Happy Birthday Bubbleinfo!

It was 14 years ago today that I started this blog on an early-Saturday morning using a Squarespace free site with the hope of providing evidence to back up my observations – and advice to clients – that the real estate market was in trouble.

I told Donna that I wanted to get in early before every realtor was doing a blog!

I left comments and links back to the blog on Calculated Risk and Ben’s blog, which were both attracting large audiences who wondered about the direction of real estate.  I did get to meet both Bill (who came to my house) and Ben when he came through Carlsbad had a blog party at Pizza Port.

I agreed with the negative sentiment on real estate blogs – which was odd and unusual because readers had never heard a realtor says things like that before.

The L.A. Times picked up on it, thanks to Marc N., to whom I am eternally grateful. I drove reporter Peter Hong around for a day, and he filed this article on the front page of the L.A. Times on April, 2, 2009:

An excerpt:

Nowadays, Klinge said, his blog gets about 2,000 unique visitors per day. About half his clients now come to him from the blog, Klinge said. He closed 43 house deals last year, he said, down from the 61 sales and purchases he brokered in his peak year of 2004, but enough to keep him in business when many agents have quit.

Lately, his videos have been picked up on Calculated Risk, an influential economics blog whose followers include Nobel laureate Paul Krugman. In one clip, the camera pans across the kitchen of a million-dollar fixer near Interstate 5. He pointedly notes the house’s proximity to the freeway, which he calls the “De-troit river.” There’s mold under the sink and a foot-sized hole in the drywall just above the floor.

“December 2006 this house sold for a million dollars,” he says. “Nineteen hundred square feet, built in ’78, right across the freeway. One million.”

On the off-chance the real estate agent who sold the place is watching, Klinge puts in a request: “I want you to put your mai tai down, go grab your shingle and send it in to the DRE [California Department of Real Estate] right now. You don’t deserve a job,” he says. “Everyone who was on that deal deserves to be fired, even the janitor at the escrow company. This is embarrassing, $1 million. Right now it’s listed at $575,000 and that’s probably optimistic.”

Along with the house wreck videos, the site includes statistics on local home sales totals and price declines. Klinge has skewered brokers on the blog, calling them names like “clown” and “cherry-picking cheerleader” for not admitting that the housing market had tumbled. But he said no one had gotten upset enough to retaliate.

The morning the article was published, my phone started ringing before 7am.  One of the first callers was a producer for ABCNews Nightline, and he wanted to send a reporter to do a piece on the crash.  By now the crash was in full swing, so I agreed.

A very nice reporter named Vicky Mabrey came for a day and a half, and then this 7-minute piece ran on Nightline (after being bumped by the Somali pirates):

Thankfully we had brought on Richard Morgan the same month, and he was instrumental in being to handle the flood of client inquires that followed.

Eventually Ben Bernanke and the Fed manipulated the market forces enough to pull us out of the death spiral well before it should have ended, but I did get in a few more videos before it was over:

This one has 22,000+ views and part of it made it into Giorgio’s movie:

The pot farm was a big favorite, with over 27,000 views (and the only time I dropped a Toker 2 reference):

My old 1966 Chevy truck was a co-star in many videos:

The negativity that ensued was brutal – and not just the nasty remarks on the blog and videos. One guy did videos of my videos, and then him and his cronies bad-mouthed me as a realtor on their youtube site. Another guy was making comments on other blogs in my name, and one agent went to my own clients and bad-mouthed me to their face – and it cost me a $1.5M listing.

But I wouldn’t change a thing – it’s been a blast, and extremely positive otherwise!

Old friend Jeremiah said last week that he misses the old renegade Jim the Realtor, and correctly guessed that today’s overly-sensitive society probably couldn’t handle the truth. I agreed, and said all that is left for me is to be a great realtor and cater to those affluent folks who can participate in this high-level game.

Thank you all for being here!

20-25% appreciation per year – how can that happen?

This was my first stab at blogging on September 24, 2005!

It doesn’t happen all at once, it happens a little bit at a time.  If a homebuyer pays 2% more than the last sale, and that keeps happening every month – BINGO – 24% appreciation per year in that neighborhood.

The reason buyers have been willing to pay a little more than the last sale is because it’s frustrating trying to find a suitable house, and if they find one and have to pay a little more to get it, they will,  just to get it over with.  So the 20-30% appreciation per year the last few years can be explained, but will it continue?

Lately, sellers have gotten too optimistic and have been pricing their houses WAY too high, and buyers have collectively said, “Sorry, I’ll live with my frustration rather than pay that ridiculous price.”

Thus, the inventory of homes for sale has grown – why? – because more sellers are unrealistic about what their home is worth. The sellers that get their price right ARE selling because there are still plenty of buyers who want to buy a good home for an attractive price while rates are around 6%, but they aren’t willing to pay 10-20% more than the last sale.

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