Wednesday, April 30, 2008

New week, new open thread

Here you go, another open thread. What's on your mind?

28 comments:

jasper said...

Apparently, there's a new bubble forming! Haha.

http://real-estate.dbusinessnews.com/shownews.php?type_news=latest&newsid=155249

BEAVERTON, Ore. — Is a new real estate bubble forming? Executives at RE/MAX equity group think so. Gary Taylor, principal broker at the firm’s Sunset Corridor office and head of the company’s panel who studied recent market data and the prevailing theory, recently released the panel’s findings.

Local brokers are seeing steady sales through this “new market”. Last month the Portland Metropolitan area had 1,384 closed sales, up 27.6 percent from January 2008 (1). What the brokers are hearing is a real demand from individuals with a sincere desire to buy, but limiting factors are hindering their ability to execute a transaction.

etc..

Benjamin said...

I think we've reached the apex of ridiculous incomprehensibility: http://portland.craigslist.org/mlt/rfs/636037283.html

"Portland is one of only three cities in the United States that still has homes appreciating in value! We're also fortunate enough to have record levels of inventory. If there were ever a time to buy low and sell high, now is the time!"

Everybody wins!

Kirk Coburn said...

Since good jobs help drive an economy and support housing values... Curious what you see are examples of good companies that support our economy. (I.e. Nike, Intel, and others)

Anonymous said...

I just saw a commercial for Arbor Pass by Arbor Custom Homes on TV.

http://www.arborhomes.com/neighborhoods/arbor-pass/overview.php

Starts at $149,000? I haven't looked that closely, but for a two-bedroom located near light rail that actually sounds like they're priced right for this market.

Anonymous said...

i thought things were getting more affordable, but something like this:
http://www.zillow.com/HomeDetails.htm?zprop=53886411

makes me rethink it. 90% appreciation in one year ?!? 10k in monthly payments ?!?

very discouraging.

PDXOutsider said...

"i thought things were getting more affordable, but something like this:
http://www.zillow.com/HomeDetails.htm?zprop=53886411

makes me rethink it. 90% appreciation in one year ?!? 10k in monthly payments ?!?

very discouraging."

unfortunately i can't get that link to work. can you repost, or post the address?

dont' forget asking price does not equal sales price, and there are always bargains to be found especially if you're a flipper with cash on hand.

Anonymous said...

90% appreciation in one year ?!?

Do you know what happened to the place? It looks like it was a Personal Representative Deed sale. Sold out of an estate, usually by a court or other 3rd party person. Houses of this type are usually run down and in such disrepair they need to be gutted.

PDXOutsider said...

ah, i got it to work. 2438 NE 17th, Irvington. Looks like it was flipped, someone finished out the basement and added a media room. I assume they also restored/remuddled the rest of the house.

8 bedrooms, 4.5 baths. I wonder if it will become a bed and breakfast, the new owners don't live in Portland.

Any Realtors know have access to the most recent listing and/or have the scoop?

PDXOutsider said...

"Do you know what happened to the place? It looks like it was a Personal Representative Deed sale. Sold out of an estate, usually by a court or other 3rd party person. Houses of this type are usually run down and in such disrepair they need to be gutted."

I can't believe it would sell for $1M if it needed gutting. But i don't know any more about it. This is when I wish I had access to the RMLS, maybe I'll have to get that license.

Perplexed said...

Here is a link to the permitts issued for that property: http://www.portlandmaps.com/detail.cfm?action=Permits&folder=2664682&propertyid=R188315&state_id=1N1E26DB%20%207400&address_id=602717&intersection_id=&dynamic_point=0&x=7651798&y=690393&place=2438%20NE%2017TH%20AVE&city=PORTLAND&neighborhood=IRVINGTON&seg_id=110895

If that doesn't work link to www.portlandmaps.com and search for the address.

squeezed said...

The new owner is a real estate agent


http://www.windermere.com/index.cfm?fuseaction=agentOffice.agentDetail&AgentMetauser_ID=241268&listingID=19371475

The sale looks weird. Be interesting to see if it goes back on the market or forecloses.

squeezed said...

In portland maps she is listed as residing at 12787 SE EVENING STAR LN, Happy Valley

Interestingly, this is one of her current listings. I wonder how many other homes she "resides" in?

Anonymous said...

Looks like the house "Reader sightings - 2241 SE 26th" is marked down to $599. Buy now or forever be priced out. I have a 5/1 ARM IO for you:O)

Anonymous said...

I'd really like to buy my first home. You'd think I could get a starter bungalow or small house with around 1000 sq feet for 200000, but its still slim pickings

Anonymous said...

I see 800 square foot tear downs for less than 200K in crime ridden hoods. Ridiculous, isn't it!

PDXOutsider said...

"I'd really like to buy my first home. You'd think I could get a starter bungalow or small house with around 1000 sq feet for 200000, but its still slim pickings"

If you have good credit, start low-balling the sellers. With sales down 40% and inventory at all time highs, it won't be long before the prices start falling. Besides, with the end of funny money you probably don't have too much competition at the entry level.

Anonymous said...

pdx outsider, thanks for the good advice on low balling on some properties. I do have excellent credit (769) and on a 200,000 offer I could put about 15 percent down and I've been preapproved. My agent seems to be discouraging me from making offers more than 5000 below asking price but shouldnt he make whatever offers I tell him to make?

At any rate I'm glad I found this blog as it seems to be the only one not afraid to tell it like it is.

PDXOutsider said...

"pdx outsider, thanks for the good advice on low balling on some properties. I do have excellent credit (769) and on a 200,000 offer I could put about 15 percent down and I've been preapproved. My agent seems to be discouraging me from making offers more than 5000 below asking price but shouldnt he make whatever offers I tell him to make?

At any rate I'm glad I found this blog as it seems to be the only one not afraid to tell it like it is."

Yes! Your Realtor works for YOU, and he/she should make whatever offer you think is fair. If they won't, there are plenty of Realtors out there that will gladly help you.

There are two reasons why your Realtor is giving you this advice.

1. The higher you bid, the more likely the sale, and the more likely they make a sale and a commission. With no sale, they're not making jack.

2. The higher the price, the more they make on commission.

I wish there were alternative compensation schemes (fixed fee plus bonus for lower price) but apparently that's illegal.

If you've got good credit and a cash down payment, you're in the driver's seat right now. Few people are in your position or sales wouldn't be down 40%.

Unfortunately a lot of low end houses were 100% financed, so they might not be able to drop the price without lender approval. You might want to ask this before making a lowball offer.

The latest S&P housing data will be released tomorrow, I predict a further decline in prices. So patience should pay off.

Anonymous said...

I'm curious, where would one go to find foreclosures in Portland? thanks.

Anonymous said...

“pdx outsider, thanks for the good advice on low balling on some properties. I do have excellent credit (769) and on a 200,000 offer I could put about 15 percent down and I've been preapproved. My agent seems to be discouraging me from making offers more than 5000 below asking price but shouldnt he make whatever offers I tell him to make?”

As a good Realtor with past experience working in a non-bubble market, I don't buy into idea of automatically offering full price or X% of full price, as some agents in Portland seem to believe, even if the house is brand new on the market. Sellers set the asking price, often ignore their agent’s CMA and start out asking too much.

I do a thorough market analysis of the property my buyer is interested in, and in some cases I suggest he offer LESS than he wants to pay because the comps don't support that price. Appraisers are much tougher now and if the house won’t appraise, the buyer or seller have to come up with the extra cash. My last two accepted offers, both on brand new listings, were 10K and 20K less than asking price.

I also don't want my buyer paying too much for the house (and the difference in commission isn’t that much – I’m only getting about 1.5% of the total commission). If he decides to sell in the next year or so, I want to get his listing and be able to sell it. Buyers won’t overpay in the “new” market and my seller will blame me for overpaying when he purchased.

Have your agent do a CMA to see if he can justify the price you want to offer. If he can, he should present those comps (in person, if possible) to the seller with your offer and do his best to convince the seller that your offer is fair and that you are a serious buyer.

If you really want a particular house, you should be willing to pay fair market value. Remember, someday you’ll be selling your house – will you accept a low ball offer or will you want fair market value?

Good luck!!

Anonymous said...

"I wish there were alternative compensation schemes (fixed fee plus bonus for lower price) but apparently that's illegal."

Since the seller pays the commission, he'd want to pay the bonus on a HIGHER selling price - how would this benefit the buyer?

PDXOutsider said...

"Since the seller pays the commission, he'd want to pay the bonus on a HIGHER selling price - how would this benefit the buyer?"

Actually, the buyer pays the commission. They're the ones shelling out the money. The price reflects the inclusion of the commission.

The buyers agent and the sellers agent typically split the commission. Everybody I've talked to will be more flexible on the price if we buy without a buyer's agent.

If the seller wants to use an agent that's up to them. But I'd like to be able to pay a buyer's agent a fixed fee plus bonus, not a commission that's biased against me. Heck, sellers can now list on the RMLS for a fixed fee, why can't I buy for a fixed fee?

PDXOutsider said...

"I'm curious, where would one go to find foreclosures in Portland? thanks."

Lots of places. Trulia. RealtyTrac. foreclosure.com

There aren't a whole lot of foreclosures out there, and most of them are under water (they owe more on the house that it's currently worth). There are professionals that work the auctions to find good houses to flip.

It's not the easy money maker that people think it is, but if you're serious, you'll need a subscription to one of the sites above. THere are lots of books/tips out there on different strategies. Good luck.

PDXOutsider said...

anon April 29, 2008 5:07 PM: well put. that sounds like much better advice than the previous posted is getting.

you should also state your name, you sound like a good agent.

Tyler/anonymous said...

that does sound like good honest advice. You should post your name as my agent has just announced that she is leaving the real estate biz and i'm looking for an agent. I didn't want to give the impression that I want to low ball every offer. I just wanted my agent to stop showing me homes I've already said I can't afford and then telling me that of is as good as its going to get.

caryn said...

Nice.. video of foreclosure destruction. http://cosmos.bcst.yahoo.com/up/player/popup/?rn=3906861&cl=7622521&ch=4226720&src=news

squeezed said...

I didn't want to give the impression that I want to low ball every offer.

Why ever not?


"Have your agent do a CMA to see if he can justify the price you want to offer"

Houses are not selling. A CMA will include homes that sold many months ago.

Anonymous said...

Tyler...drop me a line at larryb@meadowsgroup.com

My website is housethatfits.com

Squeezed...houses are indeed selling, just not as fast or in the volume as in the past few years. Some houses (priced right and in top condition) are even getting multiple offers despite the cooler market.

pdxoutsider... you're absolutely right, the buyer actually pays the commission, but just try getting a seller to understand that when those dollars are coming off of his side of the settlement statement ;-)

More to come later on your idea about the buyer paying a fee/bonus and dual agency...