Free Real Estate Market, meet Dr. I Told You So

Dr. I Told You So: What seems to be the problem today, Free Market

Free Market: I’m  just exhausted, Doc.

I Told You So: Really? Tell me why.

Free Market: Well, every time I try to do my job, something, or someone, interferes with me.

I Told You So: Didn’t we have this conversation about 10 years ago?

Free Market: Yes, when a bunch of meddlers forced me to loan money to people who would never have been approved for a loan, had they let me do my job. 

I Told You So:  So, how has it gone since then?

Free Market: Well, I hit my head real hard when I fell of the cliff. Since then they have been trying to put me on disability, thinking that I am no longer capable of doing my job.

I Told You So: Let me get this right, they attempted to disable you, Free Market.

Free Market: Yes.

I Told You So: Didn’t I tell you that there is no way to disable you? That the only way to stop you is to take you over?

Free Market: Yes, but how come nobody else seems to understand this?

I Told You So: Who is nobody?Free Market: Well, Let’s see. Congress, The California Legislature, The National Association of REALTORS, the California Association of REALTORS and many individual REALTORS that I am around.

I Told You So: What did they do to you?

Free Market: There I was trying to recover from my fall, barely starting to feel like my old self again when all of a sudden I was told I wasn’t  working fast enough and then they held me down and injected me with something they called stimulus.

I Told You So: Are you saying what I think you are saying.

Free Market: Yes, they injected me with the leftover Cash from Clunkers serum.

I Told You So: Oh no. No wonder you are exhausted.

Free Market: Yeah, as soon as they injected me I started running around feeling stronger that I have in the past three years. Everybody thought I was finally healing.

I Told You So: Not everybody.

Free Market: Huh?

I Told You So: Didn’t I tell you that if they tried the Cash for Clunkers medicine on you that it would not work. That it would only temporarily interrupt you, Free Market, from doing what you do.

Free Market: Yes.

I Told You So: So how is it going now.

Free Market: I am now going through withdrawals. I have come off my high and now everybody is saying that I am tanking again. And I think I am. Existing home sales are down almost 30% and new home sales are down over 12%.

I Told You So: Don’t panic about this! Sales are down now because of the high they put on you with that market interferce drug called “Tax Credit.” Now that the drug has worn off you have the chance to do the job you were established to do. But you have to carry the temporary burden of being looked down upon for going where you were already going before you were assaulted.

Free Market: Boy, am I glad to hear THAT.

I Told You So: Always remember this, Free Market. You are much like a mail carrier. Neither rain nor sleet, nor government or trade group interference, can keep you from your appointed duties.

Free Market: Thanks Doc.

I Told You So: You’re welcome.  Now get out there and get that Supply and Demand thing going again!!! Oh, and that will be $300.00. You can pay my receptionist on the way out.

Free Market: Gee thanks, I guess the Free Market IS back.

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For example, the Super Bowl Indicator theorizes that the year in which a team from the AFC wins the Super Bowl the stock market will fall, but if an NFC team wins the market will rally. Amazingly, this “predictor” has been right 80% of the time over the years. Another of these anecdotal predictors is the Hem Line Effect. This theory says that as hem lines move up so does the market and when hem lines get longer the market drops.

So, what does this have to do with anything related to the real estate market in Lake Oroville, Paradise and Chico, you say?

As to those theories, nothing. But I think we unintentionally swerved into the first real estate industry anecdotal predictor of the real estate market, in our office. I call it the Redenbacher Effect.

I discovered this theory while Steffan, one of the associates in my office was popping his $1.00 bag of popcorn ( that he bought at the Dollar Store, because that is where REALTORS® shop these days) in our microwave oven. You might imagine the quality level of $1.00 popcorn is not quite the same as the good stuff you get at the movies for about $5.00 a bag.  The fact that Steffan eats at least a bag a day of this stuff has leads me to believe that he is quite the popcorn connoisseur.

I will never forget the profoundness of the words that eminated from his lips as the Redenbacher Effect was born:

 ”I sure will be glad when the market gets good again so I can afford to buy something better than this $1.00 popcorn c*@p.”

With the suddenness of a light bulb being switched on to interrupt the darkness of an empty room, it hit me that we may finally have an accurate way to forecast the pending direction of  not only the Lake Oroville real estate market, but the real estate markets of all 4 corners of the world!

The Redenbacher Effect is defined as this:

When Steffan is eating $1.00 popcorn c*@p the real estate market is c*@p. When he starts buying more expensive popcorn (i.e. Orville Redenbacher Movie popcorn) the market is going to improve.

Now you might be thinking that I have finally lost it, and actually, you may be right.  But just think about how well (or not so well) the so-called experts have predicted the direction of this market. I mean, really, can this be any less accurate than the methods they use. I think not.

There is, however, one thing that can throw this whole theory into a tailspin.  What happens when someone GIVES us a box of premium popcorn. For example, I was telling my friend Jim Moll about my theory yesterday and when I arrived at the office this morning there was a box of Orville Redenbacher popcorn at my backdoor.

It took me a while to consider the consequences of his generosity. What will happen if we eat this premium popcorn while the market is down like it is?  Will the market improve even though Steffan did not pay for it? The respective answers are, NOTHING, and NO.

You see it occurred to me that Jim’s gift was a POPCORN CREDIT. He was simply giving us popcorn in the hopes that it would give the market time to stabilize so that we can buy the better and more expensive popcorn later. So we have had the CASH FOR CLUNKERS credit, the FUNDS FOR FORECLOSURES credit and now we have CORN FOR C*@P credit.

I wonder if this will work better than the previous credits?……I think we all know the answer to that one hmmmmmm.

Stay tuned to this blog post for updates on the Redenbacher Effect. And remember, you first heard about it here.

I have just rolled out the Droid edition of this app and it is now available for download. I have also made some recent changes to the features of the app by adding mapping of area schools, and providing the ability to search for properties directly from my website.

After downloading the app, simply enter my Agent Id on the first page. The Id number is 5303704691.

With coming upgrades and the addition of more features it is my goal to make this the only real estate app you will ever need. Coming next is the Blackberry version of the app. It should be launching sometime within the next month. Of course you will hear it first here.

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Late last week I showed a home to a first time home buyer in the Lake Oroville real estate market. She liked the house enough to make an offer on it last Saturday evening  through the online bidding process that the seller had established.  No paper offer to write and no signature needed when submitting our bid.  I simply discussed the offer terms with the buyer and from my desk and computer  in my home office I entered the online bid.

Come Monday morning I received an e-mail, on my iPhone, at about 6:30 am informing me that the seller had responded to the offer by sending us a counter offer. I immediately called the buyer, discussed the counter offer and decided to submit a counter offer to the seller’s counter offer.

I submitted the new terms to the seller. After about an half hour I received another e-mail letting me know that the seller had accepted our new terms. I promptly called my buyer to inform her of the good news.  After congratulating her and discussing the next steps in the process, I ended the call and hung up the phone.

It was then that it hit me.

I was sitting there in front of my computer screen, in the privacy of my home office, negotiating, and getting an acceptance on, a contract for my Lake Oroville real estate first time home buyer, IN MY UNDERWEAR!!!

Not only can you now do a lot of your real estate business from home,  you can even do some of it in your tighty whities.

Ok, so now you think I am some kind of nut case. Heck, you might be right. It  just happened to be one of those things that brought to mind how quickly this industry is evolving. Probably should not have gone off my medication!!!! LOL

Is this technology thing terrific or what.

Today I am announcing the launch of my very own iPhone app that is now available for download at the App Store. With this highly sophisticated, but easy to use, app you now have not only my contact information in the palm of your hand but you can now access all the services of my blog site with just the touch of a button. No more addresses to remember and no more passwords to forget. This is just another investment I am making for you in order to provide a service, that nobody else in the Lake Oroville real estate market will,  in order to make current and relevant real estate information readily available to you.

See my current listings, check out my latest blog post, or even find my Facebook, Twitter, and Linked-In pages. Spend as much, or a little time as your prefer because there is NO COST to you to download this App. Check back often, though because updates and come cool additions are coming soon.

And unlike many of today’s apps this app will be compatible with Blackberry and Droid users. Look for the rollout annoucement for these phones on the site sometime before Labor Day.

Download your app at the iTunes App store and search for AgentNTouch. After downloading, launch the app and in the Agent I.D. box enter 5303704691.

I would greatly appreciate your feedback and suggestions. My goal is to always be an AgentNTouch.

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Attempting to take into consideration all the factors that affect the market and trying to provide accurate guidance into the future is a balancing act to say the least. The biggest challenge in trying to do this is in separating the hype from reality.

Every day you hear the hype but rarely the reality.

I think the reason this Lake Oroville real estate blog is so popular is that readers have realized that the perspective and advice I give is based solely what I see the realities of the market to be. For example, if you go back to some of my previous blog posts you will see that I was maybe the only REALTOR you heard saying that the tax credits would not help the market in the long term; that the market cannot recover until we find a way to get some of the 8 million or so who have been foreclosed on back into the market; and that government “purchase incentives” will only prolong the pain homeowners and sellers are going through with regards to home values.

My contact with two separate buyers in the Lake Oroville real estate market over the past couple of weeks has led me to believe that we are about to see the very small beginnings of a truly sustainable recovery in home sales and home values.

This belief is based on the fact that each of these buyers were coming to me following their homes being foreclosed upon in late 2007 and early 2008.  With FHA lending standards allowing a borrower to get a loan with a foreclosure of 3 or more years old on their credit report, these buyers are poised to get back into the market and find another home to purchase.

With the first big wave of foreclosures rolling through the real estate market in 2008 it stands to reason that there should be the beginnings of an uptick in real estate transactions sometime in the middle of 2011 as many of those who lost their homes may possibly qualify again for a loan.

And as corny as this may sound, with the much lower prices and the almost free, fixed interest rates, many of these buyers may look back on their foreclosure with fond memories as it enabled them to get out of a house they most likely over paid for and which they financed with an adjustable loan with a top rate that would make a loan shark blush.

Time is a great healer, isn’t it?

(June 29, 2010)—The United States House of Representatives has just passed HR 5623, the Homebuyer Assistance and Improvement Act of 2010, by a vote of 409-5. This bill extends the deadline for closing tax credit eligible transactions from June 30 to September 30, 2010. The bill moves to the Senate where the outcome is much less certain. I will continue to update you as the events move forward.

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The bill, H.R. 4123, included an amendment allowing home buyers the three-month extension on the tax credit. The extension, though, only applied to buyers who signed purchasing contracts before the original April 30 deadline.

With a backlog of transactions waiting to be processed, and in danger of not closing by the required deadline of June 30, 2010,  the National Association of REALTORS®, as well a mortgage lender groups, had urged Congress to extend the time for escrow closings to the proposed September time frame.

Unfortunately for those of you in the Lake Oroville real estate market and the Paradise real estate market in danger of not closing your transaction on time, the provision for the extension was added as an aside to an unemployment bill that had become a political hot potato.

Why Congress can’t do the common sense thing, (oh wait, my English teacher told me never to use the words Congress and common sense in the same sentence), and vote on these unrelated issue separately is beyond me.

If you are in danger of missing this deadline you might want to turn up the heat on your loan officer, as loan processors and underwriters could really care less about your time frame

There is still an outside chance that this extension amendment and be added to another bill or simply be voted on on its own merits. My advise though is don’t assume anything.

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But, wait!! I thought the government’ s tax credit program was supposed to stabilize the market. If you listened to, and believed what,  the National Association of REALTORS® and the California Association of REALTORS® have had to say about the credits, you should be seeing a recovery by now. But, what we are beginning to see, on a National basis, (which is what most of us read and hear about) is a rapid move of the market toward the place it would have already gone,if  the people who should know better would have been honest about the ultimate impact of these credits they were supporting.

Instead these groups landed on the side of  getting a quick “fix” instead of thinking long term. Now we have to look even longer term because the inevitable has been prolonged.

Now let’s be honest here. I and my office associates, here in the Lake Oroville and Paradise real estate markets,  no doubt benefited from the temporary increase in sales that resulted from the credits. Our sales numbers increased like everyone else’s.  I would, however, have gladly sacrificed the short term benefits in order to re-establish a viable, vibrant and free real estate market. One that has staying power.

As it is we are saddled with the hangover from the housing version of  Cash For Clunkers, or as I prefer to call it:  “Funds For Foreclosures”

If you think that I am all gloomy and doomy about this market you are wrong. I think that expiration of these tax credits now allow us to come back to reality and now focus on the real cause of this market today. UNEMPLOYMENT!!!!!!!!!!!!!!!!

Maybe a softer real estate market going into election season will be one more reason to finally get us the changes we need in order to get  our country’s, and our state’s, economic engine restarted.

As they say, Everything Happens for A Reason.

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What’s that you ask? Where have I been?

If you must know, I have been in the same place I have been since the beginning of this blog. In my Lake Oroville Real estateoffice; attending to the needs of my clients; brushing up on the lastest real trends, expanding my knowledge through a couple of certification programs that allow me to be of even more help to those struggling with their home mortgages; and spending a little more quality time with family and friends.

What I haven’t been doing, as I am sure you have noticed, is blogging. It seems that I have a ton of ideas of which to write about, but I have just simply been unable to sit down and do it. I feel like I have had “blogger’s block.”  If you have never heard of this debilitating ailment before it is because I just made it up and am sure that I am the first to suffer from it. I am sure though that the cost to treat this disease will be covered under the new national health care plan!!!!

A few of my Facebook friends and I were joking around during the peak of my blogging activity one day and the word “blogarrhea” was used to describe my prolific blog postings. Now however, it seems that I have been suffering from “blogstipation.”  

No longer though. Today I am taking control of this disease and will no longer let it deny you the opportunity to once again read the most relevant real estate news and advice of the day. It is true, I have a lot of work to do to catch up. But I am undaunted by the tasks that lie ahead.  Beginning today I am back, and I thank you for your loyalty to me and this blogsite.

Now……..back to work!!!!!!!!!!!!!!!!!!!!