Decoding The Realtor Lexicon
Some reports on what’s happening with realtors. “A record 10,000 Realtors have convened in Washington, D.C., this week to meet with their congressional delegation to discuss top concerns for the real estate industry. Realtors are also asking members of Congress to support the act which would permanently bar big banking conglomerates from entering the real estate business.”
“Realtors are also asking Congress members to defend the tax rules that protect home ownership, especially the mortgage interest deduction. If tax benefits associated with ownership were reduced, NAR said, property values would likely decline.”
“Misrepresentation claims continue to be the largest source of legal troubles for real estate brokers, said Laurie Janik, general counsel for the NAR trade group. Agents and brokers should not make any statements about future market conditions, Janik also said. ‘Don’t say anything like, ‘This well will never run dry.’ It’s a sure recipe for disaster,’ she said.”
The Wall Street Journal does a Q&A. “Question: Why is it so hard to get good data on housing-market prices, especially in major metro areas like Washington, D.C.? Are there no reliable indexes? I disagree that Realtors will help much, even for information on price cuts in your target neighborhood. Most Realtors just want to sell houses, and ‘now’ is always the best time to buy.”
“A: Wouldn’t it be great if you could get all of the information you need to buy and sell your home on one free Web site? Don’t get me wrong, there’s a lot more useful real-estate-listing information floating around in cyberspace than there was even two years ago. But much of it is controlled by Realtors, who, as you have pointed out, seemingly don’t want anything but ‘happy news’ getting out, and don’t really want consumers to be empowered.”
Realtor Magazine has some tips, titled ‘Cooler Market Ushers in Its Own Lexicon.’ “It helps to have a decoder ring when you read today’s real estate ads, newly spruced up to wow buyers in a tightening market. Here are some definitions:”
Old World Elegance. The word luxury is so 2005.
New Price. The seller dropped the asking price, but doesn’t want to put it bluntly.
Price Reduced to Sell: Sometimes the direct approach works.
Intimate: The new euphemism for small.
Grand. It suggests glamorous things like sweeping staircases in duplexes — and sweeping prices to match.
And here are some anonymous comments from the field. “We asked on our blog, ‘How is the housing market in your area?’ and readers were quick to answer. And, alas, the news isn’t good: almost every other answer either contained the phrase ‘rising inventory’ or ‘buyer’s market.’”
“One said that Northern Virginia (NOVA) is ‘overflowing’ with inventory. Noting that a lag is expected between rising inventories and price reductions, the poster said, ‘About now is when prices are expected to start downward.’”
“Southeast Pennsylvania is a buyer’s market, ‘for sure,’ according to one reader who said, ‘I’ve seen several ads by agents, ‘Buyers Wanted! Call Us!’ There have been many price reductions, the poster said.”
“In Phoenix, Ariz., ‘inventory is high,’ according to real estate consultant Greg Markov, who pegged Phoenix inventory at 40,000 active listings, compared with less than 12,000 listings a year ago. ‘Suburbs are hurting most,’ Markov said. ‘People are reconsidering driving an hour to work with $3 a gallon gas prices. Sellers are reducing prices an average of 5 to 10 percent to get the properties moving.’”
“California’s real estate market was one of the hottest in the country. But now, according to one poster, it’s a buyer’s market in Marin County in northern California, ‘especially high-end where things are selling 75 percent on the asking dollar. Bad press, high interest rates and rising stock market (are) hurting expensive homes here.’”
“In Phoenix, Ariz., ‘inventory is high,’ according to real estate consultant Greg Markov, who pegged Phoenix inventory at 40,000 active listings, compared with less than 12,000 listings a year ago. ‘Suburbs are hurting most,’ Markov said. ‘People are reconsidering driving an hour to work with $3 a gallon gas prices. Sellers are reducing prices an average of 5 to 10 percent to get the properties moving.’”
3 bed 2 bath 1500 sq ft. 7500 lot, two-car garage, built in 1988-91 in 85205 zip code are still selling in the $235-245,000 range. I’m not sure of much of the area is investor heavy but I continue to check the MLS listings/sales. I’ve told my agent(s) I’ll be interestedwhen prices go below $200,000 but thus far I’ve yet to see much of a price drop. Maybe towards the end of the year.
Yeah, prices are still Waaaay out of line. Maybe by year end they will have to cave in a bit. So far it’s all hot air about price reductions.
Sellers are reducing prices an average of 5 to 10 percent to get the properties moving.’”
Five whole percent?
First the much mentioned ’stand off.’ Then 5%. Then?
One thing I’ve noticed since I started looking at housing is that homeowners feel entitled to any gain and giving that up won’t be a smooth process.
As one of my Realtors warned me, don’t be in love with your house if you’re going to sell it. It’s not that special, it has flaws you don’t seen and there is certainly a better home in the comps that you don’t know about. Getting insulted by offers less than your fantasy price is typical homeowner hubris. People need to look at the transaction as a detached investor, take the money and preserve your gains even if you have to drop the price.
Good point, Mo Money — in the end, many, many transactions fail because ego or emotional attachment (remember “feed the squirrels”?) trump common sense. I loved the place that I sold, but it was the right time to sell and I cut the price ruthlesslessly until it sold. Haven’t looked back. I suppose, ironically, that we will profit from those who do not have the mettle to face the trancactions that way. OK with me.
“I loved the place that I sold, but it was the right time to sell and I cut the price ruthlesslessly until it sold. Haven’t looked back.”
Good advice to hear Chip. I’m sorry if you’ve posted this before but I was wondering what you changed to….rental, smaller home, cheaper market?
Then = Then they ride prices down like every specuvestor has in every bubble in history. Tulips, expedia.com stock, gold, condos in Boise — it’s the same script every time, only played by different actors.
My neighbor is selling his house for $650k — a good $60k over the other three identical homes on the same block. And this is not someone “testing the waters” either, he got a job transfer to San Diego so at some point he’s GOTTA sell. I think he actually believes that he’s playing some genius game of chess. Except he’s playing alone, because his open house this weekend was quieter than the morgue.
Only thing is….. they are still not moving. This is like a clogged drain…it will just gets more and more backed-up until it’s fixed.
Fixed meaning prices are in line with incomes and not anticipated appreciation.
More like a clogged colon…
We’re packing up the war wagon to head to AZ ourselves. Gonna see that bubble up close and personal for once!
Can’t wait to hear your report , it will be interesting .
Former TXchick -
Welcome to AZ. Please don’t lose your edge in the sweltering AZ sun. And yes, asbestos underwear is a good idea.
Re: Packing up the war wagon
Yep, we’re planning to do the same and take a look at the bubble in Marfa, Texas. Totally unbelievable. Photo ops for sure. check out marfa.org
My wife and I have taken several vacations to West Texas / Big Bend, and we’ve stayed in Marfa for a night. I’ve always had the habit of picking up real estate brochures when I visit a town. Anyway, you could pick up houses (shacks) for $15K in Alpine in 2001 (no joke) and for $40K in Marfa. I know that Marfa had a big run-up in prices due to their successful marketing as an artist colony (and promoting the general quirkiness of the place) — But remote doesn’t even begin to describe this region. You’d either have to have your own plane, or be a serious recluse to enjoy the place for more than a few months a year.
FWIW, we did see the Marfa lights.
‘But much of it is controlled by Realtors, who, as you have pointed out, seemingly don’t want anything but ‘happy news’ getting out, and don’t really want consumers to be empowered’
Wow, the WSJ!
The tide is turning. The spin doctors at the NAR, NAHB, etc… are gonna have to work 5 times as hard not to get crushed by the turning sentiment.
Finally someone in the press points at the naked RE emporor, who has been dancing unfettered through the pages of almost every newspaper and airwaves of almost every TV “news” outlet for decades on end. Very nice WSJ is doing its business-savvy readers a service, but the rest of the public has to endure “happy news” every time it opens a newspaper RE section or sees a soundbite.
Makes me think of a good topic for this blog - Let’s all open our local newspapers’ RE sections when they come out this week, and on Sunday we’ll say whether any of them actually had information on the housing bubble, and if they did, whether that info was provided by mouthpieces tied to the RE industry.
I call the NY Times..
If anything good comes out of this, I hope it’s increased regulatory oversight of the RE industry. While I’m typically against bigger government, this is an area where it’s really needed. The housing sector has the potential to drag down the entire economy, and we can’t even get good home price data unless NAR chooses to dole it out to us. We need an SEC for the real estate industry.
Kennebec valley ME market continues to be pretty brisk, though overpriced listings are not selling. Several municipalities have reevaluated properties recently and the tax bills are skyrocketing (26/1000 is a nasty mill rate. This will undoubtedly put pressure on some sellers).
Overall I would say sellers can still exit the market with good prices, but there is a feel in the air that the top may be in even with equity bandits still entering the area.
XC — the real bitch about property taxes:
1. The millage rate matters, but ONLY as a relative number, because it is applied against an assessed valuation that is politically agreed to be a percentage of fair market value — you can rest assured that YOU were not involved in that determination;
2. The assessed valuation (or whatever term is used for the amount against which the millage rate is applied) varies greatly from state to state, and in some states, from county to county;
3. Any caps that are applied, whether to millage rate or valuation and whether relative to age, years of occupancy as principal residence or other, matter a LOT;
4. In many states, including my home state of Florida, MLS listing sheets show the property tax most recently paid by the owner. This almost always gives the out-of-town buyer less than useful information, it is downright misleading. If the seller is not a principal resident AND selling the place for a (choke, gag) low/inflation-only profit, then the stated tax is close to what the buyer will pay. In all other cases (heck, for now just say in all cases), I’d buy a tube of vaseline and smear it on my shades before trying to read those tax numbers, baby, ’cause they shore ain’t what you’re gonna pay.
xc,
I’m sorry to hear that. New England really is a sad state of affairs. NJ/CT/NYC white trash has all but destroyed anything decent here in VT and upstate NY for that matter. But it matters not to them urban slime. They just keep creating the very ugliness they seek to escape from.
> white trash
Could you please avoid that phrase? Let’s discuss housing.
Thanks, Peter
Meh, Vermont is waaay too taxy and pinko. Give it 5 years, your gun laws will fall to the crunchy brigades.
Problems in real estate impacted employment?
http://www.xanga.com/russwinter
Russ, that chart of real estate workers v. factory workers is simply amazing. I have seen that before, but I marvel at the implications of it…thanks…
definition
buyers market- A market with plenty of overpriced homes to choose from with little or no negotiation to be had on price.
New listing I just clicked on - misspellings from agents provide me with no end of amusement
MLS #: RP6054974
REMARKS:
“Cute lake front cootage on two lots in Rappahannock Lakes. .78 of an acre. Wonderful warp around deck over looling lake”
maybe it a cabin for old coots who want to sit on the warp(ed) deck over the (d)rooling lake
Are you being in fun about my English writing? I am honorably in your country and the hard work of my being is only to support my large family. I am sure you are agreeing with this?
I was in Gilroy this past weekend and ran into two Watson RE agents. They were telling me why I should buy: prices will only go up or sideways, you are losing you tax deduction, if you don’t get in now you’ll be priced out, etc. I informed them that (truth) of why I wasn’t buying even though we have a six figure income. I pointed out what was wrong with the information that they were peddling and the gal RE left. The gentleman wasn’t happy but said I wish I was in your position and I told him that it is all about economics and not me wishing him any ill will.I imagine that it will be talked about in a weekly sales meeting and poopooed as someone who just couldn’t afford to get into an inflated market.
why not bet them- that’s what I do- they shut up fast
“California’s real estate market was one of the hottest in the country. But now, according to one poster, it’s a buyer’s market in Marin County in northern California, ‘especially high-end where things are selling 75 percent on the asking dollar. Bad press, high interest rates and rising stock market (are) hurting expensive homes here.’”
“Buyer’s market”? In Marin? Tell me another joke - try sometime between 2009 and 2012.
This sounds more like a “liar’s market” right now - as perhaps there is a lot of “lying” about market conditions in attempts to get houses moving again.
“Buyer’s market”? In Marin? Tell me another joke - try sometime between 2009 and 2012.
Are you saying it’s not a buyer’s market in Marin?
I think he means that it won’t be a true buyer’s market until 2009-12 when we hit bottom; as in, that’s when the smart people buy. Right now it is “a sucker’s market”.
I’m not saying I necessarily agree with that assessment, but judging from what I know of sf_jack based on his posts on my blog, that is probably what he meant. Just my opinion.
Yes - or maybe think of it this way.
It will become a buyer’s market in Marin again when the current 100% “premium” paid on a monthly basis (a mortgage payment vs. a rent payment) declines significantly from where it is now, using traditional financing.
Take your pick on the premium: 10%? 25%? 50%? Wherever it finds equilibrium in Marin.
It is not a buyer’s market at current prices. There will be MORE inventory at LOWER prices. Sucker’s market is right.
Right.
What is the Realtor (TM) lexicon term for “unemployed?”
A Welcome Sales-Free Interlude; as in, “I’m in one of those sales-free periods that give me time to farm listings. Gawd, I don’t know what I’d do without them.”
Realtor.
Renter!
“Up-and-coming Employee.”
Realtor Terms and what they really mean .
“Fixer upper” means “tear down ”
“Great location ” means “overpriced ”
“large bedrooms” means “only one bathroom ”
“cute cottage style” means ” 700 sq. feet ”
“buyers market ” means “excess inventory and the markets toast .”
“sellers market ” means ” More than one greater fool biding on one house .”
“new light fixtures ” means ” the house doesn’t have anything going for it ”
“close to shopping and freeways ” means “at least a 2 hour drive to work . ”
“priced to sell “means “it only needs to come down another 20% .”
“more houses to choose from ” means ” the investors/flippers are bailing ”
“real estate will always go up ” means “, ” what else can I say to get you to buy a overpriced house/condo .”
’security building” means ” not safe to go outside your building ”
“home just need some TLC” means ” only has land value ”
There is alot more terms but you guys just have to learn the language of realtors .
My name is …..Can I take your order?
The downside of the Greenspan Wealth Effect may be higher official inflation. The good news: Once the inventory constipation of homes for sale loosens up, there will be cheap homes to buy or to rent.
——————————————————————————————–
Housing slowdown behind rise in inflation
Perverse methodology could be distorting view of inflation, economists say
By Greg Robb, MarketWatch
Last Update: 4:10 PM ET May 17, 2006
WASHINGTON (MarketWatch) — Beneath the surface of rising core consumer prices over the past two months lies a disturbing trend: The slowing housing market is actually making inflation look worse, economists said.
http://tinyurl.com/e5uwl
The article seems to imply that because the Fed “knows” that the “implied rent” method of calculating the housing compenent of the CPI is a “perverse methodology” they will discount it in determining the actual level of inflation. So…I guess inflation has been understated for the past few years when rents were flat, but now it’s overstated as a result of rising rents? Gee, if we back out energy, food, and housing (or at least discount it’s significance in some way), what the heck is actually being “looked at” by the Fed? The price of a laptop and a cigar?
Lapdance and a cigar more like it.
The FED explained to me that food and energy are volatile so I’m waiting to buy them until they go back down. Makes sense, right?
Buyer’s market? Yeah right? Inventory is at decade highs, but prices are at all-time highs. The law of supply and demand has to come into play eventually. However, you’d never know that in Humboldt California. People seem as anxious as ever to buy that house irregardless of price because real estate only goes up.
At one of the places I was looking at renting, a fairly nice hubby and wife showed me their rental property…a really nice home but a little pricey. The woman stated that they had just bought the house as an investment to go along with the other 4 homes they had in Fortuna. They had just moved to Humboldt from Santa Rosa and felt like Eureka would be retirement haven in future years. They asked me why I wasn’t thinking of buying, and I told them that I felt the housing market was way overpriced and a crash was looming. Both of them became somewhat disturbed and rushed me and my wife out the door. When I called about the rental house the next day, they said it was already rented (even though it had been listed in the paper for more than a month). Hope the flippers get whats coming to them.
They weren’t “renting” they were shopping for lease/buyers. These are people that rent at over market rates and thus lock in a future purchase price in exchange for some break on the price. This scheme used to work in an appreciating market. When you told them you knew prices were falling they knew their high rental price was a “call” you would never exercise.
Exactly Robert. The lease option to buy is a sucker’s bet for the “buyer”. Pay above market rates now for the opportunity to buy the property later at an already locked in and overinflated price.
I agree they were not looking for renters, they were fishing for the next fool to dump their five properties on.
I am seeing “rent to own” ads with increasing frequency on NYC craigslist. Seems to me a sure sign of seller desperation
Good call, Robert. My wife and I have considered renting a lease-option house, in the area where we want to settle, and have assumed your point — we should keep our yaps shut about what we think about the market, because the truth quite likely could cause the rental to be withdrawn from us.
As an aside, I don’t know how rich you are, but I bet you could have been whole lot richer if you’d chosen a different, or at least slightly different, main career. Many of us were bummed when Professor Bear withdrew from the blog, but your insights make up for his. Thx.
Huh? Richer? I’ve got a lovely wife intelligent loving wife, smart, healthy children been to the best schools known great people own my own company and work half the time in my bathrobe. I’m one of the richest men around. Ohh you mean more money, well yes but at what cost? BTW, I’ve been posting a lot because for the last few days I’ve been configuring an OS X Server and “gold” testing a print management program and loading a NAS with 269Gb of iTunes. Yes, getting paid three times over while “frittering” away the hours with the housing bubble. Not that its’ a waste. The people here keep me sharp. Thanks for the kind words. Thank Ben also for putting up with my shortcomings.
Actually what I think you’ve got is a serious load of bullshit and delusions of grandeur.
Thanks for that. Wow, is this a zero sum game? Just like housing it is entirely possible to have win-win conditions. But just like the housing disconnect there are also instances where the facts are ignored because of emotions. Which EXACTlY of the above are delusional? Doesn’t even matter as everyone already knows delusional or not you are in no position to comment competently. EXACTLY like the housing bubble where people let their personal belief systems interfere with their analysis.
Robert, do you live in OC? I think it would be fun to have coffee one day and fritter some more time.
Robert,
I know you are wealthy, and you are not an economist. Count yourself lucky on both accounts
P.S. TxChick, if you take careful note of Robert’s many posts on why Prop. 13 is a great tax law, then it is not hard to draw the conclusion that he is a (wealthy) beneficiary…
a true legend in his own intellect
I am an engineer by training and avocation. I live in the “poor sister” of OC, Ventura County. I have a blog that describes my reasons for many of my positions that don’t belong here. Prop 13 is bad law as are most laws written for populist consumption. I’m not wealthy, I work for a living and have daughters that think the nice ivy covered place we visited in Cambridge last year might be “a nice place to go to college.” I’m constantly amazed at the disconnect between the three tiers; those that play the game, those that don’t know there’s a game and those that make the rules. I don’t say things I know are untrue. I don’t like to talk about mysef except in anecdote, this you read now only because I’m forced by the unfounded accusations. The housing bubble is going to screw millions and personally I resent having to have sold all my investment properties that I would have prefered to keep but I’m not so stupid that I don’t see there is a a financial tide that would be foolish to resist. It takesa lot to annoy me personally but I have little tolerance for topical ignorance. Let’s stop with the personal stuff and get back to sharing what we observe on the topic.
Many of us were bummed when Professor Bear withdrew from the blog
He never left, just changed his name, but if you can’t tell then it doesn’t matter.
They asked me why I wasn’t thinking of buying, and I told them that I felt the housing market was way overpriced and a crash was looming. Both of them became somewhat disturbed and rushed me and my wife out the door. When I called about the rental house the next day, they said it was already rented (even though it had been listed in the paper for more than a month).
WTF??? The mere act of casually mentioning the bubble as your reason for not buying (when asked) caused them to blacklist you? This is beyond stupidity. What should they care what you think anyway? You were looking to rent not buy. Oh, well, I wish them lots ‘o luck on all those “investment” properties.
I’m familiar with that kind of reaction here is San Diego too. Here in SD it’s still socially unacceptable to assert that house prices may decline. The whole housing thing is truely woven into the SD society and culture.
I for one will wear my Scarlet Letters with pride : “HB” (Housing Bear). Hopefully, they won’t try to give me the ‘ol Salem bear-test: Tie suspected housing bear to a rock, then throw in local river or lake. If the accused floats, he’s a bear and should be killed immediately. If he sinks and drowns, then he’s innocent.
What is the Realtor ™ lexicon term for “unemployed?”
The leisure-active?
Recently-licensed CA Realtor (TM)
Decoding the Realtor Lexicon:
Spacious — I’m lying
A steal — I’m lying
Must-see — I’m lying
Motivated Seller — I’m lying
Fixer-upper — I’m lying
You’ve gotta get in before prices rise — I’m lying
You’ve gotta get in before rates rise — I’m lying
There was another bid submitted yesterday — I’m lying
Oh I’m sure you’ll get $100K over the last comp — I’m lying
The market has hit a soft patch — I’m lying
Now that we had the soft landing, appreciation will resume — I’m lying
You’re getting $80K of instant equity — I’m lying
Let the market give you your equity — I’m lying
I’m lying — I’m lying
I’ll swallow your soul and laugh about it with my friends — I’m telling the truth
Just kidding. I think realtors come in good and bad flavors… there are many great ones on this site for example.
What do you call 10,000 realtors at the bottom of the sea?
A good start.
Oh, just substitute realtor for lawyer in every joke you know:
Did you hear scientists have stopped using rats in lavoratory experiments? Now they use Realtors. Three reasons; first there are more of them, second the researchers don’t form emotional attachments to Reaktirs and third it turns out that ethically there are just some things a rat won’t do.
A drop in the bucket..
Supply in Washington DC is growing at a very, very good pace. if a property owner needs to sell he or she is in a position that grow weaker by the day.
http://dcbubble.blogspot.com/2006/05/old-threads-underserved-high-end-condo.html
“Bad press, high interest rates and rising stock market (are) hurting expensive homes here.’”
Wrong.
Logic is hurting the market there.
Damn logic.
RE Lexicon: I still want to know what the heck a ‘Pottery Barn interior’ is.
Generic.
Actually, Pottery Barn makes quite nice stuff, but it’s expensive simplicity, bought for the aura of coolness rather than the utility of the item. I get their catalogs and enjoy browsing them, but their stuff seems kind of… well… blah. Yuppie-clone. Nice but utterly no quirkiness at all.
In other words, someone with no design sense of their own can do quite well with Pottery Barn if they’ve got any money. However, most people did things like buy PB on equity, and now they’ll have to try a different PB… and J.