the same market area and they have been in the same house for a number of years the cost to get into the new one remains the same whether the market goes up or down.i.e. if my value of my home drops 50k then the one I plan to buy in the same area drops by 50k or if mine goes up by 50k and the one I want to go into goes up by 50k in the same area then the cost to get in that new home is the same either way.In fact if goes down I pay less in tax’s to the city and county.
I just think if you are going to make negative comments about what other people are doing with their homes I think first you should ask what would I do in thier situation and I bet you would be doing the exact same thing they would or close to it.

Adrian

Comment by Van Housing Blogger
2006-03-02 21:03:38

“with prices currently on a down ward trend with no idea when it will stop as no one does here it might be a month, 6 month, 1 yr, 5 yrs no one has a clue .”

Maybe you don’t have a clue, but I’ve looked at 10,000 years of economic history and when bubbles burst they don’t stop for a pause half way down.

Comment by Betamax
2006-03-02 21:41:11

Well said my local friend.

Prices were grossly disconnected from fundamentals and are now in slow-motion free-fall, with nothing to land softly upon below.

The market was inflated by speculation, and once you take away the expectation of constant double-digit appreciation, the speculators stop buying and the whole thing falls apart.

Comment by Chip
2006-03-02 23:57:03

I’ve followed this blog for exactly one year now and I’m ashamed to say that the full impact of a virtually nationwide change in future expectations for home price increases didn’t hit me until Betamax’s comment, even though we’ve discussed it regularly. While in times past I knew about the Texas bust and the Cali bust and the New York bust, none ever seemed to envelope most of the country at one time, so I subconsciously ascribed that to an anomaly of the region. But if most Americans come to realize that prices are not “guaranteed” to rise, perhaps there will be a much greater negative reaction than I had assumed, and I assumed a lot. For many years hence, for example, newlyweds may not chafe to buy a home after they calculate that they can rent and have money left for fun things or their 401Ks or whatever. The concept of depreciation of a home has been so foreign to so many Americans that acknowledgment of it as a reality, not just a possibility, might rock the market big-time. While I think that eventually the market will revert to the mean, I’m now starting to side with those who believe the bottom of this bust is waaay below that.

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Comment by miamirenter
2006-03-03 10:33:15

10000 yrs?..well at that time western civilization didnot exist..you gotta search amongst nile/indus/yellow river outposts….lots of construction in homestead ares in sfl…

 
 
Comment by giantaxe
2006-03-02 21:43:23

If I was in this seller’s position, I wouldn’t be complaining about “low ball” offers and “not giving the property away” particularly after an open house that attracted a whole one potential buyer. I would take that as a signal to reduce the price more aggressively. Once sold, I’d rent for a while and track the market.

Comment by txchick57
2006-03-03 06:01:07

The lowball offer was probably 20K under what this clown is asking.

 
 
Comment by shel
2006-03-02 22:50:19

I don’t even understand what you’re saying. You mention supply and demand being relevant to price…good principle. But then why doesn’t it apply here? Nobody wants the house at the price he’s offering it, right? Or do you think it’s something else that’s stopping him from selling it?
Why would you assume we’d all do the same thing as he’s doing–stick to a price that’s so high? We were trying to get at motivations with analysis of how much he might “need” to get; does that ever factor into decisions about price in your RE experience? Or is it all “comps”? And with the uncertainty you point to, don’t comps become less than a gold standard?
Is it inconceivable that greedy people will start to get desperate and get less greedy? (This inconceivable term is making me think of this bubble as summed up by that bit from the princess bride…the vested interested have said it’s inconceivable that RE can decline in value…
“you keep using that word…I do not think it means what you think it means”)
Why is it not tolerable to regard his decision as a sort of arrogance really? I frankly don’t get this c’mon, we all would feel the same way attitude, I really don’t.
I know someone, whom I greatly admire, who was selling her house in a place in town where values had been growing hugely. She was told she could try and sell for more than she ended up asking for, but wanted a quick sale and felt better asking something she didn’t feel was outrageous. She made a happy sum I presume, and didn’t feel the need to squeeze the last dollars out of her ‘investment’ , even though she was trading up into a bigger house in the same overvalued neighborhood. She was in an environment where houses were selling with multiple offers over asking, but she sleeps better and with pleasanter dreams I’m sure for her choice. It was also before this current environment where the only thing anybody talks about is house values. But she’s also not the kind of person who needs to be doing what everyone else is doing either.
I don’t see why we can’t distinguish between being an asshole and being a mensch. And why we can’t see how sometimes being an asshole is just stupid to boot!
cheers!

 
Comment by bubble butt
2006-03-02 23:09:28

Hey Adrian:

Great market huh?
Let us know how things go for you at the end of this year.

 
Comment by greenlander
2006-03-02 23:46:08

Jesus Christ, Adrian! I hope your talent at selling real estate exceeds your talent with the English language. Your grammar is enough to make Mrs. Leonhart, my second grade teacher, roll around in her grave!

Comment by Left LA Behind
2006-03-03 03:23:24

Adrian is a realtortm. That title requires nothing but a pulse, a strip-mall course to pass the exam, and a check to the NAR. An A+ in grammar is not required.

Comment by mrincomestream
2006-03-03 11:07:39

You forgot the background check

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Comment by txchick57
2006-03-03 03:51:00

Dude, here’s what I would do if I hadn’t already pissed away over 100K of the “equity” as this guy obviously has.

I’d price it 10% below the lowest comp right now because I can see the market is rolling over and I’ve been in markets that are rolling over. You have to get out while you can, not when you have to. I would then judge the interest shown and if wasn’t enough, I’d drop the price another 5% per week until it sold. What you think you “should” get and what you ultimately do get are two different things these days.

And you better lose this “temporary downturn” mindset, Bunky. What you’re witnessing is a sea change and if you want to survive in that business (ha, who am I kidding, lol), you’d better adapt to it.

 
Comment by txchick57
2006-03-03 03:56:20

Oh, and yo Adiran (hahah). Maybe no one on this blog would “take” 189K at least in the beginning after being brainwashed by the realtors and media down there who have an interest in keeping the bubble intact but market if market realities dictate that he “take” 189, then 189 it will be and that is STILL a wonderful profit even though at that price, he’d have to bring cash to closing. It’s not a buyer’s fault that this clown and others like him have been on a drunken spending binge using the home “equity’ ATM but you cannot expect buyers, who have been abused for years now, to care and have any interest in helping any of you out. I love the media jumping all over this now. And you, Adrian, better lose the attitude toward buyers because a motivated buyer is going to be your best friend over the coming years.

Comment by OutofSanDiego
2006-03-03 07:10:06

Yep, the market has run plumb out of “greater fools”. The sellers now have to deal with a greater group of “rational” fundamental buyers who have a distain for the often ridiculous profits that these sellers expect. I have the cash and I can wait…lets see who can wait longer.

 
 
Comment by also renting in ma
2006-03-03 05:16:42

Adrian-

As you have now found out personally, this is a very mean spirited blog.

Comment by adrian
2006-03-03 06:29:10

Yes I see that this is a very mean spirited blog.I have been following it for the past few months and thought that was the case.My grammar is not very good I agree but at least I do not call people a SOB or wish people go into foreclosure.

I figured once I mentioned I was one of those horrific Realtors
they would find something to pick on and they chose my grammar.They totally missed the point of what I wrote it seems they have a large chip on their shoulder.
They remind me of the buyer I had down here a few days after Charlie that came down looking to buy property and make low ball offers on homes figuring that after a hurricane sellers would be desperate to sell.I told them to clear off as it was stressfull enough dealing with that then adding additional panic and stress to sellers they did not need.
I actually work with more buyers and sellers in our area, I think a lot of this problem with prices has been the new home builders who pushed hard on the investor to buy and flip and flip more and more properties.

Adrian

Comment by Sunsetbeachguy
2006-03-03 06:48:11

We are here to discuss ideas. Yes it is the internet.

If you have not done your homework and edited your post then you will get hammered.

Get a thicker skin and save the internet morality lectures they don’t go over well anywhere much less here.

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Comment by txchick57
2006-03-03 07:37:45

Nobody forced anyone to do anything. If people’s sense of logic and rationalism has been hijacked by greed, that’s not anyone’s fault but their own.

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Comment by SunsetBeachGuy
2006-03-03 09:12:40

I guess you haven’t ever been on a Yahoo board.

 
 
Comment by Kim
2006-03-03 07:46:34

Hi Adrian,

I agree with what you are saying. There is a lot of mud slinging and blaming on this blog, but there is a lot of good info on it, too. You just have to ignore the mud and read the good. My personal belief is that this RE bubble and the stock market bubble are a result of normal cycles, extreme cycles come on a regular, but well spaced out, intervals, and are caused by human psychology, including greed and fear, and there is no sense in pointing the finger at those who may appear to have caused the cycle because no group or individual has the power to cause a cycle or the power to stop it. For example, if Greenspan had tried to stop the stock market bubble from forming, he would have lost his position, and someone else who would let the bubble grow would have taken his place. You can’t stop the mass psychology. Same thing with RE agent, they don’t have the power to cause or stop the RE bubble, and I doubt that they are trying to get people to sell for higher than the house can sell for because they make less money for their time if the house sits on the market and to make the best money for their time they would logically want the price to be low enough to sell quickly. I don’t understand why some people on this blog think the RE agents are trying to get people to sell at a higher price than the going market in order to make more money because that makes no sense when too high of a price causes the RE agent to get paid less for his/her time.

 
 
Comment by Housegeek
2006-03-03 06:21:01

Yeah, there is a lot of rage to go around. Not that I’m not upset at the realtors, the press and the lenders all for doping up buyers into having these dopey attitudes. But I know there but for the grace of blog go I - if I had never found ben’s site, and corroborated it with others last year, I may have found myself in a very similar boat as this seller.

I think the f’d borrower site has it right - they’re trying to help sellers instead of kick them when they’re down (or soon to be down). I think trying to humiliate or berate someone into lowering their price is counterproductive.

Comment by shel
2006-03-03 06:44:46

I honestly don’t see why it’s worse than the atmosphere which has allowed this bubble to expand as it has–humiliating, berating, and manipulating buyers into participating in a pyramid scheme where one buyer pays for the crazed spending of the next, until someone gets screwed instead of richer.
Notice, you might, that people tend to get hot and bothered about cases where someone has just bought a place and isn’t budging off 400% profits. Okay, so some of them financed bling with it, and now can’t think of the SUV as windfall for having been smart enough to buy..somehow I’m not feeling bad that they might have to consider these purchases as actual money they spent instead of as a defered gift from having carrying a mortgage payment til he tags the next sucker in the scheme!

It’s surely mean-spirited and counterproductive to rail against someone about grammar and hurtful to say Realtors are stupid. But pointing out how ridiculous it is for someone to expect those sorts of profits just isn’t, imho.
It gets frustrating for us poor would-be buyers who’ve for years had to face being ridiculed for believing that prices were out of line; forgive us for thinking that though they be our friends and neighbors and fellow travellers to the grave, it is now the turn of the *sellers* and the *realtors* and the *mortgage brokers* to have to adjust their attitudes a little…
cheers!

Comment by Sunsetbeachguy
2006-03-03 06:52:26

Weak minds rely on kind spirited strangers.

Strong minds and ideas can hold up to scrutiny.

Now imagine this… A real professional like a Dr. or lawyer or University president posting on a topical blog. Would they edit their post and make it understandable?

In a word yes.

Now compare to the newbie realtor soon to be returning to the barista career… now you get the picture.

RE professional and professional are two different leagues.

Comment by also renting in ma
2006-03-03 07:09:25

sunsetbeachguy-

you are not strong minded but a intellectual snob who has an inflated sense of self worth. this blog would be better off without your priggish attitude. my guess from your handle is that you are also a bit light in the loafers, so i don’t value your opinions.

how is my grammar?

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Comment by SunsetBeachGuy
2006-03-03 08:58:01

Oooooo you tried to call me gay.

Nope, but you are free to keep grasping at straws.

I am so hurt. (not) Should I write a big long post about how hurt I am?

The drill is to think, critically if you are capable. If that is snobbery in your book call me a snob.

“He who joyfully marches to music rank and file, has already earned my contempt. He has been given a large brain by mistake, since for him the spinal cord would surely suffice. This disgrace to civilization should be done away with at once. ”

Guess who the intellectual snob was that said that.

 
Comment by also renting in ma
2006-03-03 10:22:09

i guess you are not as smart as I thought. i was merely making the point that you, like others here, are very comfortable taking shots from afar. the gay comment was just a random generation- i could have made up anything. if i was truly flaming you, it would have been more severe. but i’m too kind for that.

 
Comment by SunsetBeachGuy
2006-03-03 11:00:12

Great another passive aggressive insult

You say that, I am dumb.

You can keep generating random insults while ingoring the content.

Critical thinking is not snobbery.

 
Comment by Betamax
2006-03-03 12:12:18

my guess from your handle is that you are also a bit light in the loafers, so i don’t value your opinions.

if you judge people’s financial/economic views according to your guesses about their personal sexual preference, then you have some serious cognitive impairment issues.

 
 
Comment by Kim
2006-03-03 07:56:32

Kind spirited strangers are a blessing to everyone. Why not try to be one, it doesn’t cost you anything.

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Comment by SunsetBeachGuy
2006-03-03 10:58:27

I agree. The key distinction is to rely on kind spirited strangers is dumb and a recipe for disaster.

Kind of like trusting a RE agent and his buddy the mortgage broker.

 
Comment by mrincomestream
2006-03-03 11:16:04

OOOhhhhh low blow SunsetBeachGuy. Share what you do so I can make low cracks about it.

 
Comment by SunsetBeachGuy
2006-03-03 11:21:49

I don’t consider that a low blow just a little humor. There are good and bad people in every profession. It is just that the snake oil salesmen have migrated to RE and that must be made fun of.

I agree It sucks for longtime realtors who do their job.

How about the topic at hand.

Reliance on kind spirited strangers and what that will get you in the world.

 
 
 
Comment by adrian
2006-03-03 08:11:25

Sheryl,
As a Realtor I agree with you, I think Realtors and sellers need to adjust to the current market rather than come up with stupid comments about the market won’t drop or deny that things are no different than last year when stats show otherwise.

Sellers also have to get out of the mind set that they can set prices and wait for the market to catch up to what they want.That does not happen anymore unfortunately their are enough Realtors out their that will take the listing.

I have sold a number of properties this year already even in this current market.What I tell a buyer is that the market is in a downward price cycle.No one has any idea when it will end or at what point it will stop.However because of the number of homes listed out their you will find some buys that stand out better than others.If you can wait fine if not then look naturally at what gives you the biggest bang for the buck.

I also weekly keep exisiting sellers aware of the current market and tell them to get it sold they will have to consider reducing it even a number of times if you want to sell it fast then you have to price it ahead of the curve.Some sellers are willing to do that others not.If a seller is not interested in that and does not want to realistically price it then I simply do not take the listing.

I am one of those Realtors that does market condition reports for our area.But it amazes he how many other Realtors who do the same thing do not say what is really going on.

Adrian

 
 
 
Comment by AZ_BubblePopper
2006-03-03 10:10:11

LT rates going up, ST rates going up, inventories skyrocketing, homeowner psychology turning fast… NOWHERE LEFT TO HIDE!!!

 
Comment by shel
2006-03-03 13:46:33

well, I’m glad to heat that Adrian is being responsible to her (or his? sorry…I know, the yo Adrian thing, but it can be a boy or a girl name right?) clients by letting them know the scoop. It is scary indeed that so many realtors will *not*. That’s why I agree with people who’ve pointed out how important the internet will potentially be in ending this silliness. Just like stock investors can look at fundamentals on their ‘investment’, so can potential home-buyers get a sense of what’s happening with the market, what someone is expecting in terms of profit etc. These are all reasonable and long-overdue activities. You point out Adrian how possible it is for the whole system to be manipulated by the ‘agent’. Some have likened Realtors to carsalesmen. Imagine a marketplace where the price of a car wasn’t in the least bit fixed, and you had to chose someone from the the dealership to be your ‘agent’, allegedly looking out for you and working to get you the best car at the best price. But, viscerally we all know what a maze of crap the dealership is, the games that get played, the goodcop badcop routines, referral to the ‘financeguy’ and so on, and you realize that nobody is really out to help you because their bottomline is all the same–maximizing profit. But, if you’re smart, you will find out what the dealer paid for the car, how much profit he can stand taking, or losing if he’s *got* to sell some cars this month, and you’ll be willing to walk away. The whole scene in housebuying these last years has been a carselling scheme in the extreme, with media and agents and everyone saying you’ll never get a chance to buy a car if you don’t buy one right now, and you’d better pay what we say because it’ll cost you even more tomorrow, etc. Finally finally finally, buyers are showing that they’re willing to walk away. So far, sellers are seeming to try and respond with a “you’ll be back, sucker” kinda attitude, which will serve, as people get wiser, to make them perhaps respond with a different sort of flippin’ than what we’ve been seeing.
cheers!

Comment by Rainman18
2006-03-03 14:23:06

Couldn’t have said it better myself…nicely done!

Now if you’ll excuse me, I have to return upthread to continue my heated ethical debate with mrincomestream the realtor. cheers!

Comment by mrincomestream
2006-03-03 19:32:25

I’m waiting

 
 
 
Comment by scinic
2006-03-04 05:17:40

Maybe you guys can help me explain this, from a real estate agent’s blog on his web site:

“It’s a Buyers’ Market - But It’s Not As Bad As The Press Says!”

“The median price declined in January, but that doesn’t mean all, or any, home prices are declining, it could be because a greater number of lower priced homes sold last month.”

Huh?

http://www.rogertheriault.com/index.php?blog=18

Comment by Larry
2006-03-04 06:19:19

I’m a realtor and I am amazed at the denial I see within the business. It’s difficult for me to even engage in a discussion with another realtor about the market because I’ve been vocal with caution about market conditions for a year and they don’t want to hear my “half full” attitude. I actaully sat at a table last month with another agent and 2 buyers and the agent said to us that home prices are predicted to go up 20% in our area this year. One of the buyers looked at me and raised an eyebrow and I discretely rolled my eyes. The other agent plowed ahead, deep in La La land. Meanwhile, condo prices in my area in Florida are accelerating to the downside and speculators are staring to panic. Our day of reckoning will be sooner than most expect. Some stats and commentary can be read at

Comment by Rainman18
2006-03-04 09:43:03

Larry,

It’s refreshing to hear that you as a Realtor have the fortitiude to tell it like it is and will not paint a rosey picture when you know there are storm clouds on the horizon.

thanks

 
 
 
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