Monthly Archives: November 2010

Danger Will Robinson

Just because things are a little slow in the Transaction Department at Real Estate Central these days, I don’t want any of you to think the REC is slacking off.  Don’t worry. We’re right on top of it.

Trust me.   Even when we aren’t crazy-busy fueling all those forces that drive the engine of the economy in our ongoing effort to spread money around the planet and grease the wheels of international finance, we’ve still got plenty of other things on our to-do list.

Not the least of which is our duty to protect and serve YOU – the huge backlog of clients sitting in our tickler files, who may or may not actually end up buying or selling something someday in the (hopefully) not to distant future. It’s a solemn charge we take very…well…solemnly. Specially in these solemn times!

But protect against what? Simple. Against everything.  Every single thing you can possibly imagine. The premise?  If  someone can think it…then surely we must all need protection from it.

But protect how? By warning everyone of course.  By sounding the clarion call. By disclosing to Buyers what Sellers do and mostly do not know about their own properties. And in turn disclosing to Buyers, the ever-growing list of worrisome issues they might want to obsess about. The great compendium of woe orbiting around in the grey area of space somewhere between what is said and what remains unsaid.

So whether or not we happen to be Agents with a whole lot of “closure” going on these days, we remain resolute in our role as Agents making sure a whole lot of “disclosure” is going on in the ongoing paper-jam of a paper-chase that is Real Estate.

As proof, I’m proud to announce:  This winter! Coming to a disclosure package near you!  A long-awaited chip off the old boilerplate.  A big, bold WARNING about the impending scourge of BEDBUGS  poised to sweep over our psyches!   Following in the faded footsteps of other Ghosts of Disclosure Past still buried deep in the bulging escrow files of today!  Radon gas! Asbestos! Lead-based paint! Toxic mold! Bedbugs is an idea whose time has come. Bedbugs are ready to take their place in the pantheon.

Surprisingly, it isn’t California surfing the wave of popularity on this particular urban legend.  It is New York, where a once-nascent epidemic of bedbugs has suddenly gone from hot topic to targeted legislation.  This quote from one of our popular REC newsfeeds:

In a recent condo sale on the Upper West Side, Louise Phillips Forbes, of Halstead Property, represented a seller and spent about six days hunting down bedbug history, or the lack thereof, to help seal the deal. The buyer asked about bedbugs and was not satisfied just knowing that the seller knew of no bedbugs in the building.  The building had recently switched managing agents, so Ms. Forbes had to get statements from both agents, and she also checked with three members of the condo board, none of whom knew of any bedbug problems.

And this:

Assemblywoman Linda B. Rosenthal, Democrat from the Upper West Side, said she planned to introduce a separate disclosure law for co-ops and condos next year. “I think it’s great if people are voluntarily disclosing the information already,” she said. “Since this is such an epidemic, the more transparency the better.”

If New York is doing it, can California resist the temptation to add Bedbugs to its Ten Most Wanted List of Dangerous Disclosures?  We’ve got a reputation to uphold.  We’re the State most likely to over-amp on any and all forms of consumer protection that raise their well-meaning heads to bite us in the ass.  We also have to preserve our status as the State voted Most Likely to Succeed in having everyone sue everyone else for something.  All that protecting requires a steady stream of victims.

So, even though a whole lot of properties aren’t selling right now,  Buyers, Sellers,  Looky-Loos … you want us on that wall.  You need us on that wall!  Standing guard.  Offering the cloak of protection from everything under the sun (Check the UV Ray  Disclosure.)

At the end of the day, at the end of the long process of home-buying. when you are finally settled into your new home and lay your head down on your soft pillow of dreams… we at Real Estate Central want you to be able to sleep tight, knowing that the bedbugs won’t bite. Not on our watch.

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Manifestering Destiny

Welcome to Real Estate of Mind.  Where sometimes the Map really is the Territory.   And vice versa. Where it often feels like déjà vu all over again as in – Real Estate Held Hostage: Groundhog Day 347. And other times…it just feels like bushelfuls of erstwhile buyers and sellers have decided to take voluntary furloughs from the mirage of a marketplace.

Meanwhile …more and more real estate agents are seceding from the arbitrary union of supply and demand. Electing to re-inflate their egos by selling a lot more properties in Farmville. Purportedly there is robust activity there. No pending signs of an  “enthusiasm gap” in that neck of the virtual woods.

Yep. Another installment and another banner week with more news than any of us could possibly use.  As someone somewhere said not long ago: “getting information in the age of the internet is like getting a drink of water from a fire hose.”

The President of the National Association of Realtors had a very quotable quote bouncing around the Country this week.   Speaking about even tougher lending standards coming from mortgage industry giants like Wells Fargo and Bank of America, Ron Phipps said:  “We’ve gone from silly to stupid.”

Any of you small fish in the great big sea who have gone through the loan process recently are probably wondering why he understated the situation so badly.  Is there some other expression that magnifies dumb and dumber to the right degree? Or measures the true exponential growth of the system’s decay?   We’ve gone from SNAFU to  FUBAR?

People used to worry about  “bait and switch” tactics popping up with an occasional lender here and there.  Dangling a carrot and then pulling it back once they were sucked in. Now, we’re enmeshed in the biggest bait and switch bunco scam in history.

Borrowers, we’ve got good news and bad news for you. First, the good news. Rates are about as low as they’re ever going to go. The bad news? You only get them if you survive the water-boarding process euphemistically known as qualifying.

In other words…loans aren’t for everyone.  Just as the notion of home ownership for everyone is being radically revised in the Americanized version of the cultural revolution.   The pendulum has swung on our Manifestering Destiny.  The cult of homeownership is being rehabilitated. Time Magazine says it is time.

And so the Monopoly Game keeps getting shorter.  The bank wins long before anyone else starts rolling the dice or lands on chance.  Not to worry though. Our own Central Bank, the Federal Reserve, has stepped up to the plate with a plan to stimulate the economy by buying $600 billion in treasuries.  This of course, after economists back-dated the end of the recession to July of 2009.   Isn’t it only fitting that the timeline for stimulus be moved further backward too. Or is that forward?

Soft recovery?  Saw toothed recovery?  Jobless recovery? Heck, I don’t know.

Anyway the Feds’ plan to fluff the aura of the economy is called “quantitative easing”. Another name for pumping more bucks into the system.   How about a little more “qualitative easing” while they’re at it?

(By the way, is anyone else out there a little freaked out by the fact that the Feds hold regular meetings at a place called Jeckyll Island? Do you think they also have secret picnics in Hyde Park?)

But speaking of more bucks in the system.  It’s probably a good thing.  A world without enough new bucks gets stuck passing the same old bucks around too long. And those bucks have to stop somewhere, sometime.

The Real Estate of Mind Book Club recommends All The Devils Are Here by Bethany McLean and Joe Nocera.  The premise?  Systemic Culpability.  We all took part. We all made choices. It all happened right under all of our noses. It wasn’t just an autistic computer savant sitting in a darkened room dreaming up credit default swaps who was to blame.

If we’re not all going to own houses anymore at least maybe we can all own up to our individual responsibility for the real estate of affairs we’re in.

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Predictions or Predilictions?

There I was driving home on Highway 1 the other night, ruminating about the future of real estate, when I came to a grinding halt in bumper-to-bumper traffic. As I sat there unmoving, I glanced up at the Caltans billboard near 41st Avenue and noticed a string of strange flashing lights and random words running across the electronic screen.

Suddenly my cell phone rang and an eerie mechanical voice on the other end said: “Pay attention and write.” I was so shocked I grabbed my laptop and for the next three hours a series of messages channeled through the traffic board as I feverishly tried to keep up with my meager typing skills.

What follows is only a small part of all I was shown and told. Predictions for the future courtesy of some Century 23 Agent traveling back in time? Who knows? Fact or fantasy? You be the judge. I’m just the instrument of some higher power with a heck of a cell phone bill.

•    A missing Escrow Officer will be found alive under a massive avalanche of paper after surviving 6 days without food, water or a sanity check.

•    Increasing numbers of Sellers will enroll in Mime School attempting to look more convincing while going through the motions.

•    A study by the National Association of Realtors will conclude that making more Pocket Calls does not result in a larger inventory of Pocket Listings.

•    The entire UC Merced campus will be shut down and leased out as a training facility for Real Estate Foreclosure Specialists.  It will be unceremoniously nicknamed F.U. by the media.

•    A blue ribbon panel of psychologists will declare a national epidemic of  “buyer’s remorse” and the Surgeon General will require all forms of retail therapy to display prominent warning labels.

•    Home Ownership will officially be declared an alienable right of the American Dream.

•    An entire Cabrillo College class in Abnormal Psychology will apprentice at a local Real Estate Company for a year of in-depth field study.

•    A rising number of mortgage defaults in Northern California will be linked to the plummeting value of home-grown marijuana on neighborhood streets.

•    Practitioners of Transcendental Meditation will be paid 100 million dollars to meditate on the recovery of the National Housing Market in a stimulus program dubbed “Om for Home.”

•    In a joint venture with PG&E, several large financial institutions will attempt to install Smart Meters on Consumer Bank Accounts.

•    Pest Control Companies faced with lagging revenues in a slow real estate market will begin offering Bed Bug Extermination Service to 5 star resorts and hotels.

•    Mass outbreaks of St. Vitus  dancing will  be traced to the hallucinogenic effects of a new strain of toxic mold found growing in vacant foreclosures across the country.

•    Organic Sellers will attempt to secede from the market by forming a separate MLS where bank-owned properties are prevented from being listed for sale.

•    Disenchanted Appraisers unhappy with new legislation will quit the business and flock to an evangelical end-of-days cult called Appraise the Lord and Pass the Ammunition.

•    New legislation to slow the mounting tide of foreclosures will require troubled properties to first be labeled Afault, Befault and Cefault before being allowed to go to Default.

•    In November a local real estate agent will give birth to a 14 pound escrow file and be prominently featured on the cover of the National Enquirer.

•    A local psychiatrist-turned-real-estate-agent will lose both of his licenses after he is discovered marketing pre-pre-pre-foreclosure properties on Craigslist using confidential client information.

•    As the shadow inventory of homes held off market by the nation’s largest banks grows to record numbers Foreclosures will be re-named Noclosures.  Lamont Cranston the Sixth will be appointed to get the bottom of it all.

•    A radical cult of new age economists will flock to Sedona, Arizona to celebrate the advent of the Un-harmonic Convergence, otherwise known as deflation.

•    New Fair Housing laws will require Short Sales to be called Chronologically-Challenged Sales in all real estate advertising

•    Local Real Estate experts will issue a forecast guaranteeing that the market will be much better in 2011.  When pressed for specifics a terse one page release will be issued explaining that “better” really means “less bad.”

In a related story, a record number of homeowners will burn their mortgages and declare their freedom in a series of  celebrations modeled on the “tea party” movement. Freedom will be identified as “just another word for nothing left to lose. ”

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SPAM NEVER SLEEPS!

Something about the story in Thursday’s paper sounded familiar. A self-reflexive wave of resonance rippled through my psyche.  I had to laugh.  The world keeps reinventing itself – in exactly the same way.

See if I got this straight…. A giant luxury liner on the open ocean. A small city of people  on board for a seven day (or three hour ) cruise. An unexpected chain of events leaves them dead in the water. Stabilizers gone.  Rocking and rolling side to side in perfect pitch to the perfect storm of events.

Not the happy-go-lucky, love boat, love-fest folks signed on for.  No air conditioning. No working toilets.  No Kathy Lee.  Just interminable games of shuffle board and gin rummy.

But no worries.  Rescue is underway.  They’re turning that big ship around. Towing it back to shore.  Policy-makers are vowing full restitution. Offering free tickets on a future cruise. Most importantly, they’ve helicoptered in thousands of pounds of spam to feed the unwashed masses.

The moral of the story?  When all else fails….there’s always spam. When the going gets tough? The tough get spamming.  Those that can – do. Those that can’t? You guessed it.  They spam.

So whether it’s the Carnival Cruise line,  the USS Minnow or the next upside down, underwater installment of the Poseidon Adventure that is real estate circa 2010….here we are – packed  into the deserted aisles of the marketplace. In the absence of anything close to the real sale-ing we thought we’d be doing when we first started out, looks like we’re going to be dining on spam for a while.

The longer I sit, waiting for good dough to show, the larger the diet of canned spam gets.  A never-ending buffet streaming my way 24/7.   Money really does sleep. It’s spam that doesn’t.

Long ago we made things. Then we morphed into buying things others made. Now, we’re that great hub of virtual industry built on  “selling our sell” to anyone who may or may not even be remotely interested in listening.  Check it out. That’s what all my Facebook , Twitter, and LinkedIn friends, followers and contacts say on their social media pages.

So what does real estate spam look like when you take the lid off?  We’ll let’s just fire up the computer and see what the smorgasbord of mystery meat looks like in today’s in-box:

There’s a Jiffy Lube Franchise for sale in Boca Raton!  I can Maximize My Exposure with Smarter Agent!   Learn the 5 Must-Do Things that Top Producers Already Know! There’s a Gourmet Fruit Basket – a house-warming gift for satisfied clients!  A thousand Personalized Refrigerator Magnets to hand out to new ones.  I can make $67,000 in Six Months Doing Short Sales!  Or test drive a Certified Distressed Property Expert  (CDPE) Training Course!  There’s a Secret Market that Sizzles! An opportunity to become a Forensic Loan Auditor!  Another that will Double My Sphere of Influence!  I can earn Outrageous Commissions from REO’s ! Join a Discount Brokerage where there is No Split! Maybe it really is time to Jump Start My Marketing and Qualify for Unlimited Buyer Leads in my area!

But wait a minute…Mortgage Fraud is an Epidemic.  And the NAR has issued a Warning about Short Sale Legal Issues.  And apparently it is tough to Crack the FHA Appraisal Code,  Are they really doing Live Home Auctions on Television?  And I’m not sure I need any of those Black Friday Specials.  And what is Skip Tracing vs Cyber-Tracing?  I don’t think I want to Understand UCC Article 9.  Or Throw Money Out the Window. And Redfin is claiming that our Bay Area Market is a Twilight Zone!

Man, it’s only 9:30am and I’m exhausted . I feel like Gilligan running aimlessly through the coconuts without a compass.  This is harder than real work.  I think I’m going to rename this Perfect Storm the “Perfect Maelstrom.” That’s kind of like a storm on steroids  with a lot more whirlpool action  whipping it up into an incomprehensible frenzy.

The trouble with maelstroms is, you can’t tell whether they will eventually come full circle and pass. Or whether they will just spiral around under the weight of their own gravity and  head further down the drain.  In the meantime…stay hungry my friends.

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A Real Estate Fear Fest!

Recovered from last week’s celebration yet? Did you finally manage to squeeze the last of the fear out of your veins?  I’m talking about Halloween of course.  The official post-mortem dedicated to the wages of fright. The ritual orgy that pays homage to our worst nightmares. The mass exorcism that targets the insidious bogeymen residing in the closet of our collective psyches.

On Halloween we reach inside and summon our fears instead of hiding them. We conjure up our demons instead of stuffing them down.  We put them all front and center on colorful display while howling at the moon and dancing with delirious abandon.

On Halloween we try to scare the crap out of ourselves on purpose! And hopefully…in the process…we somehow manage to scare ourselves silly in a great cathartic flip that purges the very thing we’ve been binging on  – wiping the slate clean for yet another year to come.

Naturally I attended the big Real Estate Halloween Party that took place on a spooky cul-de-sac lined with foreclosures out in the middle of nowhere.  Darkened windows and doorways resembled the missing teeth and vacant stares of carved-up, hollowed-out pumpkins, ceremoniously emptied for the occasion.  Huge cobwebs hung like Spanish moss over For Sale Signs that were leaning at odd angles in precarious neglect. Buzzards circled above homes that had recently fallen into default  – designating  them as “addressed for distress” and making them easy prey for all the ominous land sharks prowling around the neighborhood.

There we all were, partying down like it was 1992.  Crazy conga lines of buyers and sellers were snaking through the crowd accompanied by the wild strains of apocalypso music.  Loan brokers in Alan Greenspan masks were handing out big Nestle Credit Crunch trick or treat candy with the same fervor that they had handed out subprime loans four or five years ago.   Everywhere people were chewing on huge wads of Real Estate Bubble Gum,  inflating giant bubbles with hot air, popping them loudly when they grew bigger than their own heads.

Someone disguised as Naked Greed was streaking through the crowd chased by another character dressed in a skimpy Real Estate Rally Thong.   There were plenty of Monster Houses milling about, strutting their stuff.  Someone else was dressed up as The Great Unknown  moving through the masses surrounded by a Greek chorus of little gremlins calling themselves the What-Ifs. They eagerly whispered fearful thoughts into everyone’s ears with high-pitched, banshee-like voices.

Escrow officers were wandering around in wigs made to look like their hair was on fire.  Many of them wore paper-chains wrapped around their bodies fashioned out of loan documents issued by the Government Office of Cosmic Redundancy. One even came decked out as a mummified HUD statement.  I saw a couple of Blind Appraisers searching for comps.  Groups of Swarming Termites. Sellers dressed up like Statues of St Joseph. Looky-Loos masquerading as Interested Partiers.

There were Underwriters who had morphed into Undertakers busy trying to bury the market, declaring that mortgages really did originate from the French words for “death tax.”    Prophets of Doom and Gloom roamed the cul-de-sac.  Zombie Buyers haunted the homes of the growing Legion of Unsolds.  The American Dream was dressed in a black robe and carried a scythe.

There was The Grinch That Stole the Economy lugging  a bag full of gifts labeled Credit Default Swaps and Derivatives,  Someone was dressed up like a Doctor, running around trying to find the Market’s Pulse.  Several others covered themselves in those big blue Tarps and painted dollar signs on the side.   A few came as Toxic Assets paired with CEOs dressed in Armani HazMat Suits.  The Gordon Gekko mask made a big comeback this year.

Freddie Kruger made an appearance waving a Deed of Trust securing a new movie installment called “Nightmare on Main Street.”  But he was almost eclipsed by a giant swathe of darkness calling itself the Shadow Inventory.

Wow. What a party.  Say what you want about real estate…we do fear well.  In fact, this whole year has been one long, ongoing fear fest.  Lots of tearing of hair.  Biting of nails. Gnashing of teeth. Silent and not-so-silent screams of frustration, disappointment and dawning realization. Plenty of lost souls out there wandering around with grave faces on. Gives me goose bumps just to think about it.

If fear never sleeps here in real estate land and just stays simmering in the cauldron 365 days a year.. what the hell…we might as well celebrate and see if we can at least tire it out in one long nights journey into day.  Maybe we can get to a place where we can finally say goodbye to the Ghost of Markets Past.

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