bostonbubble.com

[melonrightcoast]

Although we are not actively looking to buy right now, I am still following the housing market closely and have e-mails sent for properties that fall into our parameters. Typically, after checking location, condition and style of the house, I have not been interested in any of the new listings for a few months.

Today was an exception, as a new listing came on that I was impressed with and I decided to call the listing agent. She said that the house had been on the market since last week, it had two offers and the sellers just accepted one of them. Meanwhile, I just received notice today that the property was listed. I am annoyed for several reasons, one of which is that I am wondering if this "delay" in the listing was intentional in order to force buyers to work with agents. This certainly does not help the sellers.

Has anyone else experienced this "delay"? It was about a 5 day delay from when it was listed to when it showed up on nemoves.com. Because of this, I am going to abandon nemoves.com and go with zip.

There will be other houses that I'm interested in, but this is annoying.
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melonrightcoast ... are you?

[john p]

You can sign up with an agent to get MLS updates. I asked my realtor back in 2006 to continue to give me the MLS updates so I can continue to track my price point and market. I think the websites you're talking about get their information from the MLS and perhaps need a day or so to do their updates?

Basically, you ask a realtor to give you the updates and you give them the price range, basic specs, and list of towns and anything that comes into that range you get e-mail notifications. I would imagine a realtor might want you to commit to working with them for them to give you this service, however.

What you described was an ability to pick winners. That is a huge accomplishment that comes from steady research.

[melonrightcoast]

[Brian C]

Get a good buyers agent. Let them provide the good tools.

Make sure they give you access to MLSPIN.

Every 60 seconds my parameters screen would update. It was interesting watching stuff come on for maybe a few hours then be inactive (which I think is done by the realtor to lower their DOM score).

Every morning, I was sent daily updates on new stuff but even then, it could be already inactive. It would even tag listings that were "looking for other offers"

Zip isn't bad, would get my updates a few days after they would show up on the market but very quick on inactive updates.[/i]

[john p]

as far as "picking winners" If the stuff that you see is a "good deal" is also selling quickly, you're picking winners. This isn't to say that sometimes a good deal doesn't sit a little while, but on the whole, if there are informed buyers out there, when that one or two homes hit the market, they get snatched up. When you get the ability to detect these it will give you some comfort in your final purchase in my opinion.

I remember when I couldn't tell a good deal from a bad one. Once I was able to detect a good price with some consistency and "pick winners", I felt more comfortable with my decisions... I think this is the point when you're "ready" as far as understanding the market.

[melonrightcoast]

john p: i'd have to agree with you about "picking winners". it certainly isn't rocket science, though. it is pretty much all 3+ bed/1.5+bath SFH over 1500sq ft, and priced under $450K. Assuming it isn't on a busy street, a split-entry, or it doesn't have a garage, or it is in poor condition, it will go UA within a week, often a bit over asking.

What this tells me is that the price is key, and that the government has succeeded in putting a "bottom" to the market with the conforming loan limits remaining at $417K. At least, in my town .

Brian C.: i'll think about getting a buyers agent when I'm more serious about buying ... we just moved a couple of months ago, and I don't think I could handle moving again before January. But honestly, I don't like having to have one, as I see it as an industry that desperately needs to change. If I do get a buyers agent, I'd probably go with Redfin. We'll see if the "buying fever" takes hold this winter like it did last winter lol!
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melonrightcoast ... are you?

[melonrightcoast]

john p: what I mean be agreeing with you about picking winners is the part about understanding the market. my issue right now is that what is driving this market is people's ability to get relatively cheap (i.e. artificially depressed interest rates) money for mortgages up to $417K. Once that relatively cheap money goes away (i.e. higher interest rates or feds lowering conforming limit) or demand drops off due to higher unemployment and foreclosure rates, then the artificial bottom will also drop.

So, while I would agree that when I purchased the home I would understand that for the CURRENT market, that I would be happy with the price that I paid, I also understand that the current market is being propped up by various government programs, which I am inherently uneasy about. And also why we decided to rent and not actively look.

I'm certainly not less obsessed about real estate, though .
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melonrightcoast ... are you?

[john p]

I get your concept about the artificial floor being held up by low mortgage rates.

I'd think of it this way, what isn't artificial is the MONTHLY PAYMENT. Sure, if mortgage rates go up, prices will go down. If you're in a position where you can have a substantial down payment, waiting for house prices to drop is the best scenario, but if you're putting a small amount down, it matters less. Sure, one could argue that the lowest price is the best regardless because you can always refinance if rates lower, but keep in mind that mortgage rates are very unpredictable and with all this government intervention it is hard to gamble.

From what I've gathered, a monthly hurdle height (mortgage payment) seems to grow pretty incrementally year over year and the ingredients of principal or interest change within. This has been eroding because five to ten years ago people were able to have more of a down payment due to a sale of a condo that they had unloaded giving them more for a down payment on the next place... The younger buyers don't have these down payments and are more financially bonded with student loans...

[admin]

[GenXer]

The less you have invested, the easier it is to just walk away. If you own the house with no loan (however you got there), you bear all of the risks of price declines, especially given that most people have to move. At 20% downpayment, you have enough skin in the game so that a big downward move in prices can hurt you very badly especially when you have to sell (and you can't just walk away from that). So in other words, if you could get a '0 down' loan, that would probably be the smallest risk (that is, even if you had the 100% cash to pay for the house). Or you can rent, as this has absolutely the lowest risk.

The unemployment is not high enough to make a dent yet. I wouldn't be jumping up and down about the government's ability to stabilize anything. Recession has only just begun, and if we do get a recovery (despite all of the crazy stuff done by the government), it would be a miracle. Unemployment benefits are now 2 years long, so it could be another two years for most people to lose their benefits. Then the unemployment rate would fall to 0, based on the government's funny math. This is where all the real selling may begin.

[admin]

[john p]

This is a great mix of perspectives. You have one guy talking about the way it should be, one guy talking about the way most people look at it, and one guy talking about how to play the game without having skin in the game.

The way it should be is the way Admin described: assume you'll be responsible, get the house for the lowest possible price, that way if mortgage rates drop and prices go up, you can get home appreciation. The reality to this is that presumably, you'll go to another place that house most likely went up in price as well so it's kind of relative. Also, you might be waiting a while because mortgage rates don't go up and down from 13% to 5% in a three or four window so unless you've got a decade to wait, unless you've got some good data to point to inflation in the near horizon, you might be waiting a while. The flip side is that many economists are now talking about hyperinflation. Although I feel that our debt would warrant such a readjustment in our currency, much of the world is in the same boat and if China did call their notes it would limit the amount they could export to their best customer (US).

The way most people look at it is the way I described. I believe the majority of people look at their monthly payment and that sets their affordability reach height. Most people don't forecast mortgage rates and the risks associated with that they just reach to the height that they can. I'm not saying follow the herd, I'm just saying that you have to assume that herd behavior is a reality so it is important to factor that.

The way to game the system with out getting skin in the game is the way that Gen-Xer described. I think that the much of the herd had little skin in the game, not that they were playing it this way, but year after year after year, people had less and less savings so down payments dwindled and by default they had little skin in the game so they based their next set of decisions with that condition and you get a second layer of irresponsibility. Keep in mind that the people in power are left wing liberals and they rationalize even criminal behavior on environmental factors and make excuses for murderers and rapists saying that the bad environment made these people do it. You have all these deadbeats blaming the banks or the rich for their own self created financial problems and you have all the politicians blaming George W. Bush for their inability to pay their mortgage or because their adjustable rate mortgage set too high. I mean listen to a Chris Rock bit, he blames Republicans for adjustable rate mortgages and sees people who signed up for them as victims. The truth to this argument is that the economic deformation did occur by people acting irresponsibly and if you don't act irresponsibly you're handicapping yourself in this environment.

I think you need to be as innocent as a dove and as wise as a serpent. I think that if you can make a reasonable play to be responsible and play within historical fundamental benchmarks, that's the way you ought to play it. Further, I think you can insulate yourself at most times by finding that incredible deal. According to Zillow, since I bought my house on 8/30/06, my house dropped 2.8% while Massachusetts dropped 19%. Sometimes that incredible deal is out there when nobody is looking.

Lastly, things are so turbulent, even experts aren’t really confident so you have to determine your own path.

[admin]

[GenXer]

admin: I don't disagree with you. I'm merely stating the obvous approch to limit risk. I'm not saying that this is an ethical thing to do. I wouldn't do it, but many people would.

You are right that higher interest rates are best to buy (the higher the better). The fed may not want to raise them for years. This will prolong the current housing downturn indedfinitely (or until such time that the prices come down and rates come up, in whichever order that happens).

[john p]

Admin said: