A break from politics for some real estate … August Numbers
Posted on September 5, 2008
Filed Under Portland, Statistics, Selling Real Estate, Buying Real Estate, Real Estate | Leave a Comment
More of the same. Since last year the September numbers started to reflect the credit crunch, beginning next month there should be a less dramatic decrease in sales, but for now it’s still not pretty.
Note Terradatum has changed format somewhat, now offering one year monthly increments and YoY comparisons. The following is for the Portland Metro Area. Click on the image for full PDF:
MEDIAN PRICE
Sold down 6.7%; Pending down 2.2%
Blue is pending; green, sold.
UNIT SALES
Sold down 38.2%, Pending down 13.3% (Both will settle somewhat.)
NEW LISTINGS, EXPIRATIONS
New listings down 30.5%, Expired up 16.3%
MONTH’S SUPPLY OF INVENTORY
9.1, down from 9.4 in July.
All Real Estate is Local.
……..PALIN!!!
Posted on September 2, 2008
Filed Under Palin, Obama, Politics, Diversion | 34 Comments
Fearing that McCain would exercise his ‘maverick’ bona fides by selecting Joe Lieberman as his VP - as the media had insisted - I cheered when he instead picked Alaska Governor Sarah Palin. I’ve withheld comment since I didn’t know her any better than anyone, but since the left is desperately comparing the top of its ticket to the Republican second, two things stand out:
1. She made her way to the top by fighting the corruption in her own party, even taking on the doctor of pork, Senator Ted Stevens. Obama made it to the top by embracing the corrupt Chicago machine, including terrorist William Ayers and felon Tony Rezko.
2. And nothing reveals the character of the two more than these quotes:
We’re proud of Bristol’s decision to have her baby and even prouder to become grandparents. As Bristol faces the responsibilities of adulthood, she knows she has our unconditional love and support. Sarah and Todd Palin
And:
If [my daughters] make a mistake, I don’t want them punished with a baby. Barack Obama
Sarah Palin is emphatically authentic, exactly who Michelle Obama pretended to be in her DNC speech. And it’s driving the left nuts.
I. Just. Love. Her.
UPDATE: Watched her acceptance speech, and have changed my mind.
Now I really love her.
……..Biden???
Posted on August 25, 2008
Filed Under Obama, Politics, Diversion | 4 Comments
It’s been just over fortyeight hours, but it’s already a cliche: So much for change we can believe in.
1. Obama’s early primary force, especially among the young demographic, was the idolatry of those who desperately wanted to believe bumper sticker platitudes coming from the thoroughly charismatic and swaggering candidate. Youth want their own identity, their own separation from previous generations: Obama’s texting, twittering online presence made him one of them, and - recall - item after item talked about his ability to turn out the vote of those who’d previously never cared. They wanted a rock star president.
That support began to ebb when he started to flip positions on key issues and showing himself to be the typical - albeit inept - pol; Zogby had him slipping twelve percent in the 18-29 demographic in late Aug.
Now? Forget it. Hillary might have regenerated enthusiasm; Biden is emphatically old-school. In hoping to get older, blue collar voters back in the Democrat camp; in hoping that Biden’s foreign policy credentials would somehow elevate his own, Obama has sacrificed his most enthusiastic constituency.
2. The problem is he won’t pick up the votes he’s lost. People who want an adult in the white house, who are seriously concerned about foreign policy integrity and at least some substantive governing experience, are going to vote for that in the top of the ticket as opposed to the subordinate.
3. Biden himself is the personification of Congress’ eleven percent approval. He’s absorbed in the first person singular, the type of person who in conversation is never listening to what you’re saying but instead formulating what he’s going to say next to prove how clever he is.
4. And he’s just not that clever.
Conventional wisdom in picking a VP is First, do no harm. Biden is McCain’s dream.
The Potential of PhotoSynth
Posted on August 22, 2008
Filed Under Technology, Marketing, Real Estate | 2 Comments
Every real estate agent gets inundated with calls and emails regarding THE LATEST! in new technology. Most of it is designed to wow the agents - lead generation systems, ‘green’ designations - but has little practical use for buyers or sellers. Occasionally, though, something comes along that’s of real benefit, allowing us to get information into the hands of those we represent and who need it most.
PhotoSynth, introduced yesterday by Microsoft, is an example of the latter.
Briefly, it takes a collection of photos, matches them, then places them in a 3D template, allowing the user to scroll through the set, from wide to close shots. Done properly, a buyer could walk through a house, room by room, exploring not only broad visuals but details.
I stopped by one of my listings yesterday and took about seventy low-res pictures of the kitchen and family room. I didn’t do much planning, didn’t edit any of the photos, and took about five minutes to upload and process them. The somewhat inelegant result is below, but I think the potential comes through.
Lake Oswego: Update
Posted on August 8, 2008
Filed Under Lake Oswego, Statistics, Selling Real Estate, Buying Real Estate, Real Estate | 5 Comments
I came across a home that’s been on the market in Lake Oswego since March ‘07 that just went pending. I wrote here that because of inordinate new construction LO had more inventory than most areas and that prices would have to drop in order to clear it out. This listing started life at ~ $1.5 million; when it went pending list price was ~ $840,000.
But we have a long way to go. This pretty much tells the story:
15.9 Months’ Supply of Inventory. It’s 22.8 months for homes over $750,000.
Median price, sold: Down YoY 18.8%.
Median price, under contract: Down 16.6%
But: Median price, for sale: Down only 2.9%
Unit Sales: Down YoY 48.0%.
Incidentally, the MSI for the other two zip codes - 97202, 97206 - that I wrote about: 5.7 months.
All. Real. Estate. Is. Local.
July PDX numbers: More of the same.
Posted on August 2, 2008
Filed Under Portland, Statistics, Selling Real Estate, Buying Real Estate, Real Estate | 5 Comments
July and August, 2007, were the peak months for Portland Metro median price, both @ $300k. The mortgage crisis hit in late August, so I think by September we’ll see a deceleration of the 35% drops in sales and an acceleration of the drop in median price. But not this month.
Median price: $290k, down 3.3%. Interestingly median price for pending sales is lower: $279,900. That should be reflected in August sales.
Closed sales: Now at 1669 - down 41% - will end up around 1800, down 1000 units, ~ 35%.
Closed volume: Will end up down roughly $400 million YoY.
Months’ Supply of Inventory: Terradatum, 8.7, down slightly from June’s 9.3. RMLS will be in the 9.5 range, even with June.
Total homes for sale at least one day hit a peak at 23,874, up 1.9% from June, but because Expired listings were up 47% and New listings down 13%, the Listings on the last day are down 2.6 % from June, to 18,135.
I’ll post graphs when I get the time.
AREIL.
McCain will be president. He’s the NotObama.
Posted on July 29, 2008
Filed Under Obama, Politics, Diversion | 16 Comments
In the buying and selling of almost anything - certainly homes or shoes - this adage applies: Given adequate function, the fastest selling or the highest volume will be not those that are the most attractive, but rather the least offensive. [Traditional floorplans with beige walls; plain toes in black or brown.]
And that’s how we’re picking the leader of the free world.
For the last eight years the left’s prime paradigm has been “NotBush!”; anything he’s for, the left is against. That was Hillary Clinton’s claim to inevitability, and “NotBush!” was her, and the other eight or nine who ran on the Democrat side, tacit campaign theme.
But Hillary suffers serious negatives herself, and the smooth-talker from Chicago took advantage with a “NotHillary!” theme of his own. It wasn’t until she recovered from the resulting stupor that she crafted a “NotObama!” blitz, by then too late, even though she crushed him in the last month of the campaign.
McCain, meanwhile, won on a more subtle “NotBush!” perception, given his offensiveness to those who at least used to be Bush’s base. The left crossed over in Republican primaries to vote for him, and the day went to those who thought being more like a Democrat was the key to a Republican victory.
So as we enter the last hundred days before the election the left is desperately clinging to the “NotBush!” theme - which isn’t going to stick - and the public is gradually learning, with the curtain stripped away, how very little there is to Barak Obama.
===
Two things are Obama’s undoing: Americans gravitate toward and root for the underdog; and its corollary, Americans hate arrogance and condescension, especially when unaccompanied by merit.
As to the underdog, the pictures, say, from the latest world tour that were supposed to lift Obama to polled heights, had instead a negative effect. People aren’t stupid: they see and hear the fawning media, read about the lopsided coverage, and know without having to be told that the major networks and press are in the tank for an Obama presidency. John McCain gets off the plane in New Hampshire (I believe) to one camera and one reporter. People want fair, and they know it’s not fair. Contrary to popular opinion: Advantage McCain.
Obama’s arrogance has been well chronicled, nowhere better than Charles Krauthammer’s The Audacity of Vanity. I suspect he can’t help it: so surrounded he’s been by Mylie Cyresesque idolatry that he believes in his own anointment. He thought his own presidential seal was a fine idea, that he really will stop the seas from rising, that a few well chosen words would summon world consonance, that flipping on campaign finance (or the war, or guns or whatever) is a consequence not of the flipper in question, but of his audience’s inability to comprehend. Jeremiah Wright could damn America to his heart’s content and Obama stuck by him, but once he insulted Obama - by implying he’s a typical politician - under the bus he went.
There’s nothing in my power of observation that suggests I can see things others can’t. Subtly and not so subtly the elitism is transparent. Advantage McCain.
And merit? Even the left is beginning to voice doubt (I suspect the doubt has existed all along).
Obama’s greatest advantage - perhaps his only strength - is his soaring rhetoric and his ability to soothe and captivate with promises of what he’s going to do.
The problem is he’s never been a position long enough to actually do anything; as soon as he moves in to a new office he applies for a promotion. That saves having to follow through, but the consequence is:
Accomplishments: None.
Advantage McCain.
===
Note I haven’t mentioned policy. I do think the economy in general and real estate in particular will plummet under a high tax/high spend Obama administration - imagine the current mess then add Carteresque interest rates.
But I think that even those who swoon at the thought of a European socialist government are going to think twice about putting someone into office whose sense of entitlement is inversely proportional to his level of achievment.
Obama for president? Not going to happen.
UPDATE:
As if on cue, to healing the planet we can now add this, delivered last night to adoring House Democrats:
Inside, according to a witness, he told the House members, “This is the moment . . . that the world is waiting for,” adding: “I have become a symbol of the possibility of America returning to our best traditions.”
…Right.
“God put us on earth to help each other.” Tony Snow dies at 53.
Posted on July 13, 2008
Filed Under Diversion, Excellence, Relationships | 1 Comment
I love good people. Not just people who are superb at what they do, but people who inspire others to excellence as well. People who, through articulation and example, can better illustrate life’s purpose in, say, twenty seven short video minutes than Nietzsche, Kierkegaard and Hegel managed in serial tomes.
If you have time, watch the whole thing. Taped last August, David Gregory asks exactly the right questions; Snow responds with a depth and honesty that few in public are capable:
RIP.
Portland Metro Housing Affordability
Posted on July 10, 2008
Filed Under Portland, bubbles, Statistics, Selling Real Estate, Buying Real Estate, Real Estate | Leave a Comment
In the interesting but not definitive category:
Each quarter RMLS publishes a little talked about Housing Affordability Index, another due out when they release June numbers in a week or so. It takes into account median family income (via HUD), median home prices and prevailing interest rates; then, assuming 20% down on a thirty year fixed mortgage, calculates the affordable payment for the median income vis a vis the median home price. At 100, according to the theory, the median income family can exactly afford a median priced home.
Here’s the one for the March 08 reporting period:
I’m not sure the formula itself is remarkable; there are simply too many individual variables.
But as with most stats, it’s the trend where correlation can be found.
Note September, 2005 is the last time the index was over 120%. The median price was $249,000, median income $67,900 and a thirty year fixed 5.77%. By November the median was $252,500 and - with the very narrow exception of February, 2006 and April, 2007 - was the last month there’s been a YoY increase in sales.
So I went back and checked history:
The last time we had consistent YoY declines in sales were the last two quarters of 1999 and the first three quarters of 2000, back to back years with aggregate sales declines. The index correlates.
Is it meaningful?
We’ll know when we’re back to 121%.
Portland Housing Blog, PMI, Transparency
Posted on July 5, 2008
Filed Under bubbles, Portland, blogging, Real Estate | 4 Comments
Mainstream media love to denigrate blogs and bloggers for their lack of journalistic integrity and oversight - compared, say, to The Oregonian. But blogs are held accountable by readers and other blogs, and the good ones earn credibility by immediately correcting errors of fact. Thus I trust Glenn Reynolds infinitely more than anything I read in the New York Times or Newsweek.
Two days ago Clint at the Portland Housing Blog - a bubble blog whose denizens measure their success on the failure of others - published excerpts from PMI, an issuer of mortgage insurance. In it PMI ranks the risk that housing prices in given market areas will be lower in two years, 1 the highest risk, 5 the lowest. The list that Clint published correctly had Riverside, CA at the highest - 95.5% - but the Portland Metro area not far behind at 79.7%, still a solid 1 and just ahead of the Phoenix area. That, to me, was insane.
But when I searched, it turns out the real number for Portland is 8.7%, a low risk category 5.
I’ve emailed back and forth with Clint several times and have absolutely no indication that the post was intentionally deceptive. A couple commenters said they’d seen the original and it did say 79.7 - though no one challenged it - and had apparently been corrected. That’s entirely believable; if it had indicated 8.7 from the beginning there’s no way the post would have been written since it wouldn’t have fit the hysterical bubble paradigm.
What bothers me is this: Thirty eight hours after Clint acknowleged the mistake - buried in the middle of 65 comments - the post stands as originally written.
So, Clint, if you’re reading this: You’re a nice guy, but your credibility is at stake. I’d suggest an update.
UPDATE:
As expected, Clint corrected it graciously.
And for the record: people can be on opposite sides of substance and still get along well. Anton Scalia and Ruth Bader Ginsburg are best friends; I’d die for my girls but both will likely vote for Obama.
The glue that holds it all together: Honesty.
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