#1

Lennox: People accused me of being a big dumb dufuss with buck teeth and a bald head, but I showed them.

Tim: Anybody with the IQ of a bug who has managed to get as rich as this guy has some kind of special gift. All my charts and graphs provide me with no insights that allow me to understand this.

#2

Lennox: I hate this person’s guts for telling the truth about real estate. I’ve only made $5 million this year and I could have made $10 million if it weren’t for him.

Tim: Whatever, I’ll shake this liars hand, but that doesn’t mean I have to like him.

#3

Lennox: Your tie is better than mine but I have a better jacket.

Tim: The only reason I don’t throw in the towell and join his team is because I would be forced to wear a stupid looking jacket.

#4:

Lennox: Hrrr…hrrr…hrrr. I just passed gas.

Tim: Ewe

SE made an assertion that might or might not be true. If it is not true, then it can be logically refuted.

Lennox says: “I am your father The Tim. The Force is strong within you. Use your powers of real estate psychology to make the weak minded buy homes and pay a six percent commission. The armies of my Real Estate Empire are ready to strike. With your help the Force can move the market upward and make it true that here has never been a better time to buy.”

The Tim says: “Is that another Real Estate Bubble in your pocket or are you just happy to see me?”

Picture caption #2:

Lennox says: “Thank you for comming to our family gathering The Tim. I would like you to consider me as your Scottfather. I have heard much about you and that group of yours . . . What is it? . . . The Bubble? You honor us with your presence and we wish you every success. I feel that an ambitious young man like you deserves the best opportunity to succeed in these difficult times so I would like to make you an offer you can’t refuse to join our family in making this the best time to buy. I would hate to see you make the wrong decision. You could find yourself sleeping with the fishes.”

The Tim says: “Thank you Scottfather. But I’m not sure I understand. When you say sleeping with the fishes, are we talking waterfront? And is that a rental, or do I have to buy? I’m not interested in a purchase at current market prices.

Caption #3:

Lennox says: “Stop calling me the wicked broker of the west. Your meddling has helped kill the market and if you don’t stop saying those things I’ll have my army of flying monkeys drop a house on you and your little dog too. Wait . . . oh no . . . . I’m meltingggggggg . . . . . .”

The Tim Says: “Hey you’re right, you are melting, and that bubble is melting too. Maybe you should try Extenze. I don’t think it works either but it’s cheaper than the government stimulus.”

Let’s calculate all the money that is made out of thin air. It makes no difference what a property value is, the loan is made, and people pay. If they don’t pay then the bank gets the property. If nothing else they can rent the property. They can hold an asset on the books at the loan amount or a discounted loan amount, rent it, and in time, the money is recaptured.

It seems to me every one in the world is concerned because investments are making smaller returns. What I’m getting at is that I see how consumers are losing money, but Financial Institutions seem to be holding all the cards, with the only down side being they will simply make less. I don’t see the losses to the Institutions.

Sorry I missed that J. Lennox Scott talk now. I was mostly focused in the social media sessions. Though I think Tim and I must have been in that Marc Savitt breakout at the same time…

–BryanH. (formerly SF_Boomerang)

Ouch. Dang facts!

Brad- the name of this site is “Seattle Bubble,” not “Burst Seattle’s Bubble.” Please adjust your behavior and fall in line. ;-)

In all seriousness, the younger folks I know are concerned about a number of things, but buying that first home doesn’t seem to be very high on the list.

He said it’s not just loan originators that pressure appraisers, it’s real estate agents along with the homeowners themselves.

I think I’ve only contacted two appraisers ever. The first was just to make sure the appraiser was aware that the last four sales in the same complex sold within a week of going on the market. The second was to just find out when it was expected to be returned, since he had been to the property quite a while earlier.

The worst appraisals are on refinances, where there is no real estate agent.

I am with Kary. Most comments are from renters that have done the research, have not found those deals, and are questioning the reporting.

I do have to agree though that in the current economic environment I am not surprised apartments are pulling their pants down. When I moved to Seattle in 91 (unemployment at about 9%), I rented a 1 bedroom place on the eastside, on 148th (I think it’s called Kirkland Meadows – right next to the Redmond fire station) for low $500s per month, 6 month lease, first month free (January 1992). I remember it because I had never had a deal like that in FL.

Patient,

I’m with you. If we didn’t have HVCC we’d still have people pressuring appraisers to bring in higher values on resales and LOWER values on short sale transactions.

I asked Marc Savitt a good question during the breakout sessions: If we didn’t have HVCC, then what would keep loan originators from pressuring appraisers in today’s market?

He said it’s not just loan originators that pressure appraisers, it’s real estate agents along with the homeowners themselves.

His idea was to have every person sign a statement that he/she did not pressure the appraiser to influence the home value. I thought that was a nice idea because it includes everyone, not just the loan originators.

I remember years and years of hearing appraisers complain on Ben Jones’ Housing Bubble Blog and other places about how they were forced out of business if they refused to lie. Hundreds of complaints were sent to government agencies and regulators, who of course did “chocolate” about it. After all, they can’t see bubbles until they pop and it’s not their job to actually, well, do their job, right?

I have a question. Bret Bertolin says:

“You might think itâ��s a virtue to save moreâ�¦ we look at it the other way when weâ��re in this kind of a situation. High savings slows growth.”

So, how exactly am I supposed to spend the money in my savings account, in order to revive the economy? Just go out and jump on a home? Or invest them in stocks?

Ah, the paradox of thrift, another age-old fallacy given pseudo-intellectual legitimacy by the great huckster Keynes.

http://en.wikipedia.org/wiki/Paradox_of_thrift

Production comes from investment, and investment comes from saving. But no need to worry. Today, the money is effectively stolen from savers via inflation by the Fed’s printing press, and yields are forced to eternal lows by government distortion of the interest market so that savers are forced to consume their capital or else put it in the equity markets in a desperate attempt to get some return, where of course Government Sachs can steal it. We’ve pretty well solved the saving problem in America.

Nonsense! JLS has an even better, even more historic opportunity planned for the April 30th through May 31st period.

But rest assured, he and his friends are saving the best for June and July. You have to ask yourself- and answer truthfully- just how much awesomeness can you handle?

HAHAHA this comment made my day.
Rest assured, I can handle a Surprisingly Large Amount of awesomeness.

“I was told to keep this positive…”

“I found it interesting that the presenters would open their discussion with that premise because it made me, as an audience member wonder what they were NOT saying but wanted to say.”

This is just amazing!!! Jillayne; were people talking about this “disclosure” during breaks? So they just came out and announced “everything I’ll say is bull s.”.

Brad @28: Nicely described.

* Are taking 5 years or more on average to complete a Bachelor’s degree.

* Are leaving college with an average of $22,000 in non-dischargable student loan debt.

* Are graduating into the most sustained hiring downturn in a generation, with wage-depressing effects that will likely last throughout their careers. Two income families will earn hundreds of thousands of dollars less in their lifetime than those who entered the job market in a time of low unemployment.

* Are carrying an average of $9,000 / person in credit card debt.

* Are waiting longer to marry, to have children, and are having fewer children.

* Are witnessing many in their parents generation going broke because of housing debt.

* Have just witnessed a huge drop in home prices.

* Are about to witness years of (at best) stagnant prices.

* Have seen high gas prices for much of their driving lifetime, and have two career households. They recognize the high cost of commuting from the ‘burbs on their pocketbook and the environment.

The “renting is throwing money away” meme is dead, “buy now or be priced out forever” is dead, “debt is equity” is dead, “drive ’till you qualify” is dying. It’s not the demographics of this generation that matter, its the economics. J.L.Scott is right about one thing: there’s a huge lack of homes affordable to this generation. They will force the price-to-rent ratio back to historical norms by choosing to rent (or having their paycheck choose for them).

Why do you think they are attacking the article?

When discussing the echo boomers, was any mention made of the enormous sums of student loan debt this generation is accumulating?

Hah, of course there wasn’t. It was part of Lennox’s pep talk.

Today though Spencer Rascoff brought up Lennox’s “echo boom” theory, and he was skeptical of it because he thinks the cliché of “renting is throwing away money” is being questioned a lot more by people in their teens and twenties. I think Spencer’s got a good point.

When discussing the echo boomers, was any mention made of the enormous sums of student loan debt this generation is accumulating? Young couples now have to dig themselves out of $50,000 in student loan debt before they can start saving for a down payment. (Plus the average of $9,000 in credit card debt per individual aged 18-34.) Surely that’s going to impact what they can afford in housing.

Nonsense! JLS has an even better, even more historic opportunity planned for the April 30th through May 31st period.

But rest assured, he and his friends are saving the best for June and July. You have to ask yourself- and answer truthfully- just how much awesomeness can you handle?

I frequent lending/mortgage blogs from time to time and there seems to be and undercurrent that these blossomed up to circumvent the HVCC regs. At minimum it appears they are formed to keep somewhat of control over the choice of appraisers who could be called to do an appraisal ordered by a mortgage broker or other lending company (such as correspondents or other structures). I can certainly understand the use of an appraiser with a long history of appraising in a specific area vs. one that is asked to appraise in an area rarely ventured into.

I still hear stories of appraisals that are frustrating LO’s and agents and that they sometimes turn to secondary appraisals to help make a transaction come to fruition. I also hear of secondary appraisals ordered by lenders quite frequently for one thing or another in underwriting.

Bertolin wasn’t suggesting that at all. He was helping us understand that when the savings rate goes up, that’s good because households need to repair their balance sheets, but the consequence of higher savings rates means a damper on consumer spending. He was not pumping the crowd to go buy houses at all.

From the JLS Blog:

“The moral of the story is that as long as your clients buy a home by the April 30 deadline, their purchasing power is at an all time premium. This is a historic opportunity; donâ��t keep it a secret!”

I knew it! It’s a great time to buy a house!

It ain’t just a great time to buy a house, it’s a historic opportunity. You’ll make so much danged money off the value of that house, if you take advantage of this historic opportunity, that you’ll be bathing in cash. But all bets are off if you don’t buy before the end of April. If you wait until May 1st you may very well have squandered a historic opportunity. You might have a cursed life if you don’t buy before the end of April. A plague of locusts, perhaps.

“I was told to keep this positive….”

“I was told to keep this positive…”

I found it interesting that the presenters would open their discussion with that premise because it made me, as an audience member wonder what they were NOT saying but wanted to say.

I’m with you. If we didn’t have HVCC we’d still have people pressuring appraisers to bring in higher values on resales and LOWER values on short sale transactions.

I asked Marc Savitt a good question during the breakout sessions: If we didn’t have HVCC, then what would keep loan originators from pressuring appraisers in today’s market?

He said it’s not just loan originators that pressure appraisers, it’s real estate agents along with the homeowners themselves.

His idea was to have every person sign a statement that he/she did not pressure the appraiser to influence the home value. I thought that was a nice idea because it includes everyone, not just the loan originators.

Tim,
What a great day of industry presenters with important information regarding the Pacific NW real estate markets.

Grape or cherry?

Where is your 500 Realty T Shirt? I should have given you the keys to the Bush mobile and then you could have parked it directly outside this event.

Dang………..

My analysis is what you already knew going there. A buttload of Monday Morning quarterbacks. They are all in the same van cruising around, not knowing WHERE AND WHEN, the van is gonna stop.

However, the one person I always do like to listen to is Spencer with Zillow.

” It’s a deal then, Ellis. Fifty dollars for that mane of hair, and a 2% commission on your internal organs.”

That’s the Tim Ellis-Lennox Scott caption.

Consumers need to be very aware that they are paying a huge price for this marketing.

You should be aware that the Real Estate industry is creating more products than housing units. Banks used to be the enemy. In the past you wanted the banks out of your home by paying off the mortgage. Today the banks have a vested interest, and the Real Estate industry has a vested interest, in keeping the refinance, new mortgage business churning.

This summit was about how to keep the consumer paying more. This was an industry pep talk.

But to be fair, if I were selling cans of crap I’d tell everyone it tasted just like caviar.

There is this annoying power of positive thinking that permeates the Real Estate sales business.

Literally, a Broker can be out of pocket $5K a month, have his car repossesed, down size from the house he is renting to an apartment, and tell you how great everything is going, two years after his last bankruptcy.

LOL. Once in court I heard someone explain that commercial fishermen tend to be an overly-optimistic group of people. I often compare selling a house to fishing. Perhaps there’s a connection there, and a reason why agents tend to be optimistic? ;-)

The rent is falling!

The article is okay, but I was more interested in the reactions to it, and it sounds like a lot of people resent prices falling. I’m not sure why; well, I have my theories (high housing costs make people feel rich), but this is what I heard 2 years ago in LA: “it’s different here,” “Yeah, but we have ____ (enter corporate behemoth here)” or “things may come down a little, but they’ll shoot right back up”. Then, my favorite quote from the article: “… he believed the market – at least in Seattle – appears to have hit bottom and is stabilizing.”

No it’s not, so what, no they won’t, and my favorite response to people who pull predictions out of their @$$#$ “based on what?”

Seattle, you have a lot to learn.

People made billions in the 89-92 financial crisis and they’re doing the same thing now, only in trillions.

It was nice to meet you at the PNWHS and put a face to your website. What a great day of industry presenters with important information regarding the Pacific NW real estate markets. I thought Spencer Rascoff from Zillow did a great presentation. I knew that the consumer desired quick response times to inquiries, 36% want a response instantly and 16% in less than 30 minutes! So 50% of consumers want their info now! I guess I shouldn’t be surpised, as I’m no different! I thought that was a great survey.

Come on. Let’s not get all crazy here.