Jul
1
News Links
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Philly Sheriff Stops Enforcing Foreclosure Notices.
Fairfax County to buy foreclosed homes.
USDA 100% loans for rural properties in Oregon. These include Sherwood, Newberg, Canby, North Plains and others. This program is getting little attention and they are trying to get the word out. When people think of rural areas Sherwood probably doesn’t pop into their mind. Here is a link to local county offices to check on eligibility requirements.
Jun
30
Cars and Homes
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Of course now blue Mazda 3 Hatchbacks will pop up everywhere but for two months there were none around Portland for a reasonable price. She gave a local dealer a chance but he was $4000 higher and seemed to barely hold in a laugh when she said what she would pay. Allison wanted this color and since she kept her previous car for 10 years it made sense to wait and buy what she wanted.
She found the above car on AutoTrader.com in Missoula Montana on Friday. We left at 6 AM on Saturday and she owned it at 5 PM. I had put her Neon on Craigslist in Montana just to see if we could sell it saving a long trip back in two cars. At 10 AM a buyer called about her Neon and he bought it at 6PM. Within an hour we went from having two cars to one car. Craigslist is good for some things but still hasn’t helped me sell a house yet.
In those two months she talked to a private seller in Bend who was overpriced as well. He gave her a little hope that he would drop the price but then played some games and she didn’t hound him like he probably expected. He said he would give her an answer after he checked with some dealers. If he was trying to use strategy it didn’t work.
When I posted the Craigslist ad for her I also checked it for a Mazda 3. Lo and behold there was one 40 minutes outside of Missoula Montana, on the way there! She called and the owner’s husband had taken it to Coos Bay! It would take too long to explain what went wrong here but it didn’t work out. Even though there were health issues pushing the sale of the car, he wasn’t willing to try even a little to make it work. We saw too many things going wrong and one of them did. We were glad we decided to go to Montana and get it from a dealer.
So this got me thinking about real estate of course. Some people are skeptical of FSBO’s. Some buyers feel a sense of legitimacy when an agent’s sign is in the yard. I had a flat fee seller that was going to try to find a house on their own to try to save buyer’s agent commission (this rarely works I hear). After two weeks, they called and asked for help because agents and owners wouldn’t call them back. I wondered if people doubted their interest just because they weren’t with an agent.
The Dealers she had contacted said they would call her if they found her very specific “Blue Mazda 3 Hatchback“. Two of the auto dealers called her Saturday while we were driving and said, “We found you a car!” Brand new sedans, not blue and $5000 more than what she would pay. Really…does this work on anyone but the desperate? I may understand why they called if someone said “I am looking for something with four wheels and four doors.” but she was very specific. Which is how used-car salesman get a bad name.
When I first got into real estate I picked up a buyer because the agent had them fly from Maryland to look at a condo that didn’t accept her two large dogs but had “great window coverings.” Her range was $400,000 to $600,000. I found 4 condos in the $400,000 range and two under that. She told me the previous agent couldn’t find anything under $500,000. Which gives real estate agents a bad name. She bought a condo for $425,000.
But this trip story mostly goes to show my belief that the picky buyer is going to win in this market. Allison was willing to go to Montana for what she wanted. It is easier for buyers to find the “one” home now or even the “two” homes.
The losers, i suspect, will be homes in large developments, or Mcmansions. 100’s of homes with the same floorplan where nothing stands out. Another loser in this market will be people who are wishy-washy. They will drive themselves crazy because they will love 5 homes but can’t pull the trigger because a couple of new homes come up everyday. Then they are heart broken when one of the five sells.
Oh and we saw endangered species. The quickly disappearing Hummer, towing a boat traveling 75+mph. I do love Montana’s speed limit in the fuel efficient Mazda. Then again Allison was paying for the gas.
Jun
27
Numbers and Stuff
Filed Under buying, portland, real estate | Leave a Comment
For awhile I was reporting on the numbers, statistics and prognostications that I found quite often. It is seductive to report the good news about our market. Makes us feel good. But the numbers are interpreted by whoever compiles them and compared to other numbers that someone else put together and there is at least a little bias or expectation by that person. One of the things Freakonomics did was look at research just a little different and see other outcomes, proving that it isn’t so straightforward to predict the future.
When RMLS says that average time on the market is 84 days, do you really believe that on that 84th day you will receive an offer? No. They should include the number of price drops and the percentage off of list price too. But even then it might not show seller concessions because that is private information as deemed by RMLS. So we go back to numbers and interpretations. See where it gets sticky?
The Case-Shiller Index came out and said Portland is up 0.3% March to April according to Ron Ares. We use the numbers of the past to guess the future. Few people do this really well besides Warren Buffet. The experts are really good explaining what happened but even then they disagree. There are even people who believe that the earth is flat.
I also on’t like that NAR and a couple of real estate companies are pushing that this is the “best time to buy a house”. It may be true but it sounds disingenuous coming from them. Even if it was true would you believe a car salesman that said a used car was only driven by a little old lady to church but that she was atheist?
These are historic lows in interest rates and if they rise you might regret it but you can’t time the market. Many people bought in to the market at the top because they felt they were missing out (watching the numbers). Many people are skipping the market so they don’t get trounced (watching the numbers).
If it fits your budget, do it and if it doesn’t, than don’t. In stocks for the typical person is that you add a little every month regardless of the market. You will ultimately buy at some dips and some highs but in the end you average in a good price hence the name “dollar cost averaging”. So buy when it fits right, not just because you are supposed to buy which sounds silly but it happens more than you think.
Jun
27
Free Things To Do This Weekend
Filed Under portland | Leave a Comment
Aroundthesunblog.com is aptly titled for the weekend weather we are going to have.
Here are two events today out of many for the weekend that sound interesting,
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Portland Actors Ensemble will perform Julius Caesar in Washington Park at 7:30 pm. Visit the PAE website for details.
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Environmental Film Event: The film Kilowatt Ours will be showing at Bagdad Theater. Doors open at 5:00 pm, show starts at 6:00 pm. All ages welcome. Visit the Bagdad website for more information.
Get out there and enjoy Portland!
Jun
22
What is Twitter?
Filed Under Uncategorized | 1 Comment
On the left side you will see the heading, “What I am doing now (more or less)”. Twitter is a tool where I can send a text message and it will pop up a on my Twitter page and on the side of my website in an instant. I have been looking at Twitter for a few months now but didn’t know if I had anything interesting to put on there.
Sometimes I have tried to turn a small revelation or idea into a post with mixed results. But when I wrote the small blurb about me using de-mosser on my sidewalk I realized that this is the best use of Twitter.
So I will give tips that I have just learned that aren’t worth an entire post, small bits of new information, if I am out of town or about the cookies that Kathy just dropped off. What I post there will be probably evolve as I feel more comfortable with what should be there. I hope you enjoyed the great weather this weekend.
Jun
20
Weekend Thought To Ponder
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This has nothing to do with real estate but I find this quote from Tiger Woods to be a fascinating. It is so easy to get stuck in a rut and dwell on our mistakes or problems. This quote succinctly puts it all into perspective.
“I view my life in a way … I’ll explain it to you, OK? The greatest thing about tomorrow is, I will be better than I am today. And that’s how I look at my life. I will be better as a golfer, I will be better as a person, I will be better as a father, I will be a better husband, I will be better as a friend. That’s the beauty of tomorrow. There is no such thing as a setback. The lessons I learn today I will apply tomorrow, and I will be better.”
photo via http://www.flickr.com/photos/schumigirl1956/
Jun
20
Housing Starts
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This chart surprised me. It shows that housing starts per million people fell starting in 2005. This information is from US Census Data. Our slowdown came later than others places and luckily we haven’t fallen as hard. Las Vegas started having troubles in 2006 if I recall correctly. One buyer sued the builder because just after he bought the builder dropped prices 25%. Ouch.
With the lowest in housing starts based on population in 50 years this may allow us to recover more quickly. The dips in the 1980’s came after our high interest rates and the other most recent was after the first Gulf War.
Chart via 360data.org
Jun
19
Interest Rates
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For me and some of my colleagues showings have slowed down on our listings. This started in the middle of May. Look at the chart and there is part of the explanation. It doesn’t help that the price of a barrel of oil has done a similar spike.
This reminds me of the Time article talking about prices versus interest rates. They make the point that if prices slide but interest rates go up, then buying now may be better than searching for the “bottom”.
Interest rates were around 9% in the mid-1990’s and 19%+ in the early 1980’s. If interest rates go up then we will see more stagnant pricing around here. As many told me during 2005 and 2006 that they wished they bought before prices went crazy, I expect more to say they wished they had bought when interest rates were low.
Jun
18
Univited Swimmers In Your Pool
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According to this report, some homeowners are finding interlopers in their pool. So far this is a phenomenon in England. As a real estate agent I like the information that I can find online for homes and Google Earth is one of tools I use.
As a homeowner I can imagine that it can be unnerving. If someone wishes to do something illegal. these tools help them as well. For the pool bandits, they can find a pool and plan an escape route. For someone with some more menacing ideas, they can do the same.
I just did a search off Skyline to look for million dollar homes and was distracted by this map image (pic below). I can’t tell if it was put in afterwards, which seems unlikely, or was done by the owner. Interesting. Anyway, like any good intentioned or planned idea, someone can figure out a why to use it nefariously. Just keep that in mind.
Jun
11
Appraisals
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I have complained about appraisers a lot and even a time or two here. Today I listened to a appraiser whom I gained a lot of respect for today. He dispelled some things that I have heard from other appraisers.
Just last week an appraiser told a colleague that he wouldn’t appraise any house above list price and no one else would either. Well that is a lie. I have had two homes go above list price and not for closing costs. Both appraisals came in. Lenders may have their own rules though.
One appraiser said if the price dropped and there was an offer on the home after 24 hours later, he wouldn’t appraise it. The speaker said what I had thought, “The appraiser isn’t appraising anything.” He said it wasn’t a rule and he should still be doing an analysis.
Some other points from the speaker,
- To get comparables outside of one mile he has to give a written reason.
- The same if he goes beyond 6 months and he has gone up to 18 months back.
- Appraisers don’t take tax value into account.
- Short sales are not counted towards comps. (I have heard this from another appraiser) part of the reason is that the house is no longer available. Availability comes into play. This is one reason why I look at what the ACTIVE competition is for a listing.
- An appraiser has to contact at least one party from each comparable he uses. I get these calls often and they will ask the condition and if there were any concessions.
So I gained some respect back for the profession of appraisers. Just like any other field you have some bad ones out there and you just hope you get to work with a good one. With some deals you will have the option of another appraisal but in some of those cases the lender could make it a condition that the second appraisal come in at a certain percentage above the previous one, not just to the agreed upon price.
photo via http://www.flickr.com/photos/orangeacid
