bubbleinfo.com

A break from the usual grind:

Hat tip to Susie for sending this along, from latimes.com:

Anyone who has ever had a beef with a real estate agent should take a look at the website ReallyRottenRealty.com.  It’s all in fun, but the name suggests what some buyers and sellers believe to be true — that their agents failed to earn their pay for one reason or another.

“Want your home advertised by a professional?” the site asks.

 ”We believe in the three P’s of real estate marketing: put, put and pray. Put a sign in the yard, put it on the multiple listing service, and then pray someone will come along and buy it.”

Bill Petrey of Agent Harvest, the site’s creator and owner of a free agent-finder service that helps buyers and sellers find top producers in the Dallas-Fort Worth area, says other real estate agents have been remarkably restrained in their response to the site. “No one’s tried to shoot me or string me up,” he says.

Judging from the number of sellers and buyers who have used the website to vent, though, maybe agents haven’t barked back because buried in Petrey’s parody is a lot of truth. Among the site’s statistics:

— Longest listing on the market: 2,778 days. That’s seven years.

— Number of listings with no photo: 2,048. If there’s no picture, how are people going to see what the place looks like? The whole idea of listing houses on the Internet is to allow people to search from the comfort of their homes or offices.

— Number of listings with one photo: 2,745. See above.

— Number of agents who claim to be ranked No. 1 in Dallas: 2,320.

“My goal with the site is to poison the well, so to speak; to make people more aware of just how bad a real estate agent can be,” Petrey says. “Consumers need to understand that it’s really worthwhile to look for a good agent, and not let an agent get away with the things they’ve gotten away with in the past.”

Read the rest of this entry »

There are studies of electro-magnetic fields that have been inconclusive, and “the Ghost Meter” is a curious name for scientific device.  But nobody is going to want a green box in their front yard that sounds like this:

From Amazon.com:

The Ghost Meter has been calibrated to ignore the extremely subtle EMF emissions surrounding the human body, yet is still sensitive enough to detect the small, distinct, erratic EMF energy fluctuations frequently found at reputed haunted locations. The Ghost Meter provides three corroborating indicators of EMF emission strength. A needle based display, LED lights, and an adjustable audio signal. The response time of this meter is excellent, easily outperforming more expensive EMF meters. It can also be operated in silent mode so it doesn’t interfere with EVP (Electronic Voice Phenomenon) recordings or distract other investigators during an investigation. Compare the value this meter offers compared to other brands. There is no other offer that comes close to providing these levels of features and performance for the price. You’ve seen television ghost hunters use similar detectors. Now you can get your own and start investigating the unknown.

It was asked yesterday how to go about finding deals like the ones LGS has purchased.

The search is agonizing because you’e looking at all the leftovers that have been picked over by everyone else.  The good ones go quick, and it’s tough to keep your chops up.

Some basic tips:

1.  Narrow down the search to specific areas.  Start small, and be an expert in a couple of areas.

2.  Be on an auto-notification program.  Get an email alert when the hot buys first go on the MLS - if you are dependent on manual searching, other buyers are going to get a head start on you.

3.  Examine the pending and sold listings.  Tracking the actual deals keeps it real. 

4.  Dig through old active listings.  Any seller who has been on the market for more than 30 days hasn’t had many showings lately, and after 90 days it’s a ghost town.  Lowball at will.

5.  See in person as many properties as possible.  Having ample experience is invaluable when the right house comes up, and you have to make quick decisions. 

6.  Win the bidding war.  Multiple offers usually only happen the first week on the market, but they’re also possible after a significant price reduction.  You have no obligation for 17 days, tie up the property and get your answers later.  Clean offers with big deposits and down payments get preference.

7.  Omit the loan contingency.  This is a little risky, but if you are a strong qualifier and get your loan package pre-approved, leaving out the loan contingency can keep you in the running with cash offers.  You still have the appraisal and inspection contingencies to fall back on, if needed.

8.  Include ‘as-is’ verbiage.  The contracts already state that the property is sold “as-is”, but including it again might help in a close race.  Once you inspect the property you might change your mind, but the seller is never obligated to fix anything, anyway.

9.  Determine the ideal occupancy arrangement.  Particularly important on short sales, because it’s the most important ingredient to the sellers.

10.  Run into the sellers.  Say as little as possible, just ask friendly questions and shower with compliments without over-doing it.  A little rapport could make a difference in a close race, or on that last counter-offer.

11.  Rely on your agent.  Good agents have valuable insights.  You might prepare for months or years to find the right house to buy, but when the opportunity comes, you might have to act quickly.  Having expertise available in that moment might make the difference.

From the WSJ/Trulia:

“Why on Earth would you buy down here when you can rent?” asked a friend of mine in Miami Beach not long ago. “Buying is so over.”  He promptly moved to Manhattan for work reasons–and bought a $1 million loft on the Upper West Side.

Note the typical behavior. People want to buy when prices are up, and turn more wary when they’ve collapsed. Logically it makes no sense. Research out Thursday adds some hard numbers.

Real estate website Trulia.com has looked at major real estate markets across the country and asked: Is it cheaper to buy, or to rent?

By Trulia’s math my friend was moving in exactly the wrong direction.

Rent in Manhattan: Home prices there are way too high, says Trulia. (Ditto San Francisco.)

Buy in Miami. And Phoenix. And Las Vegas. And most of the other places that have been flattened by the crash. Homes there are cheap compared to rents.

The cross-over point is about 15 times annual rent, the company believes. In other words, as a rough rule of thumb, homes are probably fairly valued in a city when they cost about 15 times a year’s rent. So, for example, if you’re paying $10,000 a year to rent a place, think twice about buying a home that costs more than $150,000. Dean Baker, economist at the Washington, D.C. think-tank The Center for Economic and Policy Research, came to a similar conclusion in research on the subject in recent years. Fifteen times is the historic average, he said.

So what’s the multiple in New York right now?

About 32 times, says Trulia. The average two-bedroom condo or townhouse in New York city costs about 32 times as much to buy as it does to rent. Other major markets over 20 times include Seattle (24 times), San Francisco (22 times) and Portland, Ore. (22 times).

On the other hand Miami list prices are now about eight times annual rents, says Trulia. Phoenix is about 10 times and Las Vegas about 11.

Trulia’s data need to be taken with some caveats.

Trulia looked at list prices rather than actual transaction prices, so its figures for prices may be too high.

Furthermore drawing the cut-off point at 15 times rents may be on the low side.

Mr. Baker, in conversation yesterday, said that figure assumes that you’re only going to stay in your home for the typical seven years. If you stay a lot longer, he says, the transaction costs of buying and selling become less and less important. That makes owning more attractive.

Nonetheless the Trulia analysis seems directionally correct. Work done by the C.E.P.R. last year came to similar conclusions: Namely that markets like New York and the California coast remained expensive compared to rents, while the hardest hit markets now look cheap.

And Trulia’s research emphasizes two points that are absolutely spot on.

First, homeowners need to look first and hardest at present cashflow. The cult of homeownership made no sense. If renting is much cheaper than buying, think seriously about it.

Second: The markets that have fallen the furthest now look like good places to buy, while those that seem to be “safest” aren’t. As the saying goes: There is no such thing as a “safe” investment, merely one whose risks are not yet apparent. It’s a principle that a lot of people forget time and again.

**************************************************************************************

http://www.trulia.com/blog/rudy_bachraty/2010/06/new_trulia_real_estate_index_rent_vs_buy

San Diego was rated the #8 city on their rent vs. buy list, with a 20 Price-to-Rent ratio.

From their chart:

Price-to-Rent Ratio of 16-20: The total costs of ownership of a home in this city are greater than the costs of renting, but it might still make financial sense depending on the situation.

From our friends at the WSJ:

As we reported recently, people whose mortgage payments are reduced through loan modifications often are still drowning in other types of debt. The loan-mod treatment can be akin to using a small Band-Aid to try to cover up a mortar-sized wound.

We may be relying too heavily on that limited loan-mod cure partly because another more holistic therapy, bankruptcy, is no longer as attractive to the patients.

A recent working paper from Wenli Li of the Federal Reserve Bank of Philadelphia and others tries to measure the degree to which the 2005 reform of U.S. bankruptcy law led to more defaults on home mortgages.

Bankruptcy has always been a way for distressed borrowers to save their homes by allowing them to shed other debts and concentrate their resources on mortgage payments. But the 2005 legislation raised the costs of filing for bankruptcy and decreased the amount of debt that is wiped out. “We argue that an unintended consequence of reform was to cause mortgage defaults to rise,” the paper says.

The paper looks at mortgage loans originated in 2004 and 2005 and concludes that the bankruptcy changes led to an additional 200,000 mortgage defaults per year. The paper doesn’t provide estimates for mortgages originated after 2005.

Of course, sloppy lending standards and crashing home prices would have led to an epidemic of mortgage defaults in any case. Nearly 8 million American households–around 15% of those with mortgages–were behind on their mortgage payments at the end of 2009, according to the Mortgage Bankers Association. But bankruptcy-law changes may have made a terrible situation even worse.

The authors of the paper suggest “rolling back” the cost of filing for bankruptcy to pre-2005 levels.

Here’s another idea: Teach your kids not to gorge on credit when it’s easy to get.

A view of the eastbound 56 freeway, then turn north on I-5 at 5:30 in the afternoon:

We’ve been talking about how the quality of schools are critical to the homebuying equation.  Here are the local public high schools, sorted by their totals of four scores from www.greatschools.net:

While it used to be that Torrey Pines had an edge on others around the county, it is remarkable how similar the scores are among the top five schools. I think you also have to hand it to San Marcos HS for making the strides they’ve made too.

With the scores bunching together, how else do you decide? The greatschools website has remarks from parents and students, but you never know what agenda they might be pushing.

P.S. Catholic schools do the same testing, but refuse to release their scores – but the website has testimonials on CCHS, and not all are flattering.

This simulation is posted on a website opposing I-5 expansion.

The freeway traffic in this area (which has seen marked improvement over the last few months since the last project was completed) deters some people from thinking about living further north.

Could a new interchange help real estate values in Encinitas/Carlsbad?

Find more videos like this on Smart Freeway Planning