I should also say that last week I received an email that appears to be a death threat. Hate mail is one thing and aggravates me to no end. I've received hate mail from almost the day I started this blog. But death threats are something else altogether. I know real estate is an emotional topic for some, and here in Marin it is akin to an outright fanatical religion. I don't know if this email was for real or just a cruel joke. The email simply read:

I swear if I ever find you your dead.

That's it. I assume it is in reference to my blog as I don't know what else it could be. I think they are just trying to scare me off and, well, it worked. I won't try and electronically track this person down because if I prosecute then I blow my anonymity and then I'd be really scared.

“For people to think that we could go back to traditional lending standards and have prices remain where they are now is just crazy," said Peter Schiff, head of Euro Pacific Capital in Newport Beach. "Real estate will have to go back to 2000 levels. And a lot of people who just bought a home will find that instead of having an asset, they have a liability.”

[Quoted on March 18, 2007, during the sub-prime (soon to be prime) lending meltdown. It didn't have to be.]

Just want to get these pics out before I shut this thing down once and for all. The above graphs are too important to ignore. I'm sick of the abuse and hate mail. You can find the data for the last two here and the article here.

Ok, ok. Here is Vision RE's data:

Look at those sample sizes! They are tiny. Can you really say that there was a real 58% appreciation in Sausalito when only 5 sales were recorded or a whopping 262% appreciation in Tiburon when only 3 sales were recorded? Get real!

The 10% bump in prices that DataQuick reported for January is a statistical fluke. Even DataQuick admits it for crying out loud! I called them and they told me that in January 06 there were a lot of condo conversions in Marin that came on line and that resulted in an unusually low median sale price for the county. Thus, January 07's more normal pricing looks like a huge bump. This can happen in a small market like ours. I asked what she thought true appreciation was for Marin and she said more likely in the "low single digits".

Apparently, a long-time reader also called "BS" on DataQuick and so he emailed them. DataQuick told him exactly the same thing (I guess that is what their PR people told them to say). Here is the email reply from DataQuick that he forwarded to me:

The year-ago median was low a year ago because of a some condo conversion project up in Novate. This can happen to the median when you have just a couple of hundred sales.

jk

And I think it is really shameful that a blogger should have more investigative journalism skills than our lame excuse of a paper, the Marin IJ. I mean, they were all over that 10% figure but did they even bother to ask what was behind it? It's too bad it will be the only source of info for people.

"What Have I Done?"

Apparently, one of the authors of the original 1973 county development plan feels some remorse for the mess he helped to create. He says that they didn't realize they were screwing around with the supply/demand equation. I say BS to that. My parents and their friends that I have spoken to all admit now that the unspoken truth at that time was that the county plan would cause property values to increase and that was a major reason for their voting in favor of it. What a crock.

In 1973, Gary Giacomini and Marjorie Macris helped to create the Marin Countywide Plan, a document that helped establish the county's growth patterns for three decades.

Both Giacomini and Macris agree that the plan succeeded in its original goal: to preserve the coastline, forests, hills and farms in the 606 square miles of unincorporated Marin from becoming overwhelmed by development.

And both agree that the plan also led to traffic gridlock and housing prices hardly anyone can afford - consequences county officials hope to address in the latest update to the document.

"In the '70s, I thought we were heroic in protecting the environment," said Giacomini, an attorney who served as a county supervisor for 25 years. "But I think it's a fair rap to say there were unintended consequences. We dramatically affected the supply and demand equation, and the result was a dramatic escalation in the price of housing. And there was the escalation of traffic because people couldn't afford to live or work here.

"As one of the architects of the plan, I have sometimes asked myself, 'What have I done?' "

It's About Time Marin Deals with the Affordable Housing Issues

This article was published in the IJ a few months ago. I guess I am posting it now because it is the first time a comment of mine was actually published by the IJ with the URL to this blog being included. Granted, I agreed with the author, but still...

Some choice quotes:

MARIN COUNTY and its cities and towns are discussing who should be responsible for creating housing needed to meet expected job growth over the next seven years.

Some of those officials, unfortunately, make this housing sound like an unfair burden dumped on them by the state. They are wrong.

Marin has an obligation to build its fair share of affordable and workforce housing. The county's failure to do so for decades has resulted in more and more people making long commutes each day to jobs here...

If Marin doesn't find a way to create this housing over the next seven years, those new workers also likely will drive from homes outside the county, placing further strain on our highways and creating more air pollution. Those long commutes also put additional strain on the fabric of this county, with more and more people unable to live near where they work.

In fact, Marin and its cities should strive to exceed those mandates because of the acute shortage of workforce housing in the county. This is a problem of our own making.

Those housing mandates are daunting for Marin because much of that new stock will have to be in-fill housing. One of the reasons for that is because a large chunk of available land essentially has been taken off the table for new housing.

It's about frigging time Marin County gets off its NIMBYist arse, stops engaging in denial, and stops investing so much energy in coming up with ever more ludicrous rationales for why it should continue to do almost nothing and why it is some other county's responsibility.

The following reply to the article summarizes so well the sort of denial that plagues this county:

IJ: Housing mandates must be fulfilled ... The county's failure to do so ... has resulted in more and more people making long commutes each day to jobs here

They take those jobs and make that commute voluntarily, because they prefer that option to all their other options...

This sort of lame rationalization has been entrenched in Marin since at least the 70s. (In fact, we've recently had to endure it here on this blog when one commentor, who objected to the suggestion that there might be a racial or classist element in why Tiburon is resisting building three affordable houses, tried to convince us that no one has done more for non-Caucasians than Caucasians. Bah!) The fact is that we have done everything within our power, both as a county and as a state, to make Marin housing (and that of California at large) unaffordable. The writer of this comment wants you to believe that these people could choose to live in Marin if they wanted to but don't because they choose not to and would rather make those long commutes. Typical Marin self-delusion. The reason why these people make these horrendous commutes is because we have given them no other choice; we've forced them to make those God-awful commutes all in the name of satisfying our personal financial well-being... namely, property values. Marin is one of the bedroom communities for San Francisco, the major employment center of our region. We have a responsibility to do our part to enable people who work there to live nearby. We have a responsibility to allow people who work in Marin, and who thereby enrich our lives, to live in Marin. It's time we get off our classist, we're-so-much-better-than-you butts and deal with it. We are part and parcel of this mess, we helped to create it, and the sooner we wake up and deal with it, the better.

Strong-armed into Switching to Blogger 2

Just so you all know, Google has now started forcing users of the old Blogger (which is what I have been using) to upgrade to Blogger 2. I have resisted upgrading for months and months but now it seems that I can no longer log into my own blog and make a post without first upgrading. So I upgraded to Blogger 2 just so that I can make this post.

Whether you realized it or not, I have resisted upgrading mainly for YOUR protection and convenience. You see, the new Blogger 2 requires everyone, including those of you who want to leave a comment, to sign in using your Google account (if you don't have one then you must create one). The reason why Google does this is so that they can track your click history (where you are going on line, what you are doing, how long you lingered on a page, did you buy anything, etc.) and correlating it with your Google profile (you have to complete a "profile" to get a Google account) so as to push targeted marketing in your face and to better sell advertising.

Not everything Google is golden.

So to interact with this blog you must now create a Google profile. My suggestion is to not put any personal information in that profile (unless you really want to, of course). Don't even provide your real name. For example, to keep my anonymity my user name is my inherently anonymous email address, my display name is "marinite", my gender is not specified, etc. No other info needs to be entered into the profile. So you can remain quite anonymous with a Google profile. So don't be scared to create a profile if you are concerned about anonymity.

I won't change to another blog hosting service as I don't want to lose all the posts to this blog and I don't want users to now have to remember a different URL.

But so far I am not impressed with Blogger 2. It seems to have that problem that plagued the old blogger in the early days... unable to reliably upload pics. How hard can this be? First they torture us with their old buggy software and now we get to be tortured again with their new buggy software...sigh.

Stakeout of Habitat for Humanity Proposed Tiburon Site

As you recall (here and here), Habitat for Humanity wants to build three large market rate houses ranging in size from 6244 to 7446 sq ft (huge and no doubt hugely expensive) at the top of a lot in Tiburon. At the bottom of the lot it wants to build four affordable three-bedroom houses of about 1435 sq ft each.

The Tiburon neighbors of this proposed building site are up in arms about the affordable houses (but not the monster houses) because they believe the affordable houses will bring down property values. They have also claimed that the street (Eagle Rock Rd.) is dangerous; people go zipping up and down they say, and so it is dangerous to neighborhood children. By some form of twisted logic that I do not yet fully understand it is the affordable houses, not the fancier ones, that will be the cause of the traffic problems.

So I decided to drive out there during lunch and check this place out for myself and take a few pics while I was at it.

Here are a couple shots of the lot in question:


Eagle Rock Rd. is the one that heads off to the left in that second picture (with the silver car parked on it). Below is a better shot of Eagle Rock Rd:


As you can see, Eagle Rock Rd. has a slope to it but it is very wide by Marin standards. Two cars can easily pass each other even when cars are parked at the sides of the road. Furthermore, I staked this area out for the better part of an hour and I only saw five cars go up or down this street; not very busy at all. The "dangerous" parts of this street, if they can be called that at all, are further up where it splits into two one-way streets...one going up and the other back down. But this more dangerous area is far from the proposed building site and so would seem to be irrelevant to the argument proposed by the Tiburon residents.

Below are a couple of shots of some of the near by houses:


And here are what some of the neighbors are driving:






Hopefully this will give non-local readers a better idea of the physical environment surrounding this controversy.

A Request

We are soon entering into the spring sales season. The number of listings, the number of POSs for the POS Blog, and the number of entries to this blog will increase as a result. I ask you to lay off using the "anonymous" option when leaving comments. Please choose an "other" name and use it consistently or register with Blogger (it is free and still anonymous) and use that registered name when posting comments. The reason is that, as you may have noticed, people who leave "anonymous" comments have a greater tendency to be less responsible about what they say (even though all available options are anonymous). And it is very difficult to know who is saying what when a "conversation" thread develops. Please don't make me have to turn off the "anonymous" option again.

MAR Announcement

I don't want to link to the site where I found this blurb as they refuse to post comments where my blog's URL is embedded (that site is moderated by the Marin Association of Realtors (MAR) so I am not surprised in the least).

But this is just too funny. The "truth". Right. More like "what we want you to believe; pay no attention to anyone else but us". I smell desperation.

MAR Launches Speakers Bureau to Discuss the Truth About Marin Real Estate

The Marin Association of REALTORS® has launched a new speakers bureau to talk about the realities of Marin real estate with community and business leaders across the county. MAR President Valerie Castellana, joined by other association officers and current and past board members, are scheduled to speak to more than a dozen chambers of commerce, Rotary Clubs, and other organizations in coming weeks.

“Recent scary headlines about real estate trends do not accurately reflect the insights and perspectives of real estate experts, the realities of the marketplace, or the unique nature of Marin. Our speakers bureau will enable local leaders to hear directly from their local REALTORS® about the realities of real estate in Marin County,” Castellana.

The REALTORS® will share their insights and perspectives on “the truth about real estate in Marin.” Their presentations will cover topics including current market trends, the future of the housing market, how to avoid common mistakes when buying or selling homes, and the differences between real estate agents and REALTORS®. Members of the speakers bureau include Valerie Castellana, Kathy Schlegel, Job Zeiter, Kate Hamilton, Roberta DiPrete, Kay Moore, Margaret Deedy, and Justine Fairey, and Ron Parks.

The members of the bureau can be scheduled to speak at membership or community meetings or take part in panel discussions, seminars and workshops...

If any of you readers attend any one of these MAR propaganda-love-ins, please take notes (or better yet, make recordings) and share them with me so that I can post them. If you need the contact info provided in this blurb, just email me and I will give it to you. But if you do attend, be prepared for the MAR's lereahing of the public.

Survey Says... You Suck

LOL! Thanks to a dedicated reader for this one.

Q: On what basis do most people rate a job as being prestigious?
A: The most prestigious jobs are those that most help other people.

Q: What job is rated by most people as second to least prestigious?
A: Real estate agent/broker (second only to stockbroker).



Well, look on the bright side. All you wannabe stock gurus/day traders back during the NASDQ bubble who jumped on to the real estate get-rich-quick bandwagon after the stock bubble bust did manage to improve your prestige by 1%. What's it going to be next? Give us a heads-up, will 'ya?

What Happens When Easy Credit Is Not So Easy?

I found this referenced over at Ben's blog:

Those considering buying into the real estate 'soft landing' scenario ought to think twice. There will soon be over $1 trillion of adjustable mortgage payments increasing beyond the payment capacity of the borrower. Many borrowers, upon realizing that the monthly payment is about to adjust, will go searching for loan programs similar to their original loan.

New 'guidance,' handed down by the Office of Federal Housing Enterprise Oversight Committee, requires…the borrower must now qualify as if the adjustable loan had already changed to the highest rate possible under the loan program.

It has been estimated that 90% of all people who obtained these 'stated' income loans lied on their mortgage application about how much they made. On October 1, 2006, the IRS updated their capacity to respond to lenders' requests verifying borrowers' 'stated' income. In short, what used to take months to respond to will now take two days. Inside of 48 hours, the 'stated' income will be verified as false. How will these people qualify then?

According to RealtyTrac, lenders who foreclose on a property in Ohio get 57% of appraised value when they sell the property. That amounts to a 43% hit on principal!

Consider the inevitable: You have buyers in the market with a choice of inventory, which do you think they'll buy? A lender-owned property at a big discount or one owned by a private party for near full price?

In California, unsold inventory has grown by over 100% in one year. Thus far, there has been limited price damage because almost all of the properties for sale have been privately owned. In 2007, that will change. The new inventory for sale will consist of lender-owned properties, builder auctions, and short sales. All of these sellers will be selling to a less motivated, smaller group of less-able-to-qualify buyers.

I hear the piper and he wants to be paid. If Bay Area housing sale prices are to increase or even stay where they are either wages/salaries have to increase by a whole lot over a relatively short period of time or access to easy credit (a big part of which requires being able to state what ever you can get away with vis-à-vis income) must be maintained or made even easier. Many here in the Bay Area have had to make use of lying about their income on their stated income loans. Many others are dependent on other sorts of "toxic" loans. What happens when people cannot lie on their stated income loans? A whole lot fewer Bay Aryans can qualify for a loan, that's what. What happens when a whole lot fewer people can qualify for a loan? A whole lot fewer sales. The move-up chain begins to break down. What do sellers have to do to sell their houses? Lower the price down to where people can now get loans or wait for years and years for the selling environment to improve or bury a lot of St. Joseph statues or pray that an army of rich [insert your favorite foreign nationality] come in and swoop up properties. Good luck with that.

Oh, but wait. California is moving towards cracking down on the stated income loan. What will Bay Aryans do?

California lawmakers on Wednesday began considering restrictions on unorthodox mortgage-lending practices that have allowed hundreds of thousands of Californians to buy homes they otherwise could not afford.

'The exposure to these sorts of products, the growth, is unprecedented,' Raphael Bostic, an associate professor at the University of Southern California School of Policy, Planning and Development, told a Senate committee. 'The regulatory oversight of these types of practices is relatively lax.'

In September, five federal regulatory agencies issued guidelines calling on federally regulated lenders to better gauge borrowers' ability to pay before using the nontraditional loans. California is considering similar rules for state-regulated lenders, as have 24 other states, said Sen. Michael Machado.

About 60 percent of sub-prime loans in California those given to the highest-risk borrowers allowed them to pay only the interest or gave them that option on an adjustable rate mortgage, the Federal Deposit Insurance Corporation estimated. Many of those borrowers are at risk of losing their homes as the market continues to stagnate, witnesses said during Wednesday's hearing.

About 12.5 percent of riskier mortgages nationwide were delinquent by last fall. Nearly 1 million homeowners nationwide either lost their homes or missed monthly payments from July to September, according to the Mortgage Bankers Association.

'The market did not save them,' testified Pam Canada, executive director of Neighborhood Works Home Ownership Center in Sacramento. 'This was a nightmare with no happy ending.'

'We've already seen a dramatic increase in foreclosures here in California,' said Paul Leonard, California director of the Durham, N.C.-based consumer advocacy center.

And it will only get worse. More than $1 trillion of adjustable rate mortgages will reset in 2007 and given the Bay Area's dependence on "toxic" and "liar's" loans, I bet we will be one of the regions to be hit the hardest.

I've got my hard-hat. Do you have yours?