"Look for NAR's advertisement during the weekends of November 3-5 and 10-12 in six leading U.S. newspapers: New York Times, Wall Street Journal, Washington Post, Chicago Tribune, USA Today, and Los Angeles Times.
- Interest rates are low
- A good inventory of homes is available
- Prices have stabilized and are starting to rise
- The future of the housing market and the economy is positive
- Housing is a great investment, with average home valuations increasing 88 percent in the last 10 years
NAR is publicizing this message to the press through news release, media outreach, and selected television interviews.
In January 2007, NAR will take this message to the airwaves with television and radio commercials."
The National Association of Realtors is interested in thier membership and is not there to give prudent advice to potential homebuyers. Don't be fooled by their soft landing talk! In the bubble markets this will be a hard landing!Update: Check out this spoof of the Realtors' Ad and also Big Picture's Excellent Analysis of the Ad.
David,
ReplyDeleteNot a comment on your post but in general. The shear amount I've learned on these blogs has been incredible. About six months ago it was brought up that the bubble might or might not go down nationally. Now? Its going down everywhere due to the end of the credit bubble. (Its not over, its just starting to end.)
These ads cannot stop that. In fact, I hope they produce a cheap little mascot I could collect a la the pets.com sock puppet. :)
Not to mention, starting in 2007? That will be trying to close the barn after the cows got out. By the J6pk will know too many people hurting on their mortgage.
This will be very interesting by 2Q2007.
Neil
NAR is Hoping for a Bumper Crop of Bigger Spring Fools and Planting $40 Million worth of TULIP BULBS !
ReplyDeletePrices have stabilized and are starting to rise
ReplyDeleteHuh? There is no evidence that either of these assertions is true.
It's about time! There are too many chicken littles out there feeding off of mutual unfounded fears! Let's hope this helps them open their eyes to reality!
ReplyDeleteThey're right. It is a great time to sell a home.
ReplyDeleteLet’s all listen to lance. It’s never the wrong time to buy, as long if it’s a home you plan on living in it for the long term?
ReplyDeleteWho cares if your home is worth less than half, 10 yrs from now? Inflation and the economy will always take up the slack...right? Who cares if the majority of the economists believe were in the worst housing slump in history.
We have the Dallas Federal Reserve President saying, as anybody not from the former planet of Pluto knows, the housing market is undergoing a substantial correction and inflicting real costs to millions of homeowners across the country.
Let’s all forget about the cost of the home we purchase and listen to lance. If Lance is not a paid shill, he is certainly a nut case. Do the math people!!!!!!!!!!!!
How can the press eat this dog food and not ask the affordability question, which makes low interest rates irrelevant. The secret about poison loans is out of the bag, but the sideshow continues.
ReplyDeleteLet see:
2001: house for $100,000 at 7.8%
2006: same house for $300,000 at 6.4%
Wow, interest rates are low!
How is the group house living arrangement in Silver Spring going?
ReplyDeleteI have a couple of observations unrelated to the posting, but there don't seem to be any open forum sessions any more, so here goes.
ReplyDelete1) I used to think one strong point of this Blog was the focus on particular properties. I think it would be useful for this to continue on the way down too. Just a suggestion.
2) Observations from my neck of the woods (NoVa, inside the Beltway). I moved in in July. Of the houses in the neighborhood for sale then, about 60% remain for sale today, 20% have been removed from the market without a sale, 10% have been placed on the rental market and 10% have sold. Price reductions remain quite large. One local house sold in 2004 for 850K, Subsequently had nearly 100K of addition work. Was placed on the market Jul06 for 1.4m and has had subsequent incremental 100K reductions. It is now asking 999K. (400K or a 28% reduction is quite significant.)It appears that initially the Realtor (tm) lavished quite a bit of attention on this house. Now, generally nobody comes or goes. I wonder if the declining asking price makes the agents less interested in expending the effort to market this house. It seems like a positive feedback loop, where the less marketing may lead to a longer DOM, leading to further price reduction and thus even less marketing.
Anyway, that is what I see in my area. I'm interested to hear the observation of others.
An interested observer.
Some good advice for propective buyers:
ReplyDeleteBuyers, he said, need to be aware that they are dealing not just with a house but also with a seller wrestling with his ego. Sometimes it might be smarter to let the poor fellow keep his price, but ask for other concessions that might actually be more valuable. A new roof, new appliances or substantial assistance toward the closing costs all have material value, but they allow the seller the dignity of maintaining the price at a level that leaves him standing tall in his neighbors' eyes.
"Haggle less over price and more over other stuff," McCabe said the research indicates. "Change the bargaining so you still get the deal you want."
www.washingtonpost.com/wp-dyn/content/article/2006/11/03/AR2006110300666.html
What BS Propaganda!
ReplyDeleteKeep up the good work exposing this unethical industry.
Lance said...
ReplyDelete“Some good advice for propective buyers:”
Wait a few days and Lance will counter is own argument.
Check out this hilarious spoof of the ad over at keith's blog.
ReplyDeleteDavid,
ReplyDeleteI hope you read this. Gekko on Ben's blog noted that this is the first housing downturn with a national mortgage market.
In other words, it will be the first time that nationally credit will tighten on mortgages based on national risk.
That implies it could get very difficult to get credit soon.
Just a thought...
But I do note that quite a few "bubbleheads" have their savings. So they'll be amoung the few buyers.
As to buying. Not yet. The old buyign advice is that houses are like apples on a tree. Sometimes you need to wait for a home to be ripe. Folks, the apples are just budding. Very bitter... In fact, the trees are too young to produce a decent crop. Wait.
I calculated in my neighborhood that I'd save $400k over five years renting a home over buying. This is taking rents off of a local home rental service (online) and noting that similar homes were going for inflated values. I assumed a 7%/year increase in rent *and* a 7%/year increase in home values. Yes, these are nice homes. :) I'll put my money where my mouth is and rent.
Please set up your own spreadsheet and do your own math. As Warren Buffet noted, there are three kinds of people. Those who can count, and those who cannot. ;)
My powder is dry. I'm curious as to what down payments will be required in two years. Anyone betting on zero down loans? Not me.
Neil
threadkilla said...
ReplyDelete"i can't wait to hear how Lance spins the pain that comes during the course of next year."
He'll being saying "You see children ... there really never was a big, bad wolf coming! It was just a normal down side of the real estate cycle, and you're now further behind then ever having let the smart folks buy what you could have bought had you not been so afraid of your own shadows."
Lance, How much is the NAR paying you per post?
ReplyDeleteLance said...
ReplyDelete“He'll being saying "You see children ... there really never was a big, bad wolf coming! It was just a normal down side of the real estate cycle, and you're now further behind then ever having let the smart folks buy what you could have bought had you not been so afraid of your own shadows."
There you go again Lance, calling for HUGE housing cuts. “A normal down side of the real estate cycle” by historical standards would be a reversion to the mean. Come on, get your story straight.
http://www.bubblepic.com/displayimage.php?album=9&pos=4
robert said:
ReplyDelete"There you go again Lance, calling for HUGE housing cuts. “A normal down side of the real estate cycle” by historical standards would be a reversion to the mean. Come on, get your story straight."
That's right Robert, put words in my mouth again. This is right in line with the way you like to manipulate posters' quotes ... taking sentences out of context and giving the impression that they've said things they haven't.
AS for your "reversion to the mean" ... I think that was discussed prior and it was at that time pointed out to you that your "reversion to the mean" only holds during specific --- and relatively short --- periods of time. IF one were really to look at the "sales value" of a house as a measureable asset akin to a stock (which as you know I've argued against again and again), THEN one would find that more often than not whenever there was a major change going on (such as following the second world war), the "reversion to the mean" theory did NOT hold. So, just keep banking on "the economy" to give you that house you want to so bad, and do nothing on your own to earn it, and yes ... someday you'll get it. And someday, you'll find a pot of gold at the end of a rainbow. Anything is possible if you believe hard enough! Now someone I greatly admire is Va_Investor. Isn't it interesting how Va_Investor who HAS BEEN SUCCESSFUL in the past is (1) continuing to hold all her residential properties (and SHE is an investor who needs to be making money off of these properties unlike a homeowner who can be content with having a home that gives them the shelter and stability and other intangibles that one seeks in life) and (2) SHE and her husband are planning to go out right NOW and buy a multi-million dollar commercial property. Robert, hasn't it ever crossed your mind that following the example of those wh've been successful in the past is a better guarantee of your own success in the future than continuing to follow your own ideas which in the past haven't led you to great success? Just a thought ...
Hmmmm....a big ad campaign in the weeks of NAR's national convention? This is nothing more than NAR's way of telling it's members "Look what we're doing for you in this tough market!"
ReplyDeletefrom the neuro-economist in WaPo:
ReplyDelete"Sometimes it might be smarter to let the poor fellow keep his price, but ask for other concessions that might actually be more valuable."
nope, that's when it's time to step on his throat. it's BUSINESS, nothing personal.
ego/door IMO.
anon said 901 said:
ReplyDelete"nope, that's when it's time to step on his throat. it's BUSINESS, nothing personal."
'cept, you're forgetting that the ultimate decision to "play" is his ... not yours. you don't want to play nice? then fine, you don't get the house ... Someone who has the smarts to play nice does. That's how most of life works if you haven't noticed ... Those who feel a sense of entitlement to something --- anytthing --- are usually their own worst enemies. Afterall, people have choices in life. And why would anyone want to oblige deal with someone with a bad attitude when there are so many people out there with good attitudes to deal with?
Lance said...
ReplyDelete“That's right Robert, put words in my mouth again. This is right in line with the way you like to manipulate posters' quotes ... taking sentences out of context and giving the impression that they've said things they haven't.”
Dates and times are given for your reading pleasure
“AS for your "reversion to the mean" ... I think that was discussed prior and it was at that time pointed out to you that your "reversion to the mean" only holds during specific --- and relatively short --- periods of time.”
So this is not a specific relatively short period of time? Take another look:
http://www.bubblepic.com/displayimage.php?album=9&pos=4
IF one were really to look at the "sales value" of a house as a measureable asset akin to a stock (which as you know I've argued against again and again), THEN one would find that more often than not whenever there was a major change going on (such as following the second world war), the "reversion to the mean" theory did NOT hold.”
I agree, if you bought in 1890, then following WWII you would have finally made a profit.
“ So, just keep banking on "the economy" to give you that house you want to so bad, and do nothing on your own to earn it, and yes ... someday you'll get it.”
Funny you should mention that:
http://www.realestatejournal.com/buysell/mortgages/20061106-ip.html?mod=RSS_Real_Estate_Journal&rejrss=frontpage
“And someday, you'll find a pot of gold at the end of a rainbow. Anything is possible if you believe hard enough!”
And maybe, you’ll finally find a renter for your basement, so you can pay your mortgage. Hey, anything’s possible
“Robert, hasn't it ever crossed your mind that following the example of those wh've been successful in the past is a better guarantee of your own success in the future than continuing to follow your own ideas which in the past haven't led you to great success? Just a thought ...”
Now Lance, don’t get all Carlton Sheets on us now, hold it together man. Those folks that are forclosing, are they “successful”?
Bubble Fans have gotten angrier and angrier at lance as their dire predictions have failed to materialize.
ReplyDeleteI think reversion to the mean could happen in several ways including inflation driving up wages (highly probable in a government town). Also, the bust will not be uniform. High-end McMansions and borderline low-end housing will get hit the hardest. I still think properties are over-valued but I doubt that quality properties will slip much past 2004 prices.
ReplyDeleteNOVA Fence Sitter
There have always been people unwilling to take that risk and people willing to take it. One group is referred to as renters and the other owners. Simple as that.
ReplyDeleteUgh. This statement is so ignorant and oversimplified. Now that you are moving into multimillion dollar commerical properties (heehee), go find a different blog. (BTW - it is hilarious that you are now bailing on residential real estate investments as soon as it is getting interesting, i.e., really profitable.)
"We continue to look for signs that a recovery is imminent but can't yet say that one is in sight," said a statement from company Chairman and CEO Robert Toll.
ReplyDeleteDavid, congratulations on being so visionary. Lance, congratulations for being the comic relief.
ReplyDeleteLance on Nov 5: "You see children ... there really never was a big, bad wolf coming! It was just a normal down side of the real estate cycle, and you're now further behind then ever having let the smart folks buy what you could have bought had you not been so afraid of your own shadows."
Robert Toll on Nov 7: "We continue to look for signs that a recovery is imminent but can't yet say that one is in sight,"
Lance is even more of a nutty true-believer than the housing industry. He's pure comic gold.
I know how Lance feels! There are WAY too many mean people that do not know what they are talking about. I am the Chief Economist of the National Association of Realtors. I use really good mathematiks and I see that real estate is strong, the economy is strong, and you can all get rich if you just stop whining and get into the market! Seriously, time is money and you are here reading and writing posts that are not doing you any good. Think about it...
ReplyDelete