Tag Archives: Surreal Estate

THE DICKENS YOU SAY?

“It was the best of times. It was the worst of times.” Or, if I was the Great Decider-er, maybe I would say it is the better-er of times and it is the worser-er of times. Either way, it’s still the Tale of Two Markets here, in the decidedly surreal world of real estate.

Dickens has the story right. The words ring true: “…it was the epoch of belief, it was the epoch of incredulity, it was the season of Light, it was the season of Darkness, it was the spring of hope, it was the winter of despair, we had everything before us, we had nothing before us, we were all going direct to heaven, we were all going direct the other way…”

Two things happened this past week, that brought my angst-inducing astigmatism into sharper focus.

The first: On Wednesday, I wrote an offer for a client on a new listing in Soquel. Bank-owned. Seven quick offers. Two short days on market. Competition. Overbids. Client’s adrenalin pumping. Racing to write the offer. Racing to get the pre-approval letter. A familiar flashback. Shades of 2005!

The fears and doubts of the multiple offer game. What can we do to please the Seller? Make our offer look more attractive? Did we offer enough? Now, we wait for the mysterious ‘asset manager’ to render a decision from on high. Might take 3 or 4 days. Or a week. That helpless feeling. Something you have absolutely no control over welling up and washing over. And so we wait. Doesn’t feel much like a buyer’s market, like it’s supposed to be.

The second thing: On Thursday I met with the Seller of a listing I put on a month ago. It hasn’t sold. A few tire-kickers. No offers. He’s worried about the growing no-shows. Should we have put it on the market earlier? Are we going to have to lower the price? He is freaking out a little more each day as another drip of Chinese water torture hits him in the head and kicks him in the ass.

We thought we had it right. We looked at the comps and knocked the list price down another $25k to make it even more desirable. And yet.. Nada. No hint of adrenalin in the air. Just a few Agents calling to ask why the seller is selling. Or wondering what his “motivation” is. Or whether there is “flexibility” in the price. Doesn’t feel much like a market on the way up, like it’s supposed to be.

Small moments in the larger scheme of things. But representative of the mixed messages the meta-market is sending. Are we really gaining traction on what still feels like mighty thin ice? Are we (pick one): At the bottom? Near the bottom? Past the bottom. On the way up? Or just getting set up for the next big dip?

I finally figured out why this is all so hard to figure out. We don’t have one real, real estate market anymore. We have two. And both happen to share the same MLS circulatory system just like Jekyll and Hyde co-existed in the same brain. Our two markets are like parallel dimensions occupying the same space and time. They look similar at first glance. They overlap in some ways. But they are wormholes apart in other ways. And the spit confuses the hell out of us, because we keep getting them mixed up. Mistaking them for each other. Or wanting one to become the other. Or fearing one is becoming the other whether we want it to or not.

There is the Distressed Real Estate Market. And there is the “Regular” Real Estate Market that keeps saying it isn’t distressed.

Bank-owned Properties, Short Sales and any number of other situations lumped under the umbrella of pre-foreclosures made up more than 40% of the sales last year. Almost half.

Spring has arrived (a little early) for all those Real People who own those non-distressed properties and see themselves as being the Real, Real Estate Market.
Time for the real buying to begin. Any day now. Those real sellers are waiting for you real buyers.

For those basketball afficionados out there, old enough to remember when there was both an NBA and a separate ABA, this feels like then. There were two different leagues playing the same game but also playing slightly different games. What was clear to all who could read the writing on the wall, was, sooner or later they were going to have to merge. There wasn’t room for both.

Well sports fans, these real estate markets are going to have to merge too. I’ve already accepted the three point shot. I just hope we don’t get stuck playing with a red, white and blue ball.

Share

Surreal Estate of Mind: Conspiracy or Confederacy of Dunces?

la_condition_humaine-magritteIn solidarity with the times, I’ve renamed today’s column Surreal Estate of Mind. Surreal is often used, when something real begins to take on an altered, disorienting, dream-like quality. You know. Like real estate. Like right now.

I don’t think Oswald acted alone. Drones and Chem Trails populate the sky. Fluoridation is a communist plot. Old, fat Republicans regularly get naked at Bohemian Grove. Freemasons? Bavarian Illuminati? The pyramid on the dollar bill? Yes. Yes. And more Yes! Sasquatch is alive and well and living wherever he wants. And to be completely honest …I think Eisenhower cut a deal with the aliens at a remote airplane hanger outside of Palm Springs in 1957.

It is all of the rest of life and the way things aren’t working in real estate that I’m not sure of…

Maybe it’s a little-known side-effect of the swine flu pandemic but I keep meeting respectable, hard-working, middle class people infected with an odd, feverish, lingering malaise that causes them to imagine they are deer in the headlights, standing nervously in the eye of a hurricane, waiting quietly for the proverbial other shoe to drop.

I may be a conspiracy buff but I’m not a conspiracy nut. I don’t really want to believe there is some giant, premeditated, not-so-secret, conspiracy going on between the Government and the Big Banks when it comes to controlling the hearts and minds of the collective real estate community. I’d prefer to think there weren’t any additional pairs of unseen hands tugging on puppet strings attached to the invisible hand of the marketplace. Or any Machiavellian plot trying to control and manipulate the entire system that controls and manipulates the entire system that I watch real people interact with and try to feel some modicum of control over in the real world of real estate.

So I’m hoping that some of you, with far greater experience than I – those with more formal training, studied insight, astute knowledge, honed perspective, rational answers, intuitive powers – will step up and shout me down. Because I want you to be my passionate and rabid de-bunkers. I really, truly, don’t want to believe that there is a conspiracy afoot trying to suspend my disbelief and convince me to accept the notion that all is well in real estate land and bank land and economy land. Please, tell me I’m wrong. Tell me I’ve got nothing to worry about. And that my clients have nothing to worry about. Make the surreal-ness of it all make sense just a little sense.

None of us, working in real estate, have ever been in this place before. This is undiscovered country. No map. No pre-packaged GPS system issued with each listing or each buyer’s pre-approval letter or with every escrow that gets opened. No soothing software voice-over ready to dole out directions on how to get there from here (wherever there is and wherever here is.)

So maybe the things I am seeing, aren’t really there at all. Maybe I’m making them up. Maybe they are just the usual suspects that are always around. Maybe they are mere figments of my imagination rather than the shadowy outlines of something more scary and nefarious lurking in my neck of these dark, dark woods. Maybe no one is responsible for the mysterious machinations I see people wrestling with daily. Maybe it’s just bio-rhythms. Or a ginormous confluence of bad hair days. Or Mercury in Retrograde. Exponentially. Up the yin yang.

All I know is, there are lots of trails leading off in different directions in these woods. I don’t know if any off them will eventually lead the real estate industry back home or not. For the time being, if you follow the scattered bread crumbs on any tangent you care to take, it all just gets curiouser and curiouser…

Why doesn’t it feel better in our guts while reaching for each small bone of good news thrown our way?…What happens when big banks control supply (shadow inventory) and demand (credit crunch) simultaneously at the same time?… If the conspirators achieved their immediate goal of heading off total collapse, when are the real changes and reforms in the system going to start?… If real estate is really getting that better, why would we consider paying everyone to buy a home by giving them all tax credits?…Let me repeat that – paying people to buy homes as a sales gimmick to sell the recovery!…Why not force the banks to release the huge inventory of homes locked in their foreclosure vaults?.. Wouldn’t more supply lower prices for first time buyers?…Who is going to pick up the slack and buy the loans the banks are making, when the Feds bow out soon, as they say they are planning to do?… Won’t interest rates go up?… In a jobless recovery, when incomes are necessary to qualify for full doc loans and interest rates go up and so many people who ought to be buyers already can’t afford the low-end clunkers that investors are paying all cash for…how will the market sustain itself?… How can there be recovery?…Where will the demand come from to meet the supply that eventually has to be released?

Inquiring minds want to know. Conspiracy? Or Confederacy of Dunces? Let me know what you know …

Share