Tuesday, May 27, 2008

Antitrust Settlement Reached

The Feds and the NAR have reached a settlement:

The deal frees Internet brokers and other real-estate agents offering
heavily discounted commissions to operate on a level playing field with
traditional brokers by using the multiple listing services that are the
lifeblood of the industry, government officials said.

Great. But does the settlement really change much? Not really:
After the Justice Department sued the Realtors’ association in 2005, the
group suspended the exclusionary policy.
The NAR's dropped the policy three years ago. Even at that time, their were lots of discount and flat fee brokers out there on the net and even on the local MLS. I don't see how much has changed, atleast here locally.

Maybe now with the current housing downturn coupled with this settlement, we'll see greater price competition between brokers. Commissions have always been negotiable, but maybe now sellers will have more options, and brokers will be more flexible.

As for me, I am my own boss. I have always had flexibility with my commission rates. I'll even do a flat fee if the situation warrants. Just tell me what you need as the seller, and we'll work something out.

Thursday, May 15, 2008

The Great Disappointment?

From the Times (no, the other one) via Instapundit:
I don’t know about you but I feel a bit cheated. There we all were, led to
believe by so many commentators that the sub-prime crisis was going to force the
United States into a new era of dust bowls and breadlines, a slump that would
call into question the very functioning of the capitalist system in the world’s
largest economy. Carried away on the surging wave of their own economically
dubious verbosity, the pundits even speculated that this unavoidable calamity
might presage some 1930s-style global political cataclysm to match.
it’s early days, to be fair, but so far the Great Depression 2008 is shaping up
to be a Great Disappointment. Not so much The Grapes of Wrath as Raisins of Mild
Inconvenience. Last week the Commerce Department reported that the US economy –
battered by the credit crunch, pummelled by a housing market collapse and
generally devastated by the wild stampede of animal spirits – actually grew in
the first three months of the year.
We've been hearing since 2001 that the U.S. has had the worst economy under the Bush Administration since the Great Depression of the 1930's. It's possible that after crying wolf for so long, there may be a wolf loitering about. Or folks are still just crying wolf. It is an election year after all.

Median Income Drops

According to the Sacramento Bee, Sacramento area families are in bad shape:
Adjusting for inflation, the median income of Sacramento County families who filed joint tax returns fell about 1 percent from 2002 to 2006, a showing worse than 51 of the state's 58 counties, according to California Franchise Tax Board figures released this week.
Sounds bad doesn't it?
In the process, the median income of those families fell below the $66,800 statewide median – which rose about 3 percent after inflation during the period – for the first time in at least a decade.
Being the curious type, I went to the FTB site and found the data the Bee used to write their report. I found a few interesting things. In 2002, the median income in Sacramento county for families who filed joint tax returns was $59,716 which ranked Sacramento County at #16 in the State. For 2006, and which the Bee never mentions in the article, the figure is $66,247, just $563 below the state-wide median and a rank of 20th in the state.
In reading the article, I am just not seeing the gloom and doom. Yea, we've fallen a bit behind, but do we really need to be worried about falling slightly under the state median by a mere $563? The data also point to the fact that the large metro areas (SF, LA ) cashed in over the past few years, outpacing the more rural interior portions of the state. And this is surprising to the folks at the Bee because?
Of course, the rural counties that make up the Heartland of California are going to fall behind in income levels. The SF and LA areas are a giant cash vacuums that skew the statewide median. Our incomes will never match theirs and guess what, neither will our cost of living. The Bee should exercise their math muscles a bit more by conducting an evaluation of the county median income adjusted for the cost of living. Then maybe we'll have something usefull.
And just for good measure, the Bee throws in a little class warfare to fit the narrative:
Chris Thornberg, a principal at the Los Angeles consulting firm Beacon Economics, noted that census figures also show that average incomes rose quicker than median incomes. An average – unlike a median – can be greatly affected by families making lots of money.
What you're seeing is a widening of the income distribution," Thornberg said. "The rich are getting richer."
Oh my God! Families are making lots of money. This is a crime against humanity!
Finally,the Bee hits skid row to tug at our heart strings in profiling two down and out business owners: a popcorn vendor, and a mover/cleanup guy. Yep, your typical small business entrepenuers who lost it all.
When my last attempt at a small business dryed up back in 2005, I went and got a job and started planning for the next one. Funny how that works.

Tuesday, March 25, 2008

Good News! Prices Drop

As consumers, Americans rejoice when prices of everyday commodities drop. We welcome price reductions and sales at the supermarket. We gush at the prospect of lower gasoline prices at the pump. We become ecstatic when we find a widescreen HDTV 50% off.

So, why is it we get all glum about lower home prices? Sure, not everyone benefits from lower prices: mainly homeowners looking to leverage their equity or make a quick profit, brokers and agents looking for sweet commission payouts, and your local tax collector. But what about your average homebuyer?

Lower prices allow more people into homes who were previously priced out of the market. Overall, that's a good thing. Combine that with relatively low mortgage rates, and things should be pretty rosy from a buyer's perspective. Privided that they have a good credit rating. If you have lousy credit, pay off some debts and clean up your credit report before trying to buy. If you can't handle your current debt load, there's no way you can handle a $300,000 mortgage on top.

I don't think we've found the bottom of the market just yet. Sellers need to get a dose of reality and price their homes for the current market. Either that or hang on to them until current inventory drops and demand improves. Stop dumping your properties.

It's called supply and demand. Look it up, it's a concept that's been around for a while.

Foreclosure Rescue

Boosting the reputation of Brokers across the nation:
SACRAMENTO, CA - Nineteen people have been indicted in a major mortgage fraud case federal agents call Operation Homewrecker, where at least 115 victims lost their homes as they tried to save them from foreclosure.


From The Big Picture:
One of themes we've looked at over the years is the spin that some trade groups put out on top of their data releases. Some Trade Associations, like the ATA tonnage index, or the Home Builders Index, simply put out the straight dope -- an unvarnished, unblinking look at their industries, so their members can better make informed business decisions with the available data.
Other groups massage the data, spin the message, and try to present their info in the most positive light -- regardless of the underlying data. They seem to believe that if only the public believes things are okay, it will become a self-fulfilling prophecy.

Well knock me over with feather. Who'da thunk it?

H/T Insty, who has more.

Monday, March 24, 2008

Face for Radio

I think it may be time for a new professional photo. This one is so, I don't know, Realtorish:

I'm really not that stuffy. It wouldn't hurt if I actually cracked a smile. Would it be unprofessional to pose in shorts, t-shirt, and a tall cold one by the pool?