UCLA Anderson Forecast: How Wrong, How Much

[powayseller]

I posted Part 1 of my story on ocrenter’s site last week.

Part 1: Can Home Prices Decline. I won’t copy it here. You can click on the link above to read it.

Watch for upcoming posts:
Part 2: What’s a Bubble
Part 3: What’s different from the last time?
Part 4: How many jobs are we really going to lose?
Part 5: Factors they ignored or misunderstood

If I could be in an office all day working on this story, I would have been long done. My primary responsibility of homemaker, and my kids’ need to use the computer before and after school (no more early morning computer time) have delayed this project.

Rest assured their argument is full of holes, and I will expose it all.

[sdrealtor]

We are waiting with baited breathe

BTW, i’m finally starting to see agents and sellers understand what is happening. Finally! But they are just starting to adjust their expectations and will likely chase it down.

[PD]

I’m wondering why they have ignored so many important factors.

[powayseller]

The most important flaw, and the biggest, and the one that invalidates their entire report, is already written. There is no need for parts 2-4, although I want to expand further.

Any comments on Part 1?

[PD]

I thought that you made excellent points. Historical data is very important when trying to predict the future. However, ignoring new trends (IO financing, etc) that could have a significant impact on future events does not make sense. It does seem very possible that the rash of irresponsible lending is going to have the same effect on many homeowners as losing their job. It all comes down to whether people have enough money to cover their mortgage. It isn’t the cause that important, it the effect that is key.

[barnaby33]

My comment is one based LARenters comment on the other board. The factors we all know are going to lead to the next housing recession are fairly obvious. These guys at UCLA couldn’t have not known that. So what does give? They ignored the biggest factors of all and claimed ignorance when challenged on it, that just smells fishy. I hate fish.

Josh

[sdrealtor]

Here are my general thoughts:

It may sound obvious but prices drop when buyers arent willing or able to pay current asking prices. Right now they are still able due to the creative financing available. What they aren’t in general is willing. All the statistical analysis in the world misses the key driver of sales in real estate…emotion. Right now the emotions are swinging negatively, hence sales are plummneting.

As for the ARM’s, I just dont know how prevalent they are among the at risk population. I beleive they will have an impact, it’s just hard to say how big that impact will be.

One thing that I beleive is greatly overstated has to do with job losses among Realtors. Everyone seems to think that realtors are swimming in dough when that is far from the case. A very few make great money ($250K plus). I’d guess less than 200. I would be very surprised if there are much more than 1,000 or so Realtors in SD County with net incomes over $100K. Personally, I beleive a great deal of Realtors are actually severely under employed. I know I am but have made the choice to be in order to spend more time with my family. The average Realtor is probably generating about $30K to $50K in gross comissions. After giving their broker an average of 40%, paying business expenses, self employment taxes and health insurance most would probably make a better living asking “Would you like fries and a shake with that burger?”

[lostkitty]

Please do not take this the wrong way sdrealtor… but I wonder why you choose anonymity on this blog? I personally liked some of the things you said about yourself and your view of how you help a person choose a home when you first arrived on this blog. I cannot say that i still have that same opinion (you have ticked me off repeatedly since then and freaked me out by looking up powayseller and threatening to reveal her identity), but in all things, I could be wrong – and you just have an abrasive manner.

My point is: here you are on this blog where many people are sitting with loads of cash ready to buy, and you could be cultivating a serious client book if everyone knew who you were and you developed their trust with kindness and a little more delicate choice of words.

When you wrote that about the guy in Minnesota or wherever suddenly telling his wife he’s had it and wont shovel snow another day – well that is me, and someday we will definitely be moving back out there – and all these other people on this blog are also all FUTURE buyers. Why do you choose not to develop this sitting client pool into your own?

[JJGittes]

Lostkitty,

Which sdrealtor post are you referring to? The ones above in this thread by sdrealtor I don’t see anything wrong with. Heck, sdrealtor is one of the very few realtors I have come across that has actually acknowledged the change in the market (sentiment and inventory) and the likelihood of price declines.

On that point, last weekend I had a listing agent on a house I was looking at tell me that the SD market was “really active” and I better submit an offer real quick on her listing, or risk not getting it. Only problem was, the house had been on the market more than 60 days and as of today, still is. If she had sounded more like sdrealtor, or at least not blown smoke, I would have had a lot more respect for her. As it was, I just wanted to get away from her.

[sdrealtor]

I’m here to learn and share not develop clients. I have enough of those and am not one of those greedy money hungry people. My wealth comes from the love of my family. My style is to be off the cuff and if you dont like it, I can live with that.

Furthermore, If I did identify myself I would instantly lose whatever credibility I have in this forum. I would be viewed as a shill, the type that hands you their business card in line at the drycleaner. That just isnt me……

PS I have no idea what you are referring to re: some guy in MInnesota shoveling snow…wrong guy!

[lostkitty]

True – you would appear that way.

[powayseller]

I respect both Bob Casagrand and Jim the realtor, and have invited them to participate in this forum. They have both declined. I would not consider them shills. I think people behave better when not anonymous. I’ve also been curious why sdrealtor doesn’t post his real name, because realtors get business by marketing themselves. Rich has never said that realtors have to be anonymous. I’ve promoted several organizations on this forum, recently even my tenants’ attorney.

[novice1027]

A lot of us are anonymous on this site, why should sdrealtor be any different?
I applaud him/her for not shopping for clients on this site. I would find that most annoying.

[powayseller]

Novice, realtors get their business off the web mainly. Over 80% of buyers find the home they purchase off the web. Realtors who understand this, have a web presence.

Gone are the days of open houses, flyers, etc. That’s the old way. Buyers used to see a realtor to get a printout of homes that matched their criteria. The realtor would drive the buyer around. If the buyer wanted to see the insides of a house, he needed to schedule the viewing with a realtor or go to Open Houses. Today, that buyer previews the houses online.

Today’s buyers go on realtor.com (or similar), search the homes they want, and call the realtor to see the home. Usually they’ve already taken the home video tour, and thrown out many of the candidates. The buyer goes to the realtor with the list of homes he has chosen. The opposite of how it was!

It used to be curb appeal, house appeal.

Now it is internet appeal, curb appeal, house appeal.

When you sell your house, make sure your realtor gives you a NARRATED VIDEO. It must be narrated, to really get the viewer’s attention. Most are so stupid – silent movies! Our audience these days doesn’t want a silent movie. Make sure your realtor does a good writeup with the best photos. The internet marketing is what gets you the showings. I paid scrupulous attention to this when I did my listing. I took many photos over and over, and cropped the images…I reworded the text. Unfortunately, I did not get the video with HelpUSell, but I saved $12K in commissions, and got lots of foot traffic anyway.

I find it interesting that sdrealtor does not have a website, given all the above. I think that realtors benefit by putting their name out in front of as many people as possible, and promoting their presence through the internet. This is proven with the 80% figure cited above.

For example, Jim the realtor and Bob Casagrand are two realtors who have a website. With picture. Rich Toscano has his photo on the Voice column. None of them are anonymous. I don’t see the point of being anonymous.

Perhaps the CEO of World Savings would wish to be anonymous when he comes on here and writes that RE will tank. But for the average person, why hide behind a screen name? No stalker is going to come look you up for your views on real estate!

Novice, I hope I have explained this sufficiently.

[sdrealtor]

UNBELEIVABLE!!!!!!!!….Why don’t you post your REAL NAME here? Until you do, I have nothing to say to you in this regard.

[Author]

Posts