Guy’s February sales report showed "equity sales" representing 26% of all sales. An equity sale is defined as basically not a short sale or REO. It includes sellers who actually have equity in their properties, or those who bring cash to the table at closing (CTT on the spreadsheet). I was able to track 85 of the 87 equity sales Guy reported:
– 7 were builder sales, just listed on the MLS.
– 15 were properties being resold after a Trustee’s Deeds to private parties (NRES, Wood is Good).
– 2 were flips after REO sales.
So at least a quarter of the "equity sales" are either tainted or are MLS aberrations. You can run your own percentages, but true organic sales are far less that 26%, and correspondingly distressed sales are higher than 74%.
Median sales price for this group was $220,000. I thought that the true organic sales might be higher.
Here’s the chart. I’m guessing on some of the equity sales as I haven’t thoroughly vetted all the loans involved, but it gets us into the ballpark.
But what really stunned me was in the "terms" column. 25 of the 85 sales were for cash (plus 28 conventional, 25 FHA, and 7 VA). CASH buyers in our distressed market. Are they lemmings or lions?
Guy and I joke about the inverse relationship between the time we put into researching a post and the number of comments received.
This one was a huge slog for me, and i hope you find it interesting enough to comment on.
Sully
skeptical, I’m not predicting as my crystal ball got a short in it a few years ago. I’m projecting, on the basis of the 1929 Dow.
So – the stock market will begin to fall and wipe out all the gains of the recent bull (back to Mar/09 level).
Real estate in this region will most likely continue flat.
Employment will follow the chart, that Don posted, or stay somewhat stable at current rate. The chart was based on national corporate profits and employment. Nevada is hardly a representative of the national scene.
Until I see (or rather hear) some buzz in and about Silicon Valley as to new hirings, I will remain very cautious about a recovery taking place.
Especially watching the coming Nov elections. If, democrats lose the projected number of seats (50) in the house, then Pelosi (top elf to santa) will be out as speaker and no longer able to control the direction of govt.
This could be a game changer, regardless of what happens in the senate.
As I said, its a projection rather than a prediction.
skeptical
BB,
You are correct. The recent homebuyers on the blog are being intellectually lazy about this. Their standard arguments are:
1) it’s always darkest before dawn
2) show me a negative stat, and I’ll show you a contrary indicator
3) the permabears are just singing the same old sad song
4) in 20 years everything will be all right forever
5) I just bought my house, so it must be a good time to buy. Prices are only going up from here.
What they are ignoring are unprecedented (meaning NEVER before experienced) headwinds:
1) The greatest economic cataclysm since the Great Depression
2) Unprecedented unemployment rates
3) Still overpriced real estat left over from the bubble days
4) unprecedented inventory on the books, including the 10k shadow inventory
5) the massive gravity on prices induced by 80% distressed sales.
When confronted with these issues, though, all they can say is that some folks on this site are just always gonna be pessimistic.
To which I say, I’d rather confront the cold, hard reality than live in lala land and get my butt handed to me. Nobody’s gonna lose anything by renting for another few years.
FWIW.
Calinda
I work in a small office in Reno. There are 6 other people besides me who work together.
One is a 50ish woman, divorced, who bought her house in 2007. She is upside down in her house about $120K. She bought with zero down and so has no real skin in the game, other than her diminishing sense of obligation. More and more she talks about walking away and going back to her home in Canada.
One is a young woman, about 30, married, who bought in 2006 and pretty much nailed the top of the bubble. She and her husband are so far upside down they stopped paying the mortgage 7 months ago. Still no default notice from the bank. They plan to stay until they have to leave but have no real desire to keep the house.
One is a man who is 62. His primary residence is bought and paid for. But he bought a house in Fernley in 2007 as an investment/rental. He paid about $180K or so. Houses on the street are listed today for $70K. He has stopped paying the mortgage and just wants to get rid of it.
One is a woman also about 60 who with her husband owns 4 houses in Reno, all bought before 1990, and all paid for. She is fine.
One is a woman about 50 who got her house in the divorce about 10 years ago. But from 2003 to 2006 she refinanced 3 times taking all cash out every time. Today she is about $150K upside down.
The last guy is about 60 who bought his house in 1990 has paid off the mortgage. He paid no attention to the inflating bubble, and now is paying no attention to the imploding bubble.
We work for a governmental agency. By July 1, some or all of us may be unemployed. The rumors are flying, but nobody knows anything for sure.
Now I know that this is not a big sample of Reno. But if things in other work places are like they are in mine, this economy is one hell of a lot worse off than most people on this blog realize.
FWIW.
Sane Economist
Thanks Calinda .Nice to hear about on the ground situations.
Caputo
re the state of the economy.
I too have a co-worker who is upside down. Of course, when we consider that 60% of all mortgageholders in Reno are upside down, I guess that is not so unusual.
Last week we were coming back from lunch and were talking about her situation as we were standing on the corner waiting for the light to change. I said to her that she was not alone in that situation. There were 2 other people standing there with us. When they overheard me say that, they BOTH said they too were underwater in their houses. One said he and his wife were going to stop paying the mortgage to save money because he was afraid he was going to get let go soon.
I know this is no scientific survey, and will probably be dismissed as meaningless. It does though support what Calinda said.
skeptical
Thanks to Calinda and Caputo. This is the tragic devastation that bubbles cause, and it’s why they must be avoided at all costs. This is the mess that Greenspan created.
A contributor a few days back (DonC?) was cheering the advances to society as a result of bubbles. Well, tell that the Calinda’s coworkers and the tens of thousands in Reno like her.
I think the bottom callers on the site are just spouting and in their own little worlds. Perhaps they should take a few surveys at their workplaces. Ah, but then again, perhaps they don’t need to work for a living….
Empathy to the families out there that are severely underwater and fear for their jobs. This must be among the most trying of times.
Clarence
2,133 NODs recorded ytd. It appears this fact is irrelevant to the bottom callers.
MikeZ
RE: “Purchasing a house in a deflationary environment is not wise. Your debt gets more expensive by the day as houses continue to fall in price.”
The deflation argument is flawed.
Yes, fixed debt becomes relatively more expensive but variable debt becomes relatively less expensive and if home prices fall at the rate of deflation, that would result in constant relative value.
Inflationary and deflationary periods have their own characteristics and neither is necessarily a bad or unwise time to buy a house or take a mortgage.
dman
how is it that all these broken down apartments are being sold as condos now?
these places were apartment buildings for YEARS and now in the last few years they are all the sudden considered condo’s?
I wonder what the combined median price would be if we didn’t count these apartment sales as condo sales..
perhaps we could come up with a new median for apartment sales?
dman
Seems to me a large % of the “condos” for sale in the 40K< range
were actually apartment buildings before the great boom of 2002-2005.
DonC
skeptical says “A contributor a few days back (DonC?) was cheering the advances to society as a result of bubbles.”
Not me actually but I understand the point, which is that while a lot of money is lost a bubble can provide real tangible benefits. For example, recently Spain greatly over invested in solar production. The result was a bubble and a nasty shakeout. But today, after the shakeout, Spain is the world’s leading producer of solar panels and the business is producing a lot of jobs — though only half as many as during the bubble.
That was the point that was being made. But I’m not sure if the same reasoning applies to financial bubbles or things like tulip bubbles. I’d have to think about that some more but my initial response is that these types of bubbles don’t really have the same silver lining that a bubble in infrastructure or new technologies has.
MikeZ
RE: “2,133 NODs recorded ytd. It appears this fact is irrelevant to the bottom callers.”
We may be using different defintions of “bottom.”
Bottom (to me) is when home prices stop depreciating.
NODs, unemployment, inflation/deflation, immigration/emigration, mortgage rates and even the weather may ultimately influence home prices but the only metric that actually matters is home price depreciation.
MikeZ
Sully: “Real estate in this region will most likely continue flat.”
Hence, a “bottom.”
DonC
BB says “DonC, no doubt, makes some statements which are quite confounding, but what really leaves me scratching my head is how he talks about “deleveraging”, and “deflation”, yet also talks about house prices increasing.”
Yes we’ve had deleveraging and that process is not over IMHO. But that doesn’t mean that all asset prices are going down. The stock market has definitely not gone down over the last year.
On deflation, I don’t think I said we’re in a deflationary period. I think what I said, or if I didn’t what I intended to say, is that the risks of deflation still seem greater than the risks of inflation so the Fed is not likely to tighten credit. A risk isn’t the same as the actual fact. Turned around a bit, there is a risk of inflation but very little inflation at the moment.
On housing prices, I’m not saying housing prices are going up. I have no idea what they’ll do, especially in the short run. What I’m saying is that, at current prices, the upside seems greater than the downside, so I’d be comfortable buying if I had a 5+ year horizon. The longer the horizon the more comfortable I’d be.
Keep in mind that tolerance for risk varies. Last year some people bought into the stock market and some got out — and they may all have made the right decision, though the buyers made out better financially than the sellers. If you’re going to buy and then worry yourself to death with second guesses you’re better off not buying, whether you’re buying houses or stocks or bonds or box cars.
DonC
SE says “The extent to which the govt. has involved itself in the current housing market is unprecedented. Never before has the govt. involved itself in altering existing mortgage contracts.”
Technically this isn’t exactly incorrect. For decades bankruptcy courts routinely rewrote mortgages. Also the Wagner-Steagall Housing Ac was a big intervention in the housing market. But no big deal, I understand your point.
But this “intervention” has been so ineffective you’d be hard put to it to claim it has affected the market much at all. So it doesn’t seem like it matters much if that action continues. For different reasons the same is true of the Fed buying MBS. In this case the exit will be very measured and is potentially reversible, which is probably why the markets don’t seem to be bothered by the possibility.
The one area where you may see some immediate effects of the government pulling back is with the tax credit for new home buyers. In CA for 2009 almost 50% of all buyers were first time home owners, and no doubt many of those buyers were animated by the $8K tax credit. That goes away this Spring so we’ll see what happens to this demographic. (Which is important since, as many have pointed out, the “move up” buyers are not going to be plentiful given that existing homeowners may have little if any equity in their houses).
Clarence
Way back at the beginning of this post RI made a very good point that seems to be lost in the discussion. He pointed out that what we have now is really two markets within the total market. MikeZ says the bottom arrives when prices stop depreciating. Fair enough. In one of the markets within the market, prices have probably stopped depreciating. I beleieve that most people here would agree (maybe not BB) that prices of Smithridge condos and 800 sq.ft. 25 year old houses in Cold Springs have stopped depreciating. Are Smithridge condos really going to drop below $40K? There is in all liklihood a bottom in that market within the market. However, who here seriously suggests that prices of 4500 sq. ft. Mcmansions in Arrowcreek have stopped depreciating. Are those houses going to stabilize at $900K to $ 1.3 million?
This is the problem with simply looking at the median and generalizing to the whole market. At the low end of the market, the bottom is likely in. At the top, end the bottom is a long way away.
smarten
I agree with Clarence and [again] make the points: 1) there are many different price strata [not just two] within the residential real estate market as a whole; and, 2) if you’re a buyer interested in purchasing an <$200K SFR, what difference does it make to you what’s going on in the McMansion strata of the marketplace?
Skeptical has suggested that if you’re a buyer set on purchasing a home in today’s residential housing marketplace, it’s O.K. as long as you knock the bejesus out of the seller’s asking price. The problem with this logic, IMO, is that one man’s bejesus is another’s delusion meaning that even if you’re successful insofar as the former is concerned, others will describe you as being an “idiot.” At what point does a price reduction become a bejesus, and is the number a moving target based upon the strata of the market you’re interested in?
I also pretty much agree with MikeZ’s observation that although “NODs, unemployment, inflation/deflation, immigration/emigration, mortgage rates and even the weather may ultimately influence home prices…the only metric that actually matters is home price depreciation.” In other words, it DOESN’T matter whether a sale is/not “distressed;” nor if it exceeds the average wage earner’s ability to afford the payments on a 80% LTV purchase money mortgage.
Unless you’re a renter sitting on a boat load of cash, I assure you that you WON’T be celebrating the carnage to the economy [of which you’re a part] should non-delusional housing prices tank from today’s levels. So if we’re all going down the toilet, perhaps it makes sense to sip a bit of champagne beforehand?
Sully
MikeZ, you’re twisting my words to say I’m calling a bottom. I am more in line with Clarence.
I took the Feb sales, deleted condo,townhouses, commercial etc – leaving SFR.
Took the list and cut it at 350K. Then came up with a 165,500 median for 350 and under. For the 351K and up the median was 500,000. Don’t know where you would like the line drawn, but there is certainly two markets here, one normal and one that mimicks San Jose. We very likely are flat in the lower market, but if Calinda is anywhere near correct for this area, then the upper market has a long ways down trip.
EdBear
A bunch of you are missing a point. Take a look at the current sales versus the last sales that were made in 2009. You’ll see that a LOT of money is being made by someone. Just look at the numbers.
I’ll ask again, anyone interested in ponying up $10 or $20K into a fund and taking a swing at some flips?
Let me know.
geopower
Sully,
I think what you’ve been saying about breaking the housing market into two halves makes sense to explain what has happened so far- the lower end has capitulated and seems to be relatively flat for the moment, and there are still a lot of delusional people with 900k mortgages pretending they can avoid short sales or foreclosures.
But what happens to the lower end market when the top finally does capitulate? When those 900k, 4000sf homes are listed at 450k, will anyone still pay 300k for a 3 bedroom on .15acres?
I see where people are coming from when they call the bottom for the lower end market, but won’t there be some further downward compression when the top end falls too?
As a renter looking to buy in that “top end of the bottom” price band, that’s definitely my worry.
geopower
WaPo story on the national shadow inventory- nearly 10% of mortgage holders nationwide are more than 3 months delinquent.
geopower
http://www.washingtonpost.com/wp-dyn/content/article/2010/03/11/AR2010031104866.html
DonC
I’m totally with Clarence and RI on the point that there are different markets. The lower end of the market(s), just about everywhere, has washed out. People who for one reason or another were in houses they couldn’t afford have taken a bath and walked, and new buyers have taken their place. I’m not sure that this process is complete, but it’s definitely getting there.
The upper end of the market(s)still has a lot of people who aren’t willing to “lose” money, where lose money is defined as recognizing the loss that they’ve already suffered. So unless they have to sell, owners in this bracket are holding on. Even the CA Realtor Association has recognized this phenomenon and has said that activity in this segment is low because property owners have “unrealistic” views on housing prices. (The CA report is interesting but proprietary so no link).
The problem is that so long as they hold on waiting for the market to recover you don’t have much of a real estate market. Sellers won’t sell at reasonable prices and buyers won’t buy at unreasonable prices. With the exception of the occasional case where someone has to sell, you don’t have any sales and the market just stagnates.
Sully
geopower, you bring up a good question. Using the list of cash buyers that Mike posted I found that the over 350 market was a median of 475.5K and the under was 226.6K.
Since the cash buyers have no further obligations (mortgage) is this list showing a willingness to buy within reason, or are we seeing a bunch of flippers in the low end and tired of waiting in the high end.
I’m thinking the low end may have more owner occupied than flippers, but have no clue as to the high end. But I think the cash buyers are setting the limits, as they more likely than not are in it for the duration.
Also, as smarten mentioned, jumbo loans are becoming more difficult which would put an additional burden on the high end sales that aren’t cash.
Maybe watching the cash sales as opposed to wishy washy 3% FHA loans says more then just a list of sales for the month?
CommercialLender
Anyone out there know of any lenders doing loans on fractional homes, such as 1/6th share Tahoe cabins?
John Newell
Don C,
You made many interesting points above, and I have enjoyed reading this discussion. However, I do not agree with you that we are nearing an end to the involuntary foreclosure storm.
You wrote, “People who for one reason or another were in houses they couldn’t afford have taken a bath and walked, and new buyers have taken their place. I’m not sure that this process is complete, but it’s definitely getting there.”
According to data I saw during a meeting I attended at the local HUD office nearly two years ago, that office had identified 2010 – 2012 as a time frame when a significant number of five-year ARM, Neg Am and interest only loans would reset or become due in the Reno/Sparks market. During the last two years, I have seen little to indicate that such home owners have had much opportunity to modify those situations between now and then (unless they strategically defaulted as a preemptive measure). The Fed may be able to hold interest rates low until all this shakes out, which may help some with five-year ARMs that are about to reset, but what about folks who in 2005 to 2007 purchased middle to upper end houses with five-year Neg Am or interest only loans? Barring in creative refinancing, many (most?) will become shorts sales or REOs, which will push all segments of the market lower (although, as pointed out many time before, median sales price will likely rise).
I agree that the low-end defaults may be winding down, but it likely will be at least two more years until we know how many people who bought at the height of the bubble can afford to wait out the storm.
dman
sorry ed.. I just allocated a handsome sum into some AAA muni bonds paying 4+%….
The returns I have experienced just in the finacial banks (GS,BCS,BAC,etc..) I felt it was best to put some of the profits into AAA muni’s for the time being..
of course im still long in the market and especially BCS which I bought quite a bit at 5/share.. but making gains aren’t going to be as easy as they have been the last year..
still possible.. just a lot harder!
dman
of course it wouldn’t hurt to buy some YUAN and hold for 2-3 years…. especially considering president Obama’s plan to basically devalue the dollar and double exports..
eventually Beijing will let the YUAN rise.. speculation is that it’s already 20-40% undervalued ..
cheers!
Dman
dman
maybe now Smarten knows why I sold my house and gain access to more liquidity?
DOW 6,500 was a GIFT! …
DonC
John — I was thinking about the lower end of the market specifically, but upon reflection I agree with your points. I was too influenced by thinking about the rate of change. While the rates of foreclosure are going down the actual number of foreclosures is still going up. So 2010 should see more foreclosures than 2009.
smarten
So is our dman really Derrick in stealth mode?
Yeah, sell your personal residence at a loss in order to access whatever equity remains so you can invest in muni bonds [remember WHOOPS?] paying a “handsome” return of 4% [NOT], and Chinese currency. Savvy move Derrick!
I’ll bet if you offered CL financing so he could make his fractionalized interest purchase of a Tahoe cabinette, he’d offer you more than 4%! And your “investment” would be secured by quality real estate.
Sam
Calinda, I agree on the state of the economy here. I moved here less than 6 months ago and have seen Chilis, Sports Authority, and that all-you-can eat sushi place in the Galleria area close. This was supposed to be the new growth area of town. Most would consider me to be a well paid professional and I was considering homes around the 300 range. But I too just got the pink slip. Within a few months I had some worries about that possibility and had thus held off on buying a home. Now I think I will have to move from the area because I truly realize how bad things are here.
DanS
Calinda, Caputo and Sam make valuable contributions. This blog is out of touch with Reno, for a couple of reasons. First, it appears many of the posters on the blog do not even live in Reno. They sit at their computers, analyze the data, and bring a nice cerebral analysis. They don’t go to the strip malls and see all the vacant spaces. They don’t see the restaurants closing down. They don’t have neighbors and friends who just got laid off. Second, this blog has a readership that is far above the daily experience of the average Renoite in terms of education, income level, and sophistication. This is not always bad, as it makes for often thoughtful and insightful conversation. But most of the people who post here have are better off financially that the average Reno resident. They don’t have a grasp on the precarious financial situation of the average Reno resident. they predict things that are far beyond the financial means of most Reno residents today. I am sure it is nice to be in a situation where all the talk of the struggling economy has only an academic aspect to it, but it causes them to be simply out of touch to the economic reality for many in this working class town. The map of Reno that is described on this blog is not what is actually present on the ground.
BanteringBear
Calinda, Sam, and DanS, as well as the recent unemployment report, provide irrefutable evidence that the housing crash in Reno is FAR from over. We’re merely in the middle innings, and speculation is what’s driving sales right now, especially on the lower end. What’s needed for a housing recovery is an economic turnaround in the way of well paying jobs, not speculators rushing in and driving up prices.
I have always maintained that housing will follow an economic recovery, not lead it, and I have not wavered from this. In the next few years, we will be reading the stories of people defaulting who purchased in 2009 and 2010, thinking the bottom was in.
BanteringBear
I just took a look at Mike’s chart and, WOW, talk about some serious knife catching. 1263 Mark Twain for $390k cash? WHAT?! I can almost guarantee you that those people based their decision on the previous bubble price, and not historical pricing- a BIG mistake. Those little houses were under $200k when this bubble started. The foolishness continues.
Sully
I finished my evaluation for the cash sales. Taking the 4 new houses and two condos out of the equation for lack of data.
The over 350K market paid 54% (median) of peak price, sawbucks skewed the data by 3% (it would be 51%). Sawbucks still has me pondering.
The under 350K market paid 51% (median) of peak price.
So, the cash buyers that are living in or using for rentals apparently are finding a place for their mattress money. I was not impressed with these percentages, as I thought 40% of peak would be more in line with current situations here (see DanS post above).
Sully
BTW, the house BB just mentioned was the 2nd worst purchase of the group (percentage wise) only fieldcreek beat it.
Irv
DanS noted:
…”They don’t go to the strip malls and see all the vacant spaces. They don’t see the restaurants closing down. They don’t have neighbors and friends who just got laid off.”…
–sounds like a description of our President and his inner circle of `Yes Men’ who are now running our country.
Gary
Good post, Mike. I guess you’ll have to be the final arbiter of whether the explosion of comments disproves your “inverse relationship” rule, or whether it’s the exception that proves the rule. As with real estate outlook, it can be spun either way, depending on your perspective.
I see from your chart that Mark Fox’s house finally sold, but he didn’t lose nearly as much as I expected, so maybe it shouldn’t count against his win/loss record 😉
DonC
CommercialLender – The more I think about your definition of market inflection points the more right it seems to be, albeit perhaps not exactly for the reasons you posit.
Hopefully we can agree that markets are not based on anything objective and are not always rational. In essence they are driven by the proverbial “animal spirits.” Basically a market direction is set by supply and demand, and while supply may be fixed in the short run demand is highly variable. With respect to housing in the current climate, if people decide to pull their money out from under their mattresses and buy houses then the market will move up. If they’re fearful and keep their money under their mattresses then the market will continue downward. It’s the old tug of war between fear and greed.
If you start with a market trend, meaning most people are either fearful or greedy, then as more people move from fearful to greedy or greedy to fearful you’ll get an inflection point. So yes, at the inflection points you’ll see a division of opinion. But it’s not so much that pundits are divided in their opinion. It’s that the opinions of the pundits are mirroring, or perhaps channeling, the thinking of many others’.
Steve Herschbach
Hi,
I do not get all the cash sales at above asking prices. This market is supposedly dead, but people are able to buy properties with cash at prices low enough they turn them for a quick buck?
I guess I’m puzzled as I thought it was more a case of people asking too much and having to entertain offers for less. Instead, properties are going to market and getting multiple offers within days above the asking price. Is it that the sellers are purposefully putting them out at a lower than normal price to attract a flurry of bids in what is in effect an auction?
Does anyone have an idea what the average spread is between asking prices and final selling price?
skeptical
Bottoms are not made when people have mixed emotions and bulls v. bears is 50/50. Tops might have a reasonable amount of debate.
Bottoms occur when people are absolutely disgusted and absolutely certain that there is no hope.
Look at the 1939 and 1981 stock markets, the 1999 gold market, etc….
Please guys, do not put out your personal, uninformed opinions as if they are investing gospel. You are simply wrong. Inflection points are not bottoms, and bottoms do not occur when the bulls are still given credibility.
Bottoms are only proven in hindsight, and so far we have no data confirming a stable trend of increasing prices. Until that occurs, all this bottom talk is bull$hit.
skeptical
DonC,
Would love to know what kind of skin you have in the game. I’ll be you have purchased within the last 2 years and do not live in Reno.
Carleton
I have a far simpler measure of when the bottom will be reached. There is a buuble-built group of houses called Belsera off of McCarran in SW Reno. For about 2.5 years, the house on the point (which would have a stunning view of Reno) has been sitting half built with the roof tiles still sitting on the unfinished roof where the roofers left them 2.5 years ago when they walked off the job for non-payment.
There are 3-4 houses there that are on the market either as REOs or short sales. Going for about 50% off of bubble pricing.
When I see that house completed, I will know we are at the bottom.
MikeZ
[Carleton] “When I see that house completed, I will know we are at the bottom.”
An indicator like that – completion of a house currently on hold – would likely signal 6-9 mos of upside.
[skeptical] “Look at the 1939 and 1981 stock markets, the 1999 gold market, etc….”
Exceptions don’t make the rule. There are many more bottoms you could choose, the ’98 bottom in real estate for example, that contradict your thesis.
[skeptical] “Please guys, do not put out your personal, uninformed opinions as if they are investing gospel. You are simply wrong.”
Consider taking your own advice!
[skeptical] “Bottoms are only proven in hindsight, and so far we have no data confirming a stable trend of increasing prices.”
Price appreciation would be on the upside, not the bottom.
smarten
Carlton, not knowing the price points of these unfinished houses you refer to, let me suggest that if/when you see construction resume, the “bottom” in their price strata was probably reached 6-9 months before. Just my two cents.
BanteringBear
My money says MikeZ bought a house. He was on this blog long ago, with bearish sentiment, and now he’s singing the bulls tune. Same as Smarten. These guys buy a house, and all of a sudden the bottom is in. Blinders.
skeptical
BB,
No doubt. I’d love to hear from a single bull who has NOT purchased within the last two years. As of this writing, DonC noticeably silent.
I am not trying to pick a fight here. I respect the views of any contributor, when cogently and logically presented. We all have biases, but it’s important to recognize those biases for our own good.
That said, cognitive bias continues to be a primary influence in the analytical process of most bulls on the Reno RE market, near as I can tell.
skeptical
Should have added to the above that every “man on the street” report that’s been contributed to the blog (typically from persons that are not regular contributors) has been overwhelmingly negative.
The bulls just brush these aside, though, as if they don’t matter.
smarten
Well how about the fact that the bears, specifically Mr. BB, are singing the tunes they’re singing specifically because they DON’T own real estate? So what’s the difference.
Mr. BB and others know I too was down on the Washoe County Residential Real Estate market [as contrasted with ANY residential real estate market located anywhere] for some number of years. When I saw a change, I acted upon it [I have never hidden the fact that I own property]. The bears see change and respond, it’s not enough. For them it’s NEVER enough. Even when they’re forced to admit there’s been a market reversal, they still won’t act because they will have missed the boat. What we’ll likely hear is that the second [or third, or fourth] leg of the downturn is just around the corner.
Even skeptical states it’s an acceptable time to be buying residential real estate as long as the strata of the market you’re interested in purchasing has bottomed, and you’re able to cut the bejesus out of the seller’s asking price.
Assuming our oracle from the garden has any money to buy real estate, I’d be interested in hearing what he’s doing with it [medicinal marijuana?]. How about shorting residential housing futures?